The effects of the downturn are beginning to sink in. People are being impacted by the long-term decline in property prices and the housing market. I recently sold my house in the Sacramento area, and I want to invest my lump-sum profit in the stock market before prices start to rise again. Is now the right moment to buy, or not?
Stocks with yields that outperform the market should be on your radar, as should shares that at least lag the market over the long term. But if you want a long-term strategy that works, I advise you to consult a broker or financial advisor.
Thats a good one. I know a lot of folks that made fortunes from the Dotcom crash as well as the 08’ crash and I’ve been looking into similar opportunities in this present market. Could this coach that guides you help?
Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
Yes he lives in his little bubble of world affairs can never effect me Go and get advice from a racoon at least it will tell you of the moronic dying Canadian system that is about to create the worlds wests worst food and fuel shortages. Mr current events here will tell you Canada is loved everywhere when in reality it is a worthless criminal haven/ breeding ground that stems from nazi party pasts to honoring nazis publicly While anyone who disagrees with them is run over on horseback and excommunicated via bank account subjugation and public disgrace. There is a reason Canada isn't allowed at UN summits and Global meetings. They are a disgrace and an atrocity to so called democracy it is nothing but a drug fueled tyrannical dictatorship run my drug addicts who now made it all legal as the death toll rises.
@@fsckool6894Debts were already piling up the moment people started paying a million and more for a simple looking townhouses or detached, you can't pay 3 or times more for an item sold at retail brand for 60% less and not expect to live in a ticking bomb of massive debts, think of this if your mortgage is $1 million dollars think of how you will have to be earning to pay the mortgage each month, even if you have a high paying job, you would look very poor compared to your peers down south, in addition not much will be left to spend on other essentials it all goes to your debt master the person who cashed in big the seller when the market was too high.
Jon. I love your posts. I really do think that, if we're all honest, the real reason house prices are so hi is the fact that money launderers are buying billions of dollars in Canadian real estate which drives up the price of houses. Add to that the fact that the government of Canada does very little to mitigate the situation despite the many warnings from its intelligence sources.
Yuppers, and they buy it through high-speed transactions. They don't even care about what they buy, they never see it, as long as they are buying. All shady transactions. Apparently large parts of US cities, farmlands etc are owned by terr0r!st groups, Putin and other enemies through shell companies. Is anything being done about it? No. One day we might wake up to the realization that a large chunk of SFH in the GTA are owned by terror group from the ME.
Anyone that thinks that housing will stay that low needs to give their head a shake. As soon as rates drop, prices will go back up. Over the past few years, the housing market has shown how much people are willing to pay for housing. It’s only a matter of time before prices go back up.
Those percentages dont make sense. Vancouver is far more expensive than Toronto and salaries are lower last I checked. Vancouver is only affordable for Chinese money launderers.
How are prices in other countries relevant to local situations? They all have different tax laws and regulations which doesn’t appear to be factored in.
CREA and real estate pumpers are pining their hopes and dreams on the BoC rate cuts. Don't be surprised to see ZERO rate cuts this year and a possible rate increase.
BoC isn't insane, in fact BoC is the Feds lackey. They'll do what the Fed does and then find a way to explain it. I honestly dont even know why we have a fiscal policy directive, just follow the Feds lead.
@@EricAlHarb I think this time there are fundamental differences that may have the BoC cut first. The big issue is that many Canadian mortgages renew in 5 year cycles, with a lot coming up this year, but the US mainly are made up of 30 year fixed, and don't reset. The impact is greater in Canada and the BoC may need to cut sooner than the FED.
@@arethereanyuniquehandles except they don’t have a house price mandate. Just an inflation mandate and a rate difference will lead to higher inflation. So no. They won’t go too far from the Fed.
Interesting, I rent in one of Toronto’s most desirable neighbourhoods, Riverdale, and have recently seen properties for sale that are listed easily 25% below highs, like 1.5 mil instead of 2, consistently remaining unsold…. It feels gloomy out there, but we shall see.
