I think the liberals are terrible but I have little faith that things would be any different with another party in charge. They all see the pot of gold and salivate. None really give a rats ass what happens to the country beyond the next election.
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COVID and the housing market
- Thread starter mimico_polak
- Start date
bigpoppa
Well-known member
Most accurate thing ever.
blackcamaro
Well-known member
I agree with 151k over when 51k would win isn’t a healthy marketplace.
I struggle to think a open auction would make things more affordable if that’s the goal though. Especially when it’s with something as emotional as a family home....in the heat of the moment it’s far too easy to say “okay we will bid one more time” and repeat over and over. I feel like people will just keep bidding until they hit the max they have been pre approved for. I think it would just carry prices higher.
Fair enough. Oz has used auctions successfully for a long time.
An alternative scheme that is healthier is everybody submits a best and final offer. Winner pays $1 more than second highest offer.
In both the auction and this program, there would need to be standardized conditions. Ideally none so maybe home inspection available for review to all, financing is on you so don't screw it up?
blackcamaro
Well-known member
I know they use auctions in Oz, I’m kind of under the impression it hasn’t really made housing more affordable. Maybe @DownUnder has some insight on how it’s worked out.
I really like the one and final bid scheme but modified. I would change it from the buyer pays $1 more then the second highest offer into just one and done. You offered this much on this day and can’t make another offer on the property for say 30 days. Plenty of tools out there for the buyer to do their due diligence and establish a fair market value from their position. If they just go off the advice of the realtor who they interviewed and hired well that’s on them. This cuts out the bs games on offer day we currently have.
If my way is still too loose then I would prefer the $1 over the second highest bid then a open auction.
For the greater good I agree with standardized conditions. A mandatory home inspection would be a huge benefit and protect a lot of first time home buyers or others that are stretched thin just to make the deal in the first place. Freaks me out a little when I hear about people making no condition offers on say a $700,000 place with 10% down. There is literally no wiggle room if major repairs have to be made immediately.
This would be a disaster everyone would bid to the moon knowing they pay 2nd highest price.
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Only once. Filing for bankruptcy on a failed house bidding strategy would make the headlines.
Mad Mike
Well-known member
More doom and gloom
Opinion: The housing boom is ripping apart the financial fabric of Canadian life
The rapid acceleration in housing prices is causing tremendous stress to the personal finances of individual households and the nation as a wholewww.theglobeandmail.com
In 2007 a $500k mortgage would have cost $3650 mo. As 5 year money was 7.2%.
fast forward to today, that $500k mortgage would cost $2050/mo at 1.7%. For $3650 at 1.7%, one could borrow $900k today.
In 2007 my sis bought a starter wartime house in Burlington for $500k, today it’s worth about $900k. From an affordability and cash flow difference... there is none.
Pick 2010 and the situation is dramatically different. I was paying 2.84%.
No idea why her house grew so little, my suburban house more than doubled from 2010 to 2018. Friends in Burlington more than doubled in less than 10 years starting around 2007.
blackcamaro
Well-known member
What about a cap on rent? In the major cities rent isn’t too bad since the whole Covid thing started, but it seems like it’s out of control in the smaller markets.
@george__ has talked about the rent prices in the Kitchener Waterloo area before. A while back I joined a Midland area rental FB group just to get a feel for the market prices, demand, type of tenants etc. It’s absurd, like $1600-$1700 gets you a dump 1 or 2 bedroom apartment over a store front. It’s not worth almost $20,000/year after tax and these places are geared to the lower income folks. One property manager commented that for 11 listings they had 149 applications!?!
House prices I’m fine with the market dictating where they go. If it’s unaffordable so be it, I don’t have this thought that everyone deserves to own a place. I do have a issue with people not being able to afford rent. Everyone does deserve to have a roof over their head.
So why not some sort of rent cap. Put it in place on 1-2 bedroom condos, 2 bed townhouses and 3 bedroom detached. It would take demand out of the resale market, renters that are determined for better will be able to save more and have affordable housing for everyone.
Leave the luxury rental market alone. The big dogs that choose to rent can pay whatever the market says it’s worth.
How to implement this would be a totally gong show and I’m sure there is plenty of holes in this idea. Something likes this should help everyone regardless of their situation. In my head anyways.
@george__ has talked about the rent prices in the Kitchener Waterloo area before. A while back I joined a Midland area rental FB group just to get a feel for the market prices, demand, type of tenants etc. It’s absurd, like $1600-$1700 gets you a dump 1 or 2 bedroom apartment over a store front. It’s not worth almost $20,000/year after tax and these places are geared to the lower income folks. One property manager commented that for 11 listings they had 149 applications!?!
House prices I’m fine with the market dictating where they go. If it’s unaffordable so be it, I don’t have this thought that everyone deserves to own a place. I do have a issue with people not being able to afford rent. Everyone does deserve to have a roof over their head.
So why not some sort of rent cap. Put it in place on 1-2 bedroom condos, 2 bed townhouses and 3 bedroom detached. It would take demand out of the resale market, renters that are determined for better will be able to save more and have affordable housing for everyone.
Leave the luxury rental market alone. The big dogs that choose to rent can pay whatever the market says it’s worth.
How to implement this would be a totally gong show and I’m sure there is plenty of holes in this idea. Something likes this should help everyone regardless of their situation. In my head anyways.
