COVID and the housing market

[Mad Mike]

The reason no one buys homes there or moves is because there's not much economic activity or work.

Are you kidding me? My kid runs a business up there, greenhorns in the mines are making $90K a year, heavy equipment operators and maintenance techs are making $50+/hr. He pays $5/hr more for warehousemen than he did in Stoney Creek.

You gotta like the outdoors, and you can't be afraid of the snow (or bears, or wolves).

And a nice 3 bedroom starter house that would cost you $600K in the stinky parts of the Shwa or Hammer is $150K in a decent neighborhood in Porcupine. Gas is $.10l more expensive, the cost of everything else is about the same.

 

[Mad Mike]

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.

Many houses there have detached garages -- I saw this one, it has a big yard with another interlock laneway that ends where the planned 3 car detached garage+coachhouse should go. I gave it a couple of thinks, but decided no - not yet.

 

[GreyGhost]

Many houses there have detached garages -- I saw this one, it has a big yard with another interlock laneway that ends where the planned 3 car detached garage+coachhouse should go. I gave it a couple of thinks, but decided no - not yet.

You've already got six bedrooms, add a lift that can go up through the floor and have off-season toy storage upstairs.

 

[bigpoppa]

Are you kidding me? My kid runs a business up there, greenhorns in the mines are making $90K a year, heavy equipment operators and maintenance techs are making $50+/hr. He pays $5/hr more for warehousemen than he did in Stoney Creek.

You gotta like the outdoors, and you can't be afraid of the snow (or bears, or wolves).

And a nice 3 bedroom starter house that would cost you $600K in the stinky parts of the Shwa or Hammer is $150K in a decent neighborhood in Porcupine. Gas is $.10l more expensive, the cost of everything else is about the same.

and yet no one is moving there
If we exclude everyone mad mike knows, I suspect the picture wont be so rosy

 

[Mad Mike]

and yet no one is moving there
If we exclude everyone mad mike knows, I suspect the picture wont be so rosy

I can tell you a lot of families from India are moving there - the men seem like the mines, heavy trucking and heavy equipment.

Enough that they have a unique way of distinguishing them from Indigenous (who both share the common name of Indian). Common speak there, would get me banished if I mentioned it here.

Here's a link to jobs that pay $80K a year: Job Listings – Timmins, Ontario If you can do hard and heavy work, you can carve out a nice life in the north.

 

[nobbie48]

and yet no one is moving there
If we exclude everyone mad mike knows, I suspect the picture wont be so rosy

I know some people that moved to Yellowknife and hated it for the first year or two. Now they don't want to come back.

 

[Green Meenie]

My mothers side of the family is from the Timmins area. They grew up there during the depression era. Her brother, Hugh Calverley was a self taught machinist at the McIntyre Mine for most of his career. He also played lead stone on the Northern Ontario curling team. They qualified and played in the 1949 Brier and came in 2nd place that year. I have a lot of his curling trophies still.

It's a unique area for sure. Great place if you're suited to the environment but it certainly wouldn't be everyone's cup of tea.
They did have the greatest bar I think I've ever been in though. Basement of the Senator Hotel - WOW! Hockey memorabilia like I've never seen in display cases all around the place. Loud, rowdy and a lot of fun. Long since gone I believe. Too bad. It was a treasure.

 

[ChrisCBR]

and yet no one is moving there
If we exclude everyone mad mike knows, I suspect the picture wont be so rosy

Precisely. Its simply not suitable for the vast majority of people from a job perspective, hence the low prices and then throw in the lack of things to do vs city life and the abysmal weather...

 

[nobbie48]

Precisely. Its simply not suitable for the vast majority of people from a job perspective, hence the low prices and then throw in the lack of things to do vs city life and the abysmal weather...

They do have a Starbucks and besides, what's there to do in Toronto?

Pay an arm and a leg to watch millionaires play sports or sing when you could be a participant in a smaller community. If it was sex would you rather pay to watch porn or be a participant for free?