Maybe a desirable part of town, but is the home itself desirable?? Most homes look old and small for what they're asking. The days of suckers bitting baits are slowly waning, and their debt slavers will have to look elsewhere for smart investments in the real market.
@animeloverfan18 That's because at $2.2 million it's not a mansion or an acreage large new house probably some old tiny pad waiting for its sucker and ultimat debt slave 😆
vancouver prices seems remains the same, there were some older units that dropped like 10% and remains unsold, a few sold ones I tracked was sold around -5% to -10% below initial ask, but over-all, still around $1600 to $2000/sqr, newer units doesn't seem to be dropping price much. one unit was listed at highest 4M and sold for 3M, but that 3M still puts it at $2000/sqr, at 4M just means the ask was way out wack at $2600/sqr /. apartments are like cars, older unit maybe around 1200/sqr while new ones are like 1800/sqr, that's a 30% depreciation for apartments
Here's one for you Jon to lookup in Guelph. All semis 36 Simmonds sold for $1.2 million in 2022, 33 Simmonds sold for $975 K in 2022. 22 Simmonds sold for $1.085 mill. In 2022 32 Simmonds just sold for $725 K. In 2024. That's a terrible drop they all just got FAQED. 😮
Thanks for the data, a big fan of your channel. I’m hoping your forecast on future lower prices is correct, we need affordable housing in this country. I’m becoming less convinced that lower prices will continue. I’m not sure your data considers things like what the unemployment rate was during these historical events. This has a big impact on local prices. Your data seems Canada wide as it relates to interest rates. Another big missing piece from your data is immigration during those events. Things seem different now. Housing shortages will mute future price drops in my opinion and demand is high with investors sitting on the sidelines doing the math on rent prices to see when to jump in. I think even you are surprised at how little prices have changed in certain areas of the country. Would you have predicted a year ago that Calgary prices would be higher now vs the peak. Mortgage free home ownership is at an all time high these homes will not be sold, certainly not in a down market. Highly leveraged homes is now a smaller percentage vs historical. To summarize we have some unique aspects happening now that do not align with historical events. It might be worth taking your data one step further and see if these other metrics are available.
Very thorough analogy…..fantastic work 👍. I’d say….you’re spot on! These Toronto home prices are unsustainable especially with the condo glut and the higher city taxation on market value squeezing the mortgage holder’s.
Rates will not be lowered for a long, long time sir. The punch bowl has been removed from the party, and will be gone for a very long time. The unnecessary lowering of rates instantly to zero, overnight, during Covid, was possibly the worst mistake in the history of the BOC. We’ll be paying for that mistake for a long time. Good video, thanks.
It was not a mistake, I think they did it deliberately. At zero rates they got tons of money for their own shit. Otherwise there is no point dropping rates to zero at all.
Attaching affordability in major centres to income is asinine in equity driven markets…. No one is buying the median home price with a minimum down payment. What a joke. Comparing the average first time home buyer purchase amount to income would be more relevant.
@@wideback4553a lot of losing jobs is a symptom of recession. They cut rates when shit hit the fan. What Jon saying is even with rates cut, the momemtum is still down and it takes in general 12-24 month to see the effect of cut rates.
Unfortunately the income is not going to double over night, which means some people will lose their homes. People are already struggling with mortgage payments.
Bought in 2019. Just had to sell because my mortgage was about to jump $852 a month. My wife is home with the kids and we can't afford it. If you look at many of the homes being listed in our area, many were purchased either 3 or 5 years ago...
The problem with this is. Is that our idiotic gov along with banks can give those poeple 30 year mortgages so it essentially won't impact those people much at all unfortunately. I'd like to see mortgage rates up to 10-12% instead of the 5 we are at.
Love the optimism but prices and or affordability aren't going to go down in a way that makes an impact to regular Canadians. At best, it will be a slow grind down until BlackRock is on balance and adequate competition has been consolidated. Then they will take the market up again and dump on unsuspecting citizen buyers. Rinse and repeat until they own everything. The housing market has been captured by big money and they will treat it just like the stock market going forward. When they say we will own nothing and be happy, they mean it. Except the happy part.
