The banks are propping up the market with extended amortizations that is correct but it's not for the reasons you believe. The banks pretty much all have a base case scenario behind the scenes which they don't share with the public that's sees real estate values declining via a slow steady burn. What this does is save the banks while the individuals still get hurt. If all the people on extended ams had to stay within the original amortization over 20 percent of homes would be foreclosed on which would cause prices to drop 50 to 75 percent within 12 to 15 months putting the banks underwater on 70 percent of their book. They will not let that happen instead they are able to get out ahead of it by having to deal 5 percent of these loans this year another 6 percent in 2025 and another 9 percent in 2026. During this time period many will have to sell and many will find solutions to keep their home and some will be foreclosed on. They are preparing for a decline in prices of 20 to 30 percent between now and 2027 and stagnation after that for the rest of the decade. They will shift the issue from their books to the consumer through this exercise by controlling the downfall through a slow burn rather than a crash. The 30 to 30 percent is mostly GTA many areas of the country will only see 10 to 15 percent adjustments and some none at all.
It looks like this fall market is turning out to be a fire sale, especially for properties that aren't absolutely perfect. I think next spring will be a really interesting market. Will buyers come back? Or will the market fall again? I think sellers will have come down to today's prices by then, but the question is if the buyers will be there at those prices or not.
The prices of RE have doubled and some have tripled in the last 8 years, which is absolutely insane! The prices they want for their crappy houses should be what we pay for a mansion, it's just ridiculous!
It's a buyer's market in the rental market as well!! Got to lower prices on rents as well or make your rentals nicer. Tough times for everyone....is it true that Ravi started to win???
Strange. Asking 200k over asking than the market value is not insulting to the buyers. No realtor talks about that. But if the buyers offer 200k less it suddenly becomes insulting to sellers. Every realtor talks about this. 😅
I agree, some Realtors say it's not ethical or like you said insulting. Yet selling your home way over asking with no conditions... completely acceptable lol, honestly buyers shouldn't care if the low ball offer is "insulting", sellers don't like it, don't accept it and move on...
The problem is many sellers saw the frenzy of prior years and how much homes were selling for. Unfortunately they aren’t accounting for mortgage rates going down to a historic bottom which is likely to never occur in anyone’s lifetime. So you can’t look back as that’s how much your home was worth and should sell for now. People are too stuck thinking of that difference when they should be thinking about the home could be worth even less tomorrow spreading that gap. It’s also crazy to me how greedy people have become scoffing at making over a million on their plain average home when they would have been more than happy making half that when homes were barely appreciating yoy.
it's not just real estate, it's how the whole system works. Need to and what will happen aren't the same thing. The government will continue on with the bubble...
My mom's semi-detached house in Regina sold in 2 weeks...I guess it was priced right! The market is heating up over there as well. Houses are staying on the market for 45 days+. It seems like people are tired of paying the ridiculously high prices of the large metros.
This is an additional problem we notice in the Abbotsford-Chilliwack area. Prices are no longer differential between closer in to Langley-Surrey and Chilliwack. For example, A two bedroom townhouse in Chilliwack (of a specific quality) is priced close to the price as the same quality of two bedroom townhouse in Abbotsford. Historically there's been a price differential, and a benefit to moving away from Vancouver. And there's always been a price differential between Abbotsford and Chilliwack. Right now the price differential is really small. It's either become more desirable to live in Chilliwack than Abbotsford OR the price reductions are stickier in certain areas.
It was 420k down to 400k so your right around 5 precent reduction. Still pretty good cuz my house is appraised at 350k but mine is renovated better. So who knows?? 🤷♂️
I guess it’s if your house is renovated or not cuz the house down the street hasn’t done anything and listed at 320k and been listed for 2 months now. It’s smaller too tho
People don’t really understand who’s Vancouver buyer , except for people wanted a quick profits from before most of Vancouver buyers are people with money and no need to sell for long time so don’t expect Vancouver real estate to be any lower any time soon . Any other parts of Canada is not guaranteed
Hey Tom, you gotta remember that community housing would most likely qualify for the CMHC MLI select program where they would get a reduction in rate and up to a 50 year amortization.. so yah they probably overpaid , but their monthly commitment was most likely lower than if it was a regular apartment building.