Toronto weather sucks. Winter: A skiff of snow to snarl traffic but not enough to ski on. Summer: The atmosphere and odour of an under-ventilated gymnasium.

Bragging rights:

Toronto: I have a million dollar house.

Timmins: I have a $500 K house and it's twice the size.

If they want to do something about housing they have to work on transportation. Look at a road map of North America. The USA's network looks like a spider web. Canada's looks like a tightrope.

 

[bigpoppa]

I can tell you a lot of families from India are moving there - the men seem like the mines, heavy trucking and heavy equipment.

Enough that they have a unique way of distinguishing them from Indigenous (who both share the common name of Indian). Common speak there, would get me banished if I mentioned it here.

Here's a link to jobs that pay $80K a year: Job Listings – Timmins, Ontario If you can do hard and heavy work, you can carve out a nice life in the north.

Doubt it:

https://imgur.com/yR6unux

Here's the GTA for reference, notice the high concentration in brampton:

https://imgur.com/lItJHw3

 

[bigpoppa]

If they want to do something about housing they have to work on transportation. Look at a road map of North America. The USA's network looks like a spider web. Canada's looks like a tightrope.

Very interesting and probably accurate

I remember reading all that was done in the 50's after WW2...meanwhile in canada 2021...?‍

 

[backmarkerducati]

Left or right most of the ways that they try to manipulate the housing market to make it affordable never works like expected.

• Tight rent controls discourage the building of new rental buildings and eventually create slums of the old ones. Never good for renters in the long run but some regulation is of course needed as it could go totally crazy the other way.
• Large first time buyer incentives increase competition and drives up the price of entry level housing. It also penalizes people who built equity and are upgrading to a house from a condo vs people bankrolled by wealth and starting there.
• Interest only mortgages to lower the monthly costs played a big part in the US housing crash.
• Capping things like CMHC at $1M just keeps first time buyers out of the detached market and reserves this housing stock (pretty much all detached over $1M) for the wealthy or kids of.
• Stress tests are both good and bad for obvious reasons.
• Borrowing from RRSP, again that is money available to people with spare money...young and have RRSPs???? Not an option for many.
• The list goes on, many feel good ideas that end up driving up prices, but none are the main problem, all hurt though.

Short and long of it, low interest rates and demand > supply is the main factors, and the only thing that will burst the bubble. Some minor things can be done but they will not be total game changers (and maybe that is a good thing).

• Extra tax on empty properties, lets see how it goes but it might help for rental stock, easy to fake someone lives there by listing it as someone's address.
• Actually tightening up short term rental with real regulations with real teeth will help long term rental may also stabilize entry level a bit.
• Stepped capital gains (decreasing by year and 0% at five years) will weed out some of the small time flippers that fake "live" in the reno (basically list it as an address is all that is needed). This will also help entry level houses a bit.
• Get rid of any "student" foreign money loop holes tax wise.
• Better education in high school regarding finances!
• Reduce (relax), don't do, or get rid of most of my first list.

*****
As a side not on my second last point. Friend in Welland sold her semi for 400K (semi in Welland for 400K?!). She lost her job due to COVID and was forced to sell (moved in with boyfriend) but she made a good profit due to the market increases and the very nice renos she did. She took a good chunk of the win-fall and bought a new fancy pants pickup, cash!

 

[GreyGhost]

As a side not on my second last point. Friend in Welland sold her semi for 400K (semi in Welland for 400K?!). She lost her job due to COVID and was forced to sell (moved in with boyfriend) but she made a good profit due to the market increases and the very nice renos she did. She took a good chunk of the win-fall and bought a new fancy pants pickup, cash!

That is a really tough cycle to break. The vast majority of people are either cash-flow (if I've got it, I spend it) or investment people (how can I get more money into compounding assets). It is really hard for people to switch tracks either way.

