COVID and the housing market

[mimico_polak]

I've seen it mentioned that it was on new homes only but haven't checked which version of the story is true (and I suspect we only have soundbites now and the locked in definition doesn't appear until the budget). In that case, it's a complete nothing burger as what first time buyer is buying new? Maybe some condos but a 30 year mortgage on a condo is a bleeping terrible idea.

Everything I read said on new build, but once the budget comes out in sure it’ll be a whole lot of nothing.

In other news…this was a shocker to read by me…

Foreign landlord fails to pay taxes, CRA goes after tenant — The Globe and Mail

A Montreal tenant was audited and ordered to pay the tax he had failed to withhold on the monthly rent to his non-resident landlord

apple.news

 

[nobbie48]

I've seen it mentioned that it was on new homes only but haven't checked which version of the story is true (and I suspect we only have soundbites now and the locked in definition doesn't appear until the budget). In that case, it's a complete nothing burger as what first time buyer is buying new? Maybe some condos but a 30 year mortgage on a condo is a bleeping terrible idea.

I heard new homes only, typically built to meet Tarion minimum standards.

So Jim and Julie buy a spanking brand new place and after ten years are blessed with little footsteps, worn out cheap carpet or laminate, cupboards falling off walls and windows that don't open or close properly. Driveway is a mess and roof is showing wear.

They're up a bit in equity but fixing the above brings them back to where they came in. They need a new car because the old one wore out waiting for decent public transit.

 

[raginduck]

Everything I read said on new build, but once the budget comes out in sure it’ll be a whole lot of nothing.

In other news…this was a shocker to read by me…

Foreign landlord fails to pay taxes, CRA goes after tenant — The Globe and Mail

A Montreal tenant was audited and ordered to pay the tax he had failed to withhold on the monthly rent to his non-resident landlord

apple.news

I just came to the thread to post the same article..
I think a lot of people are going to be shocked.
It seems very unreasonable to me.. the cra can always go after the property to force the landlord to pay.

 

[Baggsy]

CBC says TO prices will exceed Van.
https://www.cbc.ca/news/business/housing-reports-crea-lepage-1.7171675

 

[mimico_polak]

I just came to the thread to post the same article..
I think a lot of people are going to be shocked.
It seems very unreasonable to me.. the cra can always go after the property to force the landlord to pay.

Exactly. Going after the tenant is an extra F-u and allows the landlord to get out of it free and clear.

WTF is a non-resident even able to buy up and profit from housing here!? CRA is taking the easy route by going after the tenant as it's too much effort to go against the landlord.

Force the sale, or lien the property so you get your tax money when it's sold.

 

[mimico_polak]

CBC says TO prices will exceed Van.
https://www.cbc.ca/news/business/housing-reports-crea-lepage-1.7171675

I expect interest rates to climb further in all honesty. The current level may be impacting starts, construction sector, and some sectors more than others...but overall...I don't see much slowdown in house sales or pricing.

But statistics and I don't get along.

 

[nobbie48]

Exactly. Going after the tenant is an extra F-u and allows the landlord to get out of it free and clear.

WTF is a non-resident even able to buy up and profit from housing here!? CRA is taking the easy route by going after the tenant as it's too much effort to go against the landlord.

Force the sale, or lien the property so you get your tax money when it's sold.

What government agency takes the hard road, harder to pick fruit?

 

[raginduck]

Exactly. Going after the tenant is an extra F-u and allows the landlord to get out of it free and clear.

WTF is a non-resident even able to buy up and profit from housing here!? CRA is taking the easy route by going after the tenant as it's too much effort to go against the landlord.

Force the sale, or lien the property so you get your tax money when it's sold.

I have to assume the laws don't allow it.. otherwise sending a letter, registering a lien and waiting for the payment.. is a lot easier and cheaper than taking the tenant to court.

 

[mimico_polak]

I have to assume the laws don't allow it.. otherwise sending a letter, registering a lien and waiting for the payment.. is a lot easier and cheaper than taking the tenant to court.

No clue about the laws, but I'm hard pressed to see how the CRA is going to get anything out of the tenant.

I can already see it now 'hey landlord I'm going to pay you only 75% of the rent because I'll have to hold back 25% for the CRA in case you're shady. You're cool w/ that right?'

 

[mimico_polak]

I heard new homes only, typically built to meet Tarion minimum standards.

So Jim and Julie buy a spanking brand new place and after ten years are blessed with little footsteps, worn out cheap carpet or laminate, cupboards falling off walls and windows that don't open or close properly. Driveway is a mess and roof is showing wear.

They're up a bit in equity but fixing the above brings them back to where they came in. They need a new car because the old one wore out waiting for decent public transit.

I'm trying to see your point? This is the case now.

Houses are built to a minimum standard, and the owners are responsible for ensuring that they maintain their property to their liking.

If they wear out the cheap carpet, laminate or cup boards...it's now on them.

While I complain about Kevin...the onus is on me to bring the property to a standard that is to my standard...same as Jim and Julie.

If they fail to maintain their property...well I guess Jim and Julie need to step up as home ownership requires costs over and above that of the mortgage payment.

 

[Evoex]

Inflation in the US was soaring on Tuesday. Market was not a nice place to be.

/patiently waiting

 

[mimico_polak]

Inflation in the US was soaring on Tuesday. Market was not a nice place to be.

