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evandyk said:
"There’s a listing for a detached home near Avenue Road and the 401, ... priced competitively, ... but there’s little activity in terms of offers from buyers..."

Ummmm... maybe if nobody is offering to buy it, it's not competitively priced?
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Unfortunately, we've created a moral hazard-free environment where anyone who buys real estate does so with the assurance - no, the certainty that they will profit off higher prices. It's complete insanity.

Our cowardly political "leaders" are now catering to these "investors" with no sense of risk management. Retirement funds for the landed gentry, fuck the unwashed masses. Let them fail, I say - maybe we'll all learn a lesson on economic management from this shitshow.

Or maybe not, if the current governments' (at all levels) actions are anything to go by. /sigh
 
DirectionNorth said:
Retirement funds for the landed gentry, fuck the unwashed masses.
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Let's not forget that about 2/3 of Canadians and half of Toronto are owners, including plenty of first time buyers (the second largest group of buyers) barely holding on. So it's inaccurate to frame the issue as one of a small group of owners screwing the "masses."

The problem with letting housing crash is that the entire economy has become dependent on it. Meaning we all lose our jobs if it does. Not a good alternative even given the current situation.

All of which makes the issue more complicated and even tougher to fix.
 
Undead said:
Let's not forget that about 2/3 of Canadians and half of Toronto are owners, including plenty of first time buyers (the second largest group of buyers) barely holding on. So it's inaccurate to frame the issue as one of a small group of owners screwing the "masses."

The problem with letting housing crash is that the entire economy has become dependent on it. Meaning we all lose our jobs if it does. Not a good alternative even given the current situation.

All of which makes the issue more complicated and even tougher to fix.
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The right time to crash prices was five years ago, and the next best time is now. It's a Ponzi scheme, transferring costs from new buyers and renters to sellers (I'm not convinced that regular people actually benefit from the bubble, rather than having the perception of having benefits); you don't help more people by keeping the scheme going longer.

When immigration slows, or people emigrate, or we see economic stagnation from low interest rates (compared to the US; see the BoC's rate cuts) and poor productivity (from this shitshow), then the music will stop. Maybe we won't regret the crash when it happens, but I doubt it - we'll wish we did it while the economy was good (so late 2010s or 2021-2022), and the effects less painful.

Pick your poison.
 
I doubt existing renters will fare well when a bunch of owners foreclose and are forced to rent on top of existing demand.

Fundamentally, we need to get away from a consumption, endless growth economic model which creates perverse incentives to create bubbles like this.
 
Undead said:
I doubt existing renters will fare well when a bunch of owners foreclose and are forced to rent on top of existing demand.
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Good tenants, those who can afford $3k or more a month, who pay on time, cause no fuss and care for the property will always have a place. These are the golden, cherished tenants that every landlord covets.
 
Undead said:
I doubt existing renters will fare well when a bunch of owners foreclose and are forced to rent on top of existing demand.

Fundamentally, we need to get away from a consumption, endless growth economic model which creates perverse incentives to create bubbles like this.
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You’re missing the point - the correction will be painful, and it will be more painful the longer we hold it off.

A bit like an addiction.

A correction would not have been a big deal in 2010, and not a big deal outside Vancouver in 2014, but we’ve made unbridled housing growth semi-official government policy.

The crash is going to come, and it’s not going to come when we want. We should have burst the bubble and eaten the loss while the economy was good and we had some control over its direction of impact, but the longer we wait, the less control we’ll have.

Undead said:
Not wrong, but now you're just playing into DN's "eff the masses" point lol.
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Everything wrong with housing in one sentence, and we still wonder why people are mad.

Nobody’s going to work in the morning planning evil schemes to screw the worker, but through willful ignorance, this is the effect of the policy they’ve coordinated. Or not coordinated.

Hence my statement.
 
DirectionNorth said:
You’re missing the point - the correction will be painful, and it will be more painful the longer we hold it off.
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I'm missing nothing. I've been well aware of this for years.

I think the point is that this issue has become a lot messier and harder to resolve because we've let it fester too long, as you mentioned. But that's water under the bridge. Today, it's no longer as simple as letting it all crash which may cause many people to lose their homes and jobs.

That's all I'm saying--it's no longer as simple as "just let it all crash/burn."
DirectionNorth said:
A correction would not have been a big deal in 2010, and not a big deal outside Vancouver in 2014, but we’ve made unbridled housing growth semi-official government policy.
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If you check my post history, you'll see that I've made this exact point multiple times.
 
At the size people want if they're going to live way out there, construction costs make that very difficult. And obviously what people "can afford" is a lot different when you're getting a mortgage at 6% vs 3.5% That $5,000 monthly mortgage they mention gets you $1M two years ago vs $800K today.
 
People are doing the math, and realizing they come out ahead with renting. On average, the difference in Toronto/GTA seems to be about 1500-1800 per month (comparing renting vs mortgage for the same unit). As long as you are putting your down payment and that difference away in an average ETF or S&P indexed fund, after 25 years you come out ahead, and that doesn't even take into account condo fees, taxes, lawyers, land transfers, replacing appliances. I don't think there is any reason for anyone to buy right now. If you look at the last 3 days sold you'll see we're back down to the low 400s for 1beds in the GTA, and some listings even going below that.
 
Whether or not you come out ahead depends almost entirely on the rate of return on the house/apartment you buy. And, of course, your returns on the index fund are taxed, while your returns on a primary residence are tax-free.

Anyways, I hope the returns on houses are crap for the next decade, making your post completely true.
 
As long as those condos are still being rented out while they fail to sell, they're still contributing to housing.

What people can afford has changed considerably over the last two years, which is shorter than the timeframe most developers operate on.
 
evandyk said:
As long as those condos are still being rented out while they fail to sell, they're still contributing to housing.

What people can afford has changed considerably over the last two years, which is shorter than the timeframe most developers operate on.
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Developers were rarely building for housing, but for investors whose primary goal was to purchase low, wait for appreciation and then flip for a profit, often times while leaving the units empty. That's why so many units are tiny, with sh#te layouts and views. Just look at these below, clearly not made to live in, but just to maximise the space for investors.
Screenshot 2024-07-04 105106.jpg
Screenshot 2024-07-04 105139.jpg

torontorealtyblog.com

What's With The Shape Of New Condo Floor Plans?

For those condo enthusiasts who appreciate a "square plan," you won't believe what the "future" of condo floor plans has in store for us...
torontorealtyblog.com torontorealtyblog.com
 
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