AllistonGT
Well-known member
Agree still scary. Even if rates are zero, you still have to pay it all back. With after tax money.
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COVID and the housing market
- Thread starter mimico_polak
- Start date
this'll just block your average joe buyer. like snowbirds buying property in florida.
send your kids to study here and buy house or use a corporation. this is what most big money investors are already doing and this conveniently ignores those.
won't stop much IMO, will cool the market maybe cause a small dip in prices that'll rebound back shortly. (as someone else stated before, even a 30% drop doesn't put us past last year prices)
I think it's more bark than bite with this.
Exempting students just means it continues as they're able to buy.
Put something in to stop the commercial investors, buyers and flippers, and you may have some impact...but right now not much will be affected.
EDIT: To me...this is more of a 'look...we're doing something'
Imo, much of that is because people are still shooting for the moon on prices. If you assume the last few months were an anomaly and not supportable prices, list it for a price you would have been happy with six months ago and most sell quickly.
FWIW, the cambridge semi I sent you listed for 600 and sold for 680 in less than a week.
Many people don't realize how much money some foreign investors have.
People outside the investment realm are more affected by interest rates and other side costs than the deep pocket types.
Agreed. People think that ‘real estate never goes down’ because they’ve seen the insanity, and their agents are telling them ‘to the moon!’.
And the property stays.
When’s the next BOC announcement? For some reason I thought it was yesterday.
EDIT: April 13
The timing is interesting as the expectation is that BoC will raise rates by 0.5% next week. So as interest rates go up, Feds take credit for something that was inevitable? (Cooling with higher rates)
It will be interesting in a terrifying way. Morons in power seem to be poised to spend a huge amount of money they dont have. That will drive inflation to keep the dollars high for the press release but lessen the pain of spending them. At the same time BOC will have to do crazy rate hikes just to keep inflation on the same trajectory. If boc is left on their own to lower inflation while jt actively does everything he can do to increase it, the ones that eventually get destroyed are domestic. Foreign (or cough domestic students) then swoop in and buy up everything.
48Connor
Well-known member
My mortgage broker sent an update email saying he's already seeing a lot less offers and showings.
Fixed rates are already up 0.5% since when I locked in my rate in January 2020. Another 0.5% this month and prices are double what they were two years ago. I expect a plateau or slight drop of prices, especially with the summer coming and usually more inventory.
EDIT: I see this effecting the areas outside the GTA a lot more than inside. Plateau of prices in the GTA I suspect, I would bet a decline outside the GTA
Fixed rates are already up 0.5% since when I locked in my rate in January 2020. Another 0.5% this month and prices are double what they were two years ago. I expect a plateau or slight drop of prices, especially with the summer coming and usually more inventory.
EDIT: I see this effecting the areas outside the GTA a lot more than inside. Plateau of prices in the GTA I suspect, I would bet a decline outside the GTA
This won't last long. Gonna be bunch of FOMO for houses if prices drop and back up they go.
Good luck
I share your sentiments on the morons... and sadly, there's still over 3 years to go...
You're right, it won't last long at all. Prices drop, others buy in. Prices drop, buy in.
One of the reasons I went with the HELOC. In case poop hits the fan, maybe there'll be a good opportunity somewhere.
48Connor
Well-known member
Only way to make it last longer is make it harder to get a loan (raising rates) which they are doing. Unless people have millions in cash...
You dont need millions in cash if you were already in. You just need enough access to capital to make the jump. A dip in prices should shrink the gap and allow more people to make the jump. That frees up cheaper houses for new buyers (or condo to sfh jump).
The most likely people to get burned in rising rates are the smaller domestic investors with multiple properties leveraged to the Tits as they have been acquiring as fast as they can get approved. They may need to start selling some to reduce the burn rate but that could lock in capital losses if they have chosen poorly. Is it good or bad that this type of investor takes a beating? I dont have strong feelings either way but I dont like policies that bake in winners and losers.
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Do you want to afford in Fergus if you’re commuting to Toronto daily?So sad. I can't even afford something in FERGUS
No I would have to quit..
Also considering 2 hours from Whitby but then no family support and a baby will be hell
Baby? A theoretical concept or congratulations in order?
We need investors in every market, energy, housing, transportation, food etc. and investors need to make a profit or else there is no start up capital. The problem is that a huge part of the market is speculation and no value added. Buy low sell high without any improvement or only cosmetic tart ups.
What is a reasonable profit? Where does that become greed? Does it pay to be a nice guy?
If a rental apartment building doubles in value is it fair to the investor / owner to have strict limits on rent increases?
Your neighbour mentions selling and you work a deal without real estate. What is a reasonable profit if you rent or resell?
Sadly the buyer is often to blame, the expectation of granite and marble. Their lack of trade skills means they can't buy a fixer upper and build sweat equity. Buy a house with good bones and make the roof sound, the drainage good and have working HVAC and plumbing.
The bungalow next door sold for about a half million a dozen years ago. It was spotless but with an updated laminate kitchen. It's around triple that value now and I wonder if some of the people that looked at it back then and turned up their noses are better or worse off for their choice.
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