Government bailouts such as mortgage payment deferral option during covid and the current negative amortization relief have so far managed to avert the necessity of forced home sales. These bailouts have direct impact on the supply.
Love the honesty backed with data. One thing i don't think you took into account however is the supply issue. There are many buyers on the sideline eagerly waiting for any drop to take place. While I agree interest rates are going to take care of a few borrows stretched, the supply crunch isnt getting any relief for at least another 18-24 months. Until then new buyrs will take advantage of lowering interest rates, keeping prices sideways or higher imo...Despite that said, i'm one of those buyers on the sideline eagerly waiting and hope prices crash like they popped in 2021.
They are popping... I am also on the sidelines with cash and I feel like I missed my opportunity when I login to HouseSigma every day and check my list of +700 listings and see how quickly everything is selling and now for listing price, some over asking and a few for a tad under asking. Prices have not even corrected downwards in some areas like Northumberland and just keep going up. I feel like throwing the towel in, but what good is a pile of cash to me and being stuck in a toxic, unhealthy apartment. So far Jon has been wrong, prices are moving up, multiple offers are back. I put an offer in for a house nobody cared to view for 7 months, visited twice and thought let's give it a try and boom, another offer came in from nowhere. So WTF is going on? Who the hell suddenly put an offer on a house nobody seemed to want but me??? Well, my offer was not "strong" enough as the agent said, meaning "you should have thrown another $50-100,000 in...". So yes, insanity is back and a crash does not look likely, however much many of us wish for one as prices just seem to get more and more ridiculous.
I'm no expert, but the shortage of available properties due to mass immigration likely will not drop the cost too much. Year over year many areas are now slightly up after bottoming last Jan, and some provinces are even up as high as 20%, interest rates or no. The only thing keeping people from buying is rates are predicted to drop. My place in Ontario is still up by 30% from 2021, despite having dropped 20% from the all time high. Despite my thoughts, I hope you're right.
This is what i think too - if they lower rates prices will start going up again. The 2yrs of rate pain was for nothing. We need rates to remain where they are with some small increases. We do need the prices to drop an additional 30-55% this may take time. Only then and after some time small and infrequent rate declines . what do you think?
One would have to remain employed in order to continue slaving away their hard earned money to payoff a hefty Morgage on an old tiny house @@rosatipicks
This doesn't make any sense, Canada is different from the other countries you mention. We need to ask ourselves why the prices are so high in the first place? Lack of inventory compared to incoming imigration, there is just not enough suply for the demand, that's why prices are so high. The only way to regulate is to construct way more apartments, more than the numbers of new immigrants, or to control the price of the square metter on top of prohibiting over biding. If you think prices will drop in the next year, you can wait forever. Especially once the rates drop, the biding war on big cities is going to go crazy.
Don't think the prices of houses are going to drop enough. There are too many factors on why they were increasing. Money laundering Over leveraging mass purchases International students Big corporations buying Foreign investment Rich kids/parents passing on houses or buying more. You should look at Sarnia ontario. For peaks and compare.
40% are investor purchases in Toronto... Vancouver is mostly CCP money... I see it happening. Investing is all emotion. When losses go over 30% they head for the door. STUDENTS are not coming... these slumlords with greasy mortgages will go pos. Will be an interesting year.
I see your data and your argument (well made and logical), whats not part of that data is real-estate agents hype that of the media and even the Inet and panic buying by people locked out of the market and people refusing to lower prices. My friend put in an cash offer on a piece of land he know what the buyer got it for and is offering well above. its been on the market for 8mths with out a offer and its pretty remote. the seller still thinks things will jump up again and will not budge. thing is many bought remote for the better price and they could work at home thats changing but the attitude is not on average - I truly hope prices drop would love to move all this is slowing down my changes but I dont have high hopes to much greed
Interest rate normalization, would have prevented the real estate boom. 6-8% normal. Real estate needs to be slightly less than usa real estate prices. The short term rentals has skewed the real estate sector. Investors, low rates, and new short term rentals.
just goes to show how bad the economy really was from 2010 onwards, they had no choice to keep rates low or we would've entered a depression. I think all they did was delay it.