My brother is on track one, he has given up on buying a house in the near future due to crazy house prices and used his down-payment money to buy a new truck. He has no pension or savings. He will likely have to work until he dies as he may max CPP but his wife will probably not even get close. Even with max CPP times two, you aren't doing well. I pushed him hard to invest the money so it would grow along with house prices and give him a chance in the future. His family "needed" a new truck as they couldn't possibly fit their two kids in the current four door truck (he also doesn't need a truck as that is just a personal identity thing). I showed him the numbers that the truck now was more than 1M less at retirement but his need for the truck exceeded his ability to think about tomorrow. He says he will rebuild the money and invest over the next few years (which I doubt it possible) but even if he did that, I showed him that the truck results in hundreds of thousands less at retirement.

You friend is probably track one, got accidentally dragged into track two when she bought her house and at the first opportunity firmly planted herself back in track one. Again, she could have invested that lump and taken years of required work off at the tail end.

I knew quite a few GM workers with all the toys. If they had $57 in their bank account at the end of the month, they would go to the toy dealer and ask what they could get for $57 a month.

Many people on track two go overboard. We've all heard of the old people that never travel and die with millions in equity. There should be some balance in life.

 

[Evoex]

They do have a Starbucks and besides, what's there to do in Toronto?

Pay an arm and a leg to watch millionaires play sports or sing when you could be a participant in a smaller community. If it was sex would you rather pay to watch porn or be a participant for free?

Toronto weather sucks. Winter: A skiff of snow to snarl traffic but not enough to ski on. Summer: The atmosphere and odour of an under-ventilated gymnasium.

Bragging rights:

Toronto: I have a million dollar house.

Timmins: I have a $500 K house and it's twice the size.

If they want to do something about housing they have to work on transportation. Look at a road map of North America. The USA's network looks like a spider web. Canada's looks like a tightrope.

Nothing to do in Toronto??? Going to emphatically disagree. I’ve spent most of my life travelling or living abroad and there are far, far, far worse places to live or visit then TO.

 

[Lightcycle]

That is a really tough cycle to break. The vast majority of people are either cash-flow (if I've got it, I spend it) or investment people (how can I get more money into compounding assets).
[..]
Many people on track two go overboard. We've all heard of the old people that never travel and die with millions in equity. There should be some balance in life.

Also some people in track two are either too impatient or have bad judgment, pouring their money into get-rich Ponzi schemes like Amway or Gamestop stocks, or gambling it away on other risky "investments".

They lose their money just as fast as the people on track one.

 

[GreyGhost]

Also some people in track two are either too impatient or have bad judgment, pouring their money into get-rich Ponzi schemes like Amway or Gamestop stocks, or gambling it away on other risky "investments".

They lose their money just as fast as the people on track one.

I guess there is a third track. The gambler. Take your scraps and try to win big to get ahead. Some use the casino, some use sports, some use Gamestop/Tesla, some use crypto. You aren't investing in something that creates value/innovation (at a reasonable rate anyway), you are just hoping you win based on psychology/luck.

 

[Lightcycle]

I guess there is a third track. The gambler. Take your scraps and try to win big to get ahead. Some use the casino, some use sports, some use Gamestop/Tesla, some use crypto.

In my mind, there's a distinction between a Ponzi scheme and gambling. In Amway/Gamestop, you are counting on the fact that there's a late-comer to the party that you can take advantage of, just like you were taken advantage of by the people who bought in before you.

In gambling, the only party taking advantage of you is the casino.

 

[GreyGhost]

In my mind, there's a distinction between a Ponzi scheme and gambling. In Amway/Gamestop, you are counting on the fact that there's a late-comer to the party that you can take advantage of, just like you were taken advantage of by the people who bought in before you.

In gambling, the only party taking advantage of you is the casino.

Fair enough. I understand your point but for me they are close. You are putting money in and hoping for an unreasonable return (at the expense of someone else).

 

[backmarkerducati]

They do have a Starbucks and besides, what's there to do in Toronto?