Good morning! Happy Sunday. Is the bottom near for Canadian real estate or could it get worse from here? *The back-and-forth that Steve and I had at the end of this episode was not real life conversations with sellers. It was a list of the most common things people bring up as why their home is more valuable then someone else’s*
Before the bottom capitulation happens as per free market theory. Then again, real estate is not a free market here. Heavily controlled by gov policies. We may see bottom somewhere around Q4 of 2025 and then stagnation. When will the price come back ? It will when the economy booms and there is a growth in onhand income for people. Till them stagnation is the only way. We should study abt Japanese RE market since 1990. And yes, congratulations Tom & family! 🥳
I feel Canadian real estate has a ways to fall. Having lived through, and barely survived, the GFC of 2008-10 and Dot Com in 2001-2003, I think this is only just beginning. The lag effect takes years to work its way through and people are just starting to realize how bad the Canadian economy is, in spit of all the rhetoric coming from all levels of government proclaiming how great things are. The top 10% are doing just fine, the other 90% are getting pounded by inflation, insane housing prices and excessive taxes. QSS
@@sharinglungs3226 inflation will be lower so a rate cut of 50 or 100 would be ideal. But they won't just yet come down that fast. But there will be a point ppl start buying back in and prices would go up. 3 yrs sideways.. don't think so. It's already been 2 yrs sideways to slightly down.
The bottom might be near for my place of Chilliwack, in my TH complex of 45 units, 4 units have sold in last 3 to 4 months, from mid 6 to mid 565,000. Were looking to list ours in February and are flexible for what price we get. My aim is to buy a home thats listed at 950k that should be going for 850k. Condos TH, have bottomed- detached has not
How do I find a good realtor? Do I choose someone that predominately sells in my area or someone who has a lot of listings/sales? I need to sell my home as I am relocating and so it is important that it sells quickly and for a fair price and I don't know who will do that for me and what questions to ask.
Where are you located? A few good questions to ask. 1. What is their list vs sale price ratio 2. What percentage of their listing actually sell 3. What is their average days on market 4. How many properties do they sell each year. At the end of the day trust is the most important factor.
I feel Canadian real estate has a ways to fall. Having lived through, and barely survived, the GFC of 2008-10 and Dot Com in 2001-2003, I think this is only just beginning. The lag effect takes years to work its way through and people are just starting to realize how bad the Canadian economy is, in spit of all the rhetoric coming from all levels of government proclaiming how great things are. The top 10% are doing just fine, the other 90% are getting pounded by inflation, insane housing prices and excessive taxes. QSS
i think its great at this point so late in the game sellers are holding their ground over a measly 10k. its showing everyone else what's really going on.
Our amazing realtor once told us if a property gets a lot of interest but no offers, it's 5% overpriced. That's what she's seen consistently in over 2 decades in Metro Vancouver.
I dont know about out west but people are leacing toronto in droves.. they can build all they want.. people dont want to be snywhere near big cities in canada anymore..
I dont see panic selling. I see people offering their houses for sale at a certian price and its not for sale at a lower price. I have 2 houses for sale at a certian price, and not for sale at a lower price because the houses are rented out in screaming hot rental markets and have lots of cash flow.
Finance Minister Chrystia Freeland announced two significant changes to federal mortgage policy Monday, raising the price cap for insured mortgages to $1.5-million, up from $1-million, and expanding eligibility for 30-year mortgage amortizations to all first-time homebuyers
Omg this is priceless.. Steve's face when Tom explain how the buyers are basically walking 😂😂😂😂😂 Welcome to the hot tub. Buyers just got wise. First time since 2008 lol hahah
I have to say, what a sensible approach by Tom to handle the owner's objection and unrealistic expectations. Calm, respectful and logical!! 👏 👏. I think any agent or service provider who gets upset with the clients is not eventually going to win. The owner may list at the sane price you gave them with another realtor if they find you upset or frustrated ( among other things.)
@@SteveKarraschexcept both realtors lose out on the sale and make no money. Considering their time spent they are in fact losing money. So your example isn’t comparable.
My next question regarding the home that the gov't purchased $400,000 over asking would be: "Who owned that house? Was it someone in gov't who profited greatly from the sale?" Now dig deeper and find the answer to that question and you would have a great story.
Owned previously by Toronto community housing, which announced in 2011 has plans to sell 900 properties. Several affordable housing groups got to together and purchased homes to keep the tenants from being displaced. This is a good thing, I just think they overpaid.
Hey Tom and Steve. Great job getting right into the topic. I started to skip your videos because you guys spent hours on introductions and unrelated topics 😅
I've been saying for awhile now variable will dip below fixed in March. 6mo ago i was predicting consecutive cuts well into 2025, people here said i was nuts. and here we are.
My home of 25 years has been upzoned to Transit-Oriented Area 8 floors. Land rights indeed. They offer tax deferment to estate. Welcome to the Soviet Socialist Republic of B.C. ?