I really hope your right. If not I’m going to beee to leave Toronto. I even started an only fans in the Hopes to raise enough for a down payment. I’m hoping their is a market for a Middle Aged bald man with a gut. So far i got 1 sub.
Either home owners are loosing some equity, or we are all dealing with inflation (wage-price spiral), or some combination of both (stagflation), there are no other ways around to fix affordability.
This time is different John, both private and public debt are at historic levels, inflation, increasing taxes, 2 maybe 3 wars spreading and the biggest recession I will probably see in my life will have a much bigger effect than when your 3 friends bought. My personal and humble opinion is 2027 before we bottom at minimum. What would blow my thesis, the biggest bailout we've ever seen of the Canadian homeowner or the biggest inflow of foreign money trying to leave even worse conditions elsewhere.
47% of the homes sold in the GTA last month. Empty or Tennanted. That's up 50% over last 10 years to a peak. What does that mean? Homes bought to flip, then rent, are now hitting the market. As landlords are paying $2k to have someone live in the home/condo. Rest assured, there will be a rush for the exit. Once people realize the next chance to sell is in the fall. Lol😂. Spring market is going to be met with higher rates and falling prices.
Problem is the cost of building a new home sets the selling price for all homes. A new home builder expects to sell what they build for the costs plus labour & profit (their wages). When you purchase a preowned home you may spend a little less, but the price is more about replacement cost. A buyer is willing to spend a certain amount for a used home instead of paying the price for brand new. And the sellers need to make a certain amount in order to buy their next home. If the used home market drops drastically, then new home builders will not be able to sell their homes at what it costs them to build, so naturally they will stop building and the inventory will go down. Then what do you suppose will happen to the existing homes for sale (supply and demand)? Adding to that is the rapidly increasing price of land (again, supply and demand).
I renewed it recently. Went up 40% from $500 to 700 per month for a condo in downtown mtl. It doesn’t look that huge but later realized that it’s 40% more.. Oh well..
God forbid it happens like you predicting majority of people that own a home would go bankruptcy. This is unbelievable I don’t think this is gonna happen. What do you think?
That's what I keep wondering. These overpriced homes within 200 km of the GTA are garbage quality or quick fixes. I have seen 50+ in the past 2 years and am having a hard time parting with my hard-earned money on a garbage quality home, yet I see these homes keep selling for what they are listed for, or a tad below or above. It's nuts. Wondering if Tricon/Blackstone is on a binge with taxpayers' money and buying up everything in sight? Even our CCP is invested in these thieves. Citizens should have a right to demand our CCP not be invested in such criminal corporations that are pumping the RE market up and stealing homeownership from future generations.
I live in a 2 M dollars houses neighbourhood, houses still selling however three families are living in one house recently sold. We have seen nothing regarding how creative people will become in order to get in the market.
@@elim7228The house will win if you let them have your money, buyers have a choice, you can walk into a car dealership and decide you ain't buying an old car if it's way too overpriced, same with a house it doesn't remain the same with constant usage and occupancy things fall apart and even neighborhoods get worse with time passage.
House price never drop to 30-50 percent May be 5% I’m in the housing market over 40 years my first house I bought $25 thousands and look at now after 40 years later
I agree, I would of thought a higher drop percentage for Vancouver.,prices are insane here and we haven't dropped as much as Toronto has the last 6 months.
