Why are homes so over valued to the point that the average family cannot afford to buy one anymore (new buyers)?
Is this the era of rent-slaving?
Why are homes so over valued to the point that the average family cannot afford to buy one anymore (new buyers)?
John Lewis
Ayden Flores
Canadian dream "is over" for next-gen says Fortress exec
>Writing for the Huffington Post, he calculates that if the pace of price growth continues over the next 30 years, today’s children will be facing a price tag for a single-family home of $11.5 million in Toronto and $45 million in Vancouver!
Nathaniel Brown
> homes so over valued to the point that the average family cannot afford to buy one
Wtf you talking about?
You can get yourself a home in Detroit for $5,000.
Nathan Flores
UK, AUS, NZ & Canada
Not third-world US
Charles Reyes
Detroit property taxes will fuck your shit up
Nathan Butler
I fucking hope so. I own some residential properties in a European capital city. Value doubled in the last decade. Rent up only 12%. Shit sucks. I want to continue buying properties but I'm down to less than 2% ROI even with doing all the work myself and that's not even acounting for interest on loans.
We have too few appartments for the evergrowing population so property values skyrocket, but at the same time rent is either capped by rent control or you find no tenants because the evergrowing population is the result of poor people immigrating.
rent *needs* to go up to match the property values, but yes, this means the average family will spend more than 70% houshold income on rent-slaving.
Benjamin Richardson
Basically, no one thought that they should build buildings to sustain population, so prices are kept really high. If there were more houses and apartments being built, this wouldn't be a problem. Hopefully as technology improves, so will the amount of time it takes to build something.
William Kelly
Higly desirable areas dont have enough units. Low density areas have too many units. Foreign investors use it to store wealth. Developers aren't building for tenants anymore but instead they build for investors. Foreigners should not be allowed to own property in the us nor canada. It would fix like 30% ofthe problem overnight.
Landon Walker
I don't know if I buy this, at least in western Canada. there are quite a number of "luxury condos" in the 1200$+ range sitting empty. a friend of mine rents one and his building is 60% empty and has been over a year.
prices are sticky and slow to move here, but they are moving. most of our stock is 40+ years old and doesn't deserve a 1k+ rental rate, more like 600$. vancouver may see a correction from the tax. many say it's already happening, do your own research. toronto is getting bent over and will for some time. but I live in the west and I'm looking to rent a house right now, there are THOUSANDS of main levels/basements sitting vacant well over a month now. with the large number of mortgage-holders trying to be rentier landlords I think this could cause a large downward trend. vacancies in edmonton are close to 9% iirc.
lots of incentives, reduced rents, I think with the presumed high rental rates it will induce insolvency for many of these people fairly quickly. losing $1k+ per month and more if you're heating a house will eat your lunch pretty soon if you're heavily leveraged.
I'd like to think rentals are a leading indicator. canadian average debt is high and climbing, but over half of canadians don't carry any debt at all. so there's a weird division in wealth and debt and it's hard to gauge because data is hard to come by.
our dollar will probably drop another 10c us if the us raises rates this month. that will be a factor in toronto/van but not elsewhere.
Jeremiah Lewis
I think a lot of it is because of too-lax lending standards.
check this out
www.greaterfool.ca
Wyatt Clark
>implying that large cities aren't due for a correction
That being said, land in rural areas should see a substantial increase in the next decade if foreign investment keeps on trending
John Morales
sounds like an exceptional problem, limited to canada. That rate of price growth isn't going to be very relevant to other areas.
I think I saw a video on this some time ago, the problem is rich chinese moving to canada.
sbs.com.au
Hm. When poor immigrants flood a country, that country's citizens usually complain that 'they're taking muh jobs'. When rich immigrants flood a country, apparently the result is 'they're taking muh housing'. I guess white people can't catch a break, eh?
Seriously though, the solution is better city planning, and willing to compromise your views on the topic of destroying 'beautiful nature' to place more housing.
Hudson James
People here do not know shit. Its fucking pitiful for a board supposedly about money & finance. This is kitchen gossip-tier.