Can you guys please talk about the "personalized letter" that buyers sometimes write to sellers ? I personally wouldn't write that, as it feels like begging to me...I mean, I wouldn't beg when I am buying a double-double at Tim Hortons for $ 1.83 (I am a paying customer...why would I beg ?), let alone when I am putting an offer to buy a tiny shoe-size box condo for half a million dollars.
it worked for me way back when I described our family of 3 with a newborn starting out. The seller owned the home for 60 years and raised their kids there...they chose us because of the letter...looking back I should have offered less with the letter lol
Neighbours got one of those letters. Except the "small family trying to find a yard for their child to play in" turned out to be flippers who renoed and resold 6 months later for $300k more. Agent double ended the first deal and sold the flip too.
I agree with Tom of banks propping up the market with this extenddd amortization. 100%
The banks are propping up the market with extended amortizations that is correct but it's not for the reasons you believe. The banks pretty much all have a base case scenario behind the scenes which they don't share with the public that's sees real estate values declining via a slow steady burn. What this does is save the banks while the individuals still get hurt. If all the people on extended ams had to stay within the original amortization over 20 percent of homes would be foreclosed on which would cause prices to drop 50 to 75 percent within 12 to 15 months putting the banks underwater on 70 percent of their book. They will not let that happen instead they are able to get out ahead of it by having to deal 5 percent of these loans this year another 6 percent in 2025 and another 9 percent in 2026. During this time period many will have to sell and many will find solutions to keep their home and some will be foreclosed on. They are preparing for a decline in prices of 20 to 30 percent between now and 2027 and stagnation after that for the rest of the decade. They will shift the issue from their books to the consumer through this exercise by controlling the downfall through a slow burn rather than a crash. The 30 to 30 percent is mostly GTA many areas of the country will only see 10 to 15 percent adjustments and some none at all.
Banks propping up the market due to their own business interests is a free market. If the government forces them, it is not a free market.
It looks like this fall market is turning out to be a fire sale, especially for properties that aren't absolutely perfect. I think next spring will be a really interesting market. Will buyers come back? Or will the market fall again? I think sellers will have come down to today's prices by then, but the question is if the buyers will be there at those prices or not.
fire sale? where exactly is this happening?
The prices of RE have doubled and some have tripled in the last 8 years, which is absolutely insane! The prices they want for their crappy houses should be what we pay for a mansion, it's just ridiculous!
Pop fly analogy is spot-on. Would-be property sellers, take note! Price realistically or UNDER to get a sale now.
no thanks.
no lets it escalate to a huge fire sale lol
@@lak1294 times ticking boys. get in now before prices go up.
It's a buyer's market in the rental market as well!! Got to lower prices on rents as well or make your rentals nicer. Tough times for everyone....is it true that Ravi started to win???
No problem, Karrasch guarantees a 6% ROI on real estate forever. Everyone who doesn’t see this return with him as your agent should sue him.
TH-cam comments guarantee 50% crash every week for all time, starting next week.
Strange. Asking 200k over asking than the market value is not insulting to the buyers. No realtor talks about that. But if the buyers offer 200k less it suddenly becomes insulting to sellers. Every realtor talks about this. 😅
That's a fair statement.
I agree, some Realtors say it's not ethical or like you said insulting. Yet selling your home way over asking with no conditions... completely acceptable lol, honestly buyers shouldn't care if the low ball offer is "insulting", sellers don't like it, don't accept it and move on...
What I think I hear from this episode is that sellers may be finally capitulating.
Please use smaller words.
The problem is many sellers saw the frenzy of prior years and how much homes were selling for. Unfortunately they aren’t accounting for mortgage rates going down to a historic bottom which is likely to never occur in anyone’s lifetime. So you can’t look back as that’s how much your home was worth and should sell for now. People are too stuck thinking of that difference when they should be thinking about the home could be worth even less tomorrow spreading that gap. It’s also crazy to me how greedy people have become scoffing at making over a million on their plain average home when they would have been more than happy making half that when homes were barely appreciating yoy.
People don't want to admit that the market is in a MASSIVE bubble .
And now that bubble is popping.
Average prices need to drop by at least 50%
More like 100%
Wild ppl been in denial for decades
Do you know what’s bubble ?
it's not just real estate, it's how the whole system works. Need to and what will happen aren't the same thing. The government will continue on with the bubble...
@@DummMoney-rr1fi true but until they can’t
This market correction is overdue and because of that its severity will be surprisingly high IMO.
This video was out before the new mortgage provisions...what if anything changes on outlooks from this video?
GM, Happy Sunday.
My mom's semi-detached house in Regina sold in 2 weeks...I guess it was priced right! The market is heating up over there as well. Houses are staying on the market for 45 days+. It seems like people are tired of paying the ridiculously high prices of the large metros.