Most Vancouver homes are investors cash purchase without mortgage hence interest rate increases has no relation, whereas in Toronto most homes have mortgages and interest hikes has gone in thier daily blood stream
alright ! Jon my man ! They will try to have a soft landing, but the system needs to be cleaned up a good spring cleaning, restructure etc.someone needs to pay for this mess. St-Arnaud (pronounced = Arneaud ) don't pronouce the D
Thank you for such an insightful analysis on the current housing market dynamics, especially focusing on the impact of interest rates on housing affordability and market trends across Canada. Your detailed breakdown of the relationship between house prices, wage increases, and the historical context of interest rate adjustments provides a clear and comprehensive perspective on the challenges and opportunities within the housing market. It's particularly interesting to see the data and examples you provided, highlighting the lag time in the effects of interest rate cuts and how they correlate with housing prices and mortgage arrears. Your analysis not only sheds light on the complexities of the market but also offers valuable guidance for potential buyers and investors, emphasizing the importance of timing and economic indicators in making informed decisions. Looking forward to more updates and insights in your future videos.
Nice background. Life has indeed become one big Monopoly game. Never liked the game as a child and the older I get the more I feel like walking away. Round and round the board we go until all wealth is concentrated in the hands of one person and everyone else goes bankrupt--yes, a really fun game!!!!
Yes and Banksters cheat, lie and have “get out of jail card”. Example 2008 great financial crash. Not one North American Banker went to jail. Just paid fines to government. Meanwhile America Real estate tanked. Canada survived due to Harper propping up the banks ,and high natural gas, oil prices the Canadian economy was saved by Alberta oil/Gas industry.
The only way to make house prices reasonable is to impose a capital gains tax on houses. This will deter investors from the housing market. houses are for living.
The last two houses I sold in Scarborough were bought by Chinese individuals and were registered under the names of their employees who were poor. The realtor informed me that the original owners are in China. my chinees friend with large families bought house for each family but he was not rich.
How the prices going to ever drop with the Borders open? People are forgetting that Canada doesn’t require visa to new comers. So good luck with a 50% price drop.
In 2014 I was 33 and had close to 30k saved up for a down payment on owning my first property. I hesitated due to very cheap rent I was paying in a great neighborhood (The Annex) that was super cheap ($1100/ month) and not wanting to be tied down to Toronto due to the garbage winters. FF to 2024 I’m now 43, still renting and due to the disgraceful housing market here, will likely be renting the rest of my life. Anyway I wanted to let you know I still watch all your videos since discovering your channel despite being an observer and not a participant in the market . You seem like a rare genuine personality in this space and I’m patiently waiting for the housing bubble to pop and hoping you’ll be the one to point it out in a future video ;) For perspective, rental prices in Toronto have literally doubled since those days in 2014. Wrap your head around that… a 100% increase in just 10 years.
You might have saved up more and invested in yourself or made capital gains from stock. Importantly no headache of expenses of fixing and time loss. Maybe it was better for you depending on how we see it.
I think we all have to wake up and realize that dirty money is unnaturally driving ip the prices of homes in Canada. The sooner we realize this, the real problem, the quicker we can address it. I highly recommend the book "Wilful Blindness", by Sam Cooper. This book chronicles the reasons our kids can no longer afford to live where they grew up. It should be mandatory reading for all Canadians.
Although you may be right that prices need to drop 35%~50% to be affordable there's an old adage that says prices can remain irrational longer than you can remain solvent. Nobody in "The Powers That Be" camp want prices (collateral) to drop: Central Banks, Lenders, Politicians and CMHC. Even your average lackey Canadian homeowner does not want house prices to drop. They just have not got their head around the fact that they get poorer as home prices increase. What? That's right Klink Re: Property taxes.
Based on the charts you presented, I agree with your analysis. But, is it fair to assume that the crazy immigration numbers and the associated demand for housing will keep house prices high till the demand for housing is met?
The American CPI came in hot yesterday. I have no clue why people are expecting huge cuts this year and I think it was crazy that the Fed even mentioned rate cuts. I won’t be surprised if we see no cuts this year. And when they do start cutting it will but because the economy will be in recession. Great charts Jon. How in the world do people get mortgages at these prices?