I like it in theory but in practice it eliminates the rental stock and you are left with TPH where rent is affordable but you are on a decades long waiting list to get a place to stay. If someone bought the condo you are renting for 600K and paying 700 a month in condo fees and property tax plus some maintenance/repairs, what do you think rent should be? Mortgage payments will be ~2500 to 3000 a month. Do you think many people will put dwellings on the rental market when they are ~$2000 a month cash-flow negative until the mortgage is paid off? Nope, they will disappear from the rental market which may help affordability somewhat for people buying but the renters are still screwed in that scenario. Maybe some of the big corporations will continue to add some stock as they use their paid off units to cover recent acquisitions but the small landlord for the most part will cease to exist. Sadly rent has to approximately float with property values for the system to stay in equilibrium.
A crappy alternative is rental properties shrink in size to maintain the monthly payment. Back to european living with a bachelor or 1 bed for the parents, grandparents and kids to share. Purpose built rental buildings have some advantage as they don't have crazy high condo fees that are paying for lots of crap renters don't care about. Alternatively the city collects ~1K in property tax on a rental and 3K on a similar principal residence to help out the renters. Nobody wants to pay for the whole pie, they each think most of the pie is someone else's problem.
blackcamaro
Well-known member
@GreyGhost your right. It wouldn’t work. In my hypothetical the government takes up the slack and creates communities of rentals. Not quite subsidized housing but that’s probably what it would end up turning into.
Otherwise yeah it would just be a couple of corps and maybe some high net worth individuals that need a place to park money. No ones putting 20% down to take a monthly loss.
Some balance would be nice.
I hate that people are struggling to find a place to live. Then once they do having to choose between paying the bills vs buying food or whatever other issue they come up against.
Otherwise yeah it would just be a couple of corps and maybe some high net worth individuals that need a place to park money. No ones putting 20% down to take a monthly loss.
Some balance would be nice.
I hate that people are struggling to find a place to live. Then once they do having to choose between paying the bills vs buying food or whatever other issue they come up against.
Mad Mike
Well-known member
The west end of Burlington is a mixed bag. You can still find older condos (apts)in the $3s, and there are still some reasonable townhouses in the $5s. The older wartime houses go for land value, still not a bad deal for her considering she bought with $30K down.
2.84% would have been super cheap money on this day in 2010 -- the national average on a 5 year closed was more than double that.
I've given up on Circus Canada. People keep electing the clowns.
There is no answer to the housing crisis. Big business isn't going to give a cent towards housing and they won't pay living wages for employees to go it alone. The government solution is to take the money from the taxpayer to basically subsidize big business. At some point the well can't recover.
Technology and AI will be making it harder to find jobs every year. What do we do with the surplus workers?
Will we have to look at triage at some point?
There is no answer to the housing crisis. Big business isn't going to give a cent towards housing and they won't pay living wages for employees to go it alone. The government solution is to take the money from the taxpayer to basically subsidize big business. At some point the well can't recover.
Technology and AI will be making it harder to find jobs every year. What do we do with the surplus workers?
Will we have to look at triage at some point?
Mad Mike
Well-known member
NY, LA and Toronto all tried rent controls -- all failed miserably. They shifted the new housing market to condos and the legacy market to tenements. A very small number of people get subsidized units, and as supply dries up rents soar.
The real solution is to divest the province by investing into outlying areas. Move gov't bureaucracy to smaller centers, invest in infrastructure to connect more of rural Ontario. Little cities like Kingston, Peterborough, North Bay could all support large contact centers, processing centers, and industry that only needs a connection to transportation. Most small Ontario cities are anchored on Universities, help them divest their economies. Loosen development restrictions in those areas so building is affordable - people will move if there is opportunity.
Another thing I would really like to see is the Ring of Fire get road and rail. I think the North has tremendous potential as the world appetite for mine products heats up.
For all those worried about the cost of cheap housing, do you ever think of Sudbury, North Bay, Timmins, Peterborough? Most of these cities have homes available for 25-50% of what you would pay in Toronto.
Here is the most expensive house for sale in Timmins: Check out this listing
bigpoppa
Well-known member
The reason no one buys homes there or moves is because there's not much economic activity or work.
D
Deleted member 50930
Guest
I don't think rent control works either. Lots of the older buildings are rent controlled and the new owners that buy it do the bare minimum. It was a nightmare POS disgusting existence with lots of fighting
:format(webp)/https://www.stcatharinesstandard.ca/content/dam/niagaradailies/news/niagara-region/2020/02/03/landlords-blame-period-of-transition-for-residents-concerns/B881030661Z.1_20200203123741_000_G2KSBPGK.3-0_Gallery.jpg)
www.stcatharinesstandard.ca
This landlord was a piece of work
Landlords blame 'period of transition' for residents' concerns
Say they're planning for future expansion despite current issues
This landlord was a piece of work
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Years ago a friend chose peterboro to set up his tech company. Houses were barely six figures and his staff could live like kings.
That's a nice house but I am confused about building something that big and fancy in Timmins and only building a single car garage.
D
Deleted member 50930
Guest
Bungalow houses by Kawaratha are going for $550-600k now
Why the heck would I pay that much to live out there????
Those rural people are RICH
Why the heck would I pay that much to live out there????
Those rural people are RICH
bigpoppa
Well-known member
gonna guess its either parked foreign cash or recently expat GTA'ers who are able to work from home (for now) vis-a-vis covid
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