/patiently waiting

Just got off the phone with my broker, he said all the fixed rates went up 30bps last night due to some bond yield mumbo jumbo.

Everyone was expecting a drop, and then US CPI was 0.1% higher than expected and it upturned everything on them...

I'll be honest I didn't understand half the words he was using...but I got that things aren't looking good and IMO rates may go up in the US...so we will have to follow suit to keep the CAD from tanking.

But...I know nothing about this stuff.

 

[crankcall]

Re : foreign landlord , there is a saying in the law business , did know or should have known. It’s a big cover your arse clause for the guys on the receiving end of money .


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[nobbie48]

I'm trying to see your point? This is the case now.

Houses are built to a minimum standard, and the owners are responsible for ensuring that they maintain their property to their liking.

If they wear out the cheap carpet, laminate or cup boards...it's now on them.

While I complain about Kevin...the onus is on me to bring the property to a standard that is to my standard...same as Jim and Julie.

If they fail to maintain their property...well I guess Jim and Julie need to step up as home ownership requires costs over and above that of the mortgage payment.

I was suggesting that while one would expect to be ahead of the game in ten years the aging out of the structure and life events do a reset in a decade or so. In reality it’s often just another act in the play.

As housing costs escalate they may never become empty nesters

 

[crankcall]

North Americans may need to get comfortable with the Asian / European solution of multi generational homes . Maybe being an empty nester is not the dream , maybe it’s a family compound for consideration.
For a country that measures an economy by housing starts , and missed the part where our GDP is lowest of the G7 countries? There’s a word for that , rhymes with trucked .


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[Mad Mike]

Government ad released this am shows a table based on how much savings will be had monthly using a 30yr vs 25yr mortgage.
They forget to say , all those savings disappear in extra yrs paying and the table is based on a 100k mortgage . 100k , we don’t need to build more affordable housing if the formula is based on single wide trailers outside Cochrane Ont.


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I don’t worry too much… 25 vs 30. Most people increase wages over time, making a mortgage more affordable.

If you got a 30 year mortgage on an average Toronto home in 2015, you’d be paying $2500/mo. Buy that home today, $4000/mo.

If the 2015 buyer ups her payment to 3000/mo, she’s paid off in 25 years, still ahead of the guy that waited.

 

[Mad Mike]

Everything I read said on new build, but once the budget comes out in sure it’ll be a whole lot of nothing.

In other news…this was a shocker to read by me…

Foreign landlord fails to pay taxes, CRA goes after tenant — The Globe and Mail

A Montreal tenant was audited and ordered to pay the tax he had failed to withhold on the monthly rent to his non-resident landlord

apple.news

Way back CRA did inform tenants to withhold and pay CRA if the landlord wasn’t a resident for tax purposes.

I remember being a non resident landlord and losing 25% of my rents.

 

[Mad Mike]

I just came to the thread to post the same article..
I think a lot of people are going to be shocked.
It seems very unreasonable to me.. the cra can always go after the property to force the landlord to pay.

CBC sensationalized this a bit. The tenant can pay taxes instead of rents until CRA is made whole. Landlord cannot evict as tax on rents are liability owed to the tenant.

 

[nobbie48]

I don’t worry too much… 25 vs 30. Most people increase wages over time, making a mortgage more affordable.

If you got a 30 year mortgage on an average Toronto home in 2015, you’d be paying $2500/mo. Buy that home today, $4000/mo.

If the 2015 buyer ups her payment to 3000/mo, she’s paid off in 25 years, still ahead of the guy that waited.

My holy grail is the 1960 solid house, near public transit and short walking distance to shopping going for three or four years salary of a tradesperson. Mortgages were fixed for the duration.

Pay it off in a few years and then run it like a condo which, in today's dollars, would be setting aside $200 a month for reserves. Roofs and HVAC tend to last 20 years and when they need replacement there's 50K in the bank. Everything else is pay as you play / elective stuff. Housing stress was gone for a lot of people.

Grade 12 would get you a decent job without the burden of student loans.

Not everyone made trades wages. We still had some vagrants and homeless / hopeless. It was titillating gossip if you knew someone who knew someone who was on drugs. Doctors recommended smoking.

 

[nobbie48]

North Americans may need to get comfortable with the Asian / European solution of multi generational homes . Maybe being an empty nester is not the dream , maybe it’s a family compound for consideration.
For a country that measures an economy by housing starts , and missed the part where our GDP is lowest of the G7 countries? There’s a word for that , rhymes with trucked .


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The problem with that is is fights consumer consumption, the backbone of the western economy.

We are pushed through advertising to reject our parents values. Have your own style in cars, entertainment and furniture. Have your own TV and entertainment system. Your parents are dinosaurs.

They don't even use the right laundry detergents. Look at the soap wars. Hundreds of different soaps made by two or three companies pitting the wise M-I-L against the know nothing new bride D-I-L or vice versa. The psychology is hilarious.

Not every kid is a self entitled brat but the percentages are higher than in the past. How many of the entitled ones are up for paying a reasonable rent and sharing in the chores after decades of mom and pop doing it all? A lot of mom and pops would be better off renting to a stranger.

Do colleges offer courses for parents of the entitled brats? Getting control of your adult brats 101 or Intimidation by inheritance threat 101.