At 28 living in the Okanagan, I imagine my only opportunity is a massive cut in population as sick as the idea is. Be it all out war or illness, I cant see things getting better for me. The sad thing is, I make well into 6 figures and cant see myself owning a home in this market or future market
This doesn`t account for supply and demand. Back then things were balanced, now supply is really low and demand is really high. This will drive prices up.
Jon do you know any RE agents in BC that reflect your same honest views? I'd like to follow any one that you recommend, the area covered does not really matter its more about the honesty. Thanks a million!!
As a home owner I don’t want my house value to drop. No home owner wants that. That will cause many to lose their homes because the banks will want the difference paid if mortgages were higher than after house price drop. So, it must be higher wages. But ai will reduce jobs. Outcome? Crash or add a minimum income plan?
Current Canadian housing prices are simply unrealistic the market cannot support itself if they continue to insists on higher prices no discrimination on types of homes age, and where they're located within the selling area.
That sounds like some good timing. Around 12 months is when i expect crypto markets to top out, would be great if housing market was bottoming at the same time. Any smart investors would sell all their housing stock, put it in crypto for a year, then buy the houses back at a discount with their gains.
I think it will be worse then that. It 75% in arizona. Canada is pumped 3/4 times what they were. I bought a house 48 of 50 homes held by the bank on the street.
The only mix might I add was I remember when post 2008 in Victoria the market was very soft for a long time. Probably at least 4 years which your chart agrees with. But only issue we have right now is places like the west coast etc. are experiencing extremely low vacancy rates. Some towns I follow such Tofino/Ucluelet/Squamish/Chilliwack have literally nothing to rent out unless you want to pay an arm and a leg. Now I know these things take there time to work through the system but I don't recall record low vacancies in 2008/2009.
Exactly! That market cycle peaked when there was an oversupply of housing. Starts dried up for 4 years. Then returned to average. That 4 year under supply years are why we are under supplied today. No houses on market, sellers market.
Since December prices gone up in st catharines. The last 3 weeks houses are getting sold quickly. We are seeing people competing on homes and sellers are holding offers. Please explain?
Very informative and valuable video! Thank you. Would love to hear your view of real property prices now compared to data in 2019, prior to the pandemic. How much has it changed?
Mortgage applications are way down sales are way down and it’s no secret that Canada runs a good portion of its economic engine off of real estate, I can see a negative feedback loop coming from everything including real estate brokers through to Home Depot. The reason being is because there will be a knock-on With less homes being sold, less furniture being bought less financial services in the banking industry obviously less real estate agents, less moving trucks less advertising for real estate companies, and all the other companies associated with real estate. Nobody seems to have handled this yet in a video, This might be something you want to look at. Cheers,
I see the charts in which home prices decline as rate cuts start, but I'm struggling to understand the logic behind it. Can anyone recommend something I could read to understand it?
here is my Thesis. Supply is so short and everyone is desperate. The bank of canada will be fedup and will end up lowering interest rates. And that will be the beginning of the last frenzy. Home prices and rent will shoot to the stars, people will have less money to spend on the rest of what the economy relies on, businesses will start shutting down laying off people with mortgages, supply will increase in a time where not many can buy, home prices will go down, and a lot of people will end up with negative mortgages and go bankrupt... and welcome to 2008, Canada version. Now the question is, how long this is going to take?
Thank you for another very informative video . In Ottawa there are still bidding wars for anything that is even remotely reasonably priced. I don’t know where this is going to lead …
Bidding wars. Nice. In WW1, initially people were lining up to get conscripted to the front lines. Noone wanted to miss on the action. But after that, something happened and everything flipped....
It doesn't. Ie he is a realtor/broker/or upside down owner. Once the spring market pukes and people realize the next chance is fall it's really going to accelerate down. As inflation re ignites and rates rise. Not fall. And 100,000 home owners a month get a wake up call. Reality
People started sniffing rate cuts last year, multiple offers have come back but prices went down not up from December to January. So dont think you got that right. Now mortgage interest rates are going back up, not looking to good for sellers.