>muh immigrants
>muh chinks
>muh too few houses (Ridiculous, ever compared skylines between 1980s and today? There are new houses sprawling everywhere.)
Central bank interest rates are at an all-time low all around the globe. This means that people with good credit rankings can borrow money at very low interest rates.
All this money is then invested in stocks and real estate. These investors own more than ever, they have more access to credit than ever, so they have an easier time than ever outcompeting your average stock/real estate buyer and can offer sums your average family will never see.
At the same time, the exploding private wealth of the upper class and stagnating incomes for most of the population mean that there are very few possibilities for consumption growth. Therefore, investors buy things that people have to consume regardless of their income: living space, real estate.
Cooper Ortiz
Not if you live in shitholes like I do.
20k home
10k rental
Working on 30k or so house.
Meh. Sucks the long dick. Even worse than renting. But if I get drunk and knock a hole in the wall or wanna put a new tub in I can.
Jason Hernandez
The price of desirable houses goes up according to how much people can afford to borrow. So if wages go up, house prices go up. And if interest rates go down, house prices go up.
The best solution is more land tax. And building more houses and better transport links also helps a lot.
Xavier Watson
But with an fha loan you only need 3.5 down
Carson Edwards
Wages in Canada have been stagnant for like forty years. The divergence will correct eventually as outside speculators observe a downturn. They don't buy into downtrends, not in a commodity country like Canada.
Eli Ward
Did you know that outside of Toronto and Vancouver the housing market is pretty good in Canada ? Not everyone lives in Asian Columbia, and Toronto is basically the canadian equivalent of NYC in terms of QOL... no one takes NYC housing market as an US reference, so why do people do this for Canada ?
Housing market regulations are subject to local legislatures because property is a provincial right (92(13) LC1867)
Carson Rogers
COL not QOL*
Parker Williams
Our housing market isn't good though. Even ignoring those cities prices are high. I live in a shitty town of 15K people that was voted the worst place in Canada to live and even the shittiest house costs 200K here.
Cameron Miller
>no one takes NYC housing market as an US reference, so why do people do this for Canada ?
because unlike newyork, a good majority of canadialns are from toronto
Gabriel Morales
>lives in a place that was voted to be the worst place in Canada
>is surprised that the housing market is shit in that specific city
canada has 36m pop
toronto has 2.6m pop
vancouver is roughly 13% of canada
Anthony Green
>vancouver is roughly 13% of canada
Easton Peterson
nyc has 9 million
usa has 320 million
9/320=2.56562%
detroit has 0.6 million, 0.18% of our popoulation
miami has 0.4 million, 0.12%
san francisco has 0.8 mill, 0.25% of our population
canadas few major cities make up a far larger part of it than america's do
its not even on the same magnitude
Grayson Howard
>Is this the era of rent-slaving?
Rent is a return on an investment so it depends on whether rents are rising with house prices.
Hunter Morgan
Implying there isn't a bubble that will pop and the Canadian housing market will crash
David Sullivan
average home price can be anything
that doesn't mean people will buy it
also prices will slump if no one buys
Owen Bennett
>Wages in Canada have been stagnant for like forty years.
The average wage has risen by about 50% in the 21st century so far. Meanwhile interest rates are much lower than they were then, let alone 40 years ago.
Kayden Hill
adjust that to cost of living and inflation and then kill yourself senpai
Ayden Cruz
Is this for real dollars?
Elijah Cruz
It's crazy that Detroit was once one of the finest city's in America.
Nolan Hill
listen to e michael jones. the US govt intentionally gutted detroit, as well as other cities, to make america stronger.
Brayden Thomas
I posted the dollar amount, not the inflation adjusted amount, because this thread was not discussing the inflation adjusted price of houses.
Jackson Price
buy a tiny house instead ;^)
Blake Martinez
It overwhelmingly is foreign buyers though, you can go to any auction in Sydney/Melbourne and it's overwhelmingly Chinese. Boomers have long held lots of property even before the record low interest rates we've had at the moment due to tax incentives.
It's very much partly hot Chinese money being off-shored where it is more secure and can't be cracked down upon.
You are right that the actual physical housing shortage meme is incorrect though, a lot of these investment properties are vacant.