Pay an arm and a leg to watch millionaires play sports or sing when you could be a participant in a smaller community. If it was sex would you rather pay to watch porn or be a participant for free?

Toronto weather sucks. Winter: A skiff of snow to snarl traffic but not enough to ski on. Summer: The atmosphere and odour of an under-ventilated gymnasium.

Bragging rights:

Toronto: I have a million dollar house.

Timmins: I have a $500 K house and it's twice the size.

If they want to do something about housing they have to work on transportation. Look at a road map of North America. The USA's network looks like a spider web. Canada's looks like a tightrope.

Totally disagree...

The lifestyle needs to match the location, people try to fight that (try to live rural in the big city, live big city while rural) and they will of course be unhappy... but Toronto has lots to offer. Some of it costs money of course, but some not so much. During COVID obviously some are a no go...but will be one day.

If big city "culture" is your thing....

• There is big and not so big dollar fine dinning and of course lots of fantastic inexpensive multicultural dinning for foodies.
• Street meat.
• We have theatre, both the fancy pants and low cost, if someone is in to that.
• Real opera and ballet if that is your bag.
• Music clubs with indie bands, Jazz, whatever, if music is your thing.
• Plenty of clubs if you are into that scene.
• You can actually go for a drink with your friends without the need to DWI, many, many great pubs etc.
• Of course live pro sports and concerts like you mentioned....not all are big dollar if you avoid the beer and food.
• Not a straight white male, lots of places for you as well.
• Cultural events, large and small.
• Tourist crap, but no self respecting GTAer does that....
• Real education options if you have kids.
• Much more "retail" options....
• The list goes on and on.

Big city active...

• Toronto has some fantastic xcountry MTB trails, some of the best in the country if you know where to go, outside of BC and maybe QC. Many more outside the city proper.
• Pretty good paved trail infrastructure for biking, whatever.
• Lots of parks for just hanging out.
• Great hiking trails within the city.
• Bruce trail is a short drive away.
• Canoeing, kayaking on the Humber or lake (not as good as up north of course but still on the table).
• Lake Ontario for water sports, hanging at the beach.
• Lots of organized and semi organized sports for all ages, all kinds of options, some super low cost to almost no cost.
• Golf, if your wallet is fat in the city, but tonnes of affordable (for golf) within a hour's drive.
• No black flies!
• The weather is not all that bad but it can of course be better (but way better than Timmins).
• Downhill skiing a short drive away (but small hills if you compare to the west or QC of course).
• I see lots of people fishing in the city (even fly) but I would not eat the catch....
• Expand to GTHA and things get even better.
• Actual good health care if any of the above goes sideways....

Of course if all someone wants to do is camp, hunt, 4X4, dirt bike, snowmobile....(all are also cool) don't expect to happy in any big city. Same for many (maybe most) of the above list living in Timmins, people need to maximize their local for enjoyment.

 

[Lightcycle]

One thing I miss about living in a big city is availability and choice of shopping. ie. In smaller towns, not one grocery store is going to carry all the brands and products you like. We call it the "Supermarket Shuffle": buy most of your groceries at the cheap place, go to another place to pick up the bread you like, go to another place because it's the only place that stocks the spices you need. In Toronto, most of the large grocery stores stock a wide selection of brands and specialty items.

The big box stores (CT, Walmart) in small towns also tend to have empty shelves. Not sure if that's a COVID thing, but people around here tell me that this has always been the case. Got fed up waiting for a 1/2" to 1/4" socket wrench adapter to be restocked at the local CT, and ordered it via Amazon. Months later, they *STILL* don't have that adapter at CT. Common part, no?

Also, on the topic of commerce, stuff takes longer to get shipped out here. Order from Amazon (non-Prime), and it's anywhere from 7-10 business days. By the time stuff shows up in the mailbox or doorstep, I don't even remember ordering it!

On the flipside, the proximity to trails and nature for motorized vehicles and outdoor sports is sublime!