This is an additional problem we notice in the Abbotsford-Chilliwack area. Prices are no longer differential between closer in to Langley-Surrey and Chilliwack. For example, A two bedroom townhouse in Chilliwack (of a specific quality) is priced close to the price as the same quality of two bedroom townhouse in Abbotsford. Historically there's been a price differential, and a benefit to moving away from Vancouver. And there's always been a price differential between Abbotsford and Chilliwack. Right now the price differential is really small. It's either become more desirable to live in Chilliwack than Abbotsford OR the price reductions are stickier in certain areas.
My neighbours house was listed for 3 weeks they went down 20k and it sold the week after so wierd
Thats how price reductions work!
It was 420k down to 400k so your right around 5 precent reduction.
Still pretty good cuz my house is appraised at 350k but mine is renovated better. So who knows?? 🤷♂️
So wierd cuz a house the next street over sold for 420k just 3 months ago and it was uglier and it didn’t have a park right behind the house either.
I guess it’s if your house is renovated or not cuz the house down the street hasn’t done anything and listed at 320k and been listed for 2 months now. It’s smaller too tho
It seems like renovations can help sell a house faster but may not necessarily increase the selling price by much if at all.
Good day
👋
People don’t really understand who’s Vancouver buyer , except for people wanted a quick profits from before most of Vancouver buyers are people with money and no need to sell for long time so don’t expect Vancouver real estate to be any lower any time soon . Any other parts of Canada is not guaranteed
Listing is up to the roof em
Hey Tom, you gotta remember that community housing would most likely qualify for the CMHC MLI select program where they would get a reduction in rate and up to a 50 year amortization.. so yah they probably overpaid , but their monthly commitment was most likely lower than if it was a regular apartment building.
Good point. Still shocked by the sale price tho!
Good morning! Happy Sunday. Is the bottom near for Canadian real estate or could it get worse from here?
*The back-and-forth that Steve and I had at the end of this episode was not real life conversations with sellers. It was a list of the most common things people bring up as why their home is more valuable then someone else’s*
📉📈📉📈📉📈📉📈
Before the bottom capitulation happens as per free market theory. Then again, real estate is not a free market here. Heavily controlled by gov policies. We may see bottom somewhere around Q4 of 2025 and then stagnation.
When will the price come back ?
It will when the economy booms and there is a growth in onhand income for people. Till them stagnation is the only way. We should study abt Japanese RE market since 1990.
And yes, congratulations Tom & family! 🥳
I feel Canadian real estate has a ways to fall. Having lived through, and barely survived, the GFC of 2008-10 and Dot Com in 2001-2003, I think this is only just beginning. The lag effect takes years to work its way through and people are just starting to realize how bad the Canadian economy is, in spit of all the rhetoric coming from all levels of government proclaiming how great things are. The top 10% are doing just fine, the other 90% are getting pounded by inflation, insane housing prices and excessive taxes.
QSS
@@QuickSilverShelby 100% agree to this.
The bottom in not even close...
Just sit back and watch prices fall off...
My variable is 5.35
Anyone selling now will feel a similar pain of remorse to why they sold; Like those that did in 2009 and 2018.
They’ll likely feel good for the next three years as the market goes down some more and then sideways.
@@sharinglungs3226 inflation will be lower so a rate cut of 50 or 100 would be ideal. But they won't just yet come down that fast. But there will be a point ppl start buying back in and prices would go up. 3 yrs sideways.. don't think so. It's already been 2 yrs sideways to slightly down.
The bottom might be near for my place of Chilliwack, in my TH complex of 45 units, 4 units have sold in last 3 to 4 months, from mid 6 to mid 565,000. Were looking to list ours in February and are flexible for what price we get. My aim is to buy a home thats listed at 950k that should be going for 850k. Condos TH, have bottomed- detached has not
How do I find a good realtor? Do I choose someone that predominately sells in my area or someone who has a lot of listings/sales? I need to sell my home as I am relocating and so it is important that it sells quickly and for a fair price and I don't know who will do that for me and what questions to ask.
Where are you located? A few good questions to ask. 1. What is their list vs sale price ratio 2. What percentage of their listing actually sell 3. What is their average days on market 4. How many properties do they sell each year. At the end of the day trust is the most important factor.
ask your buddy and use who they suggest
How do you find a good mechanic? Word of mouth
@@rylandallas9907 My friend in Surrey said Caileigh Anderson
I feel Canadian real estate has a ways to fall. Having lived through, and barely survived, the GFC of 2008-10 and Dot Com in 2001-2003, I think this is only just beginning. The lag effect takes years to work its way through and people are just starting to realize how bad the Canadian economy is, in spit of all the rhetoric coming from all levels of government proclaiming how great things are. The top 10% are doing just fine, the other 90% are getting pounded by inflation, insane housing prices and excessive taxes.
QSS
i think its great at this point so late in the game sellers are holding their ground over a measly 10k. its showing everyone else what's really going on.
lol, 1% of value or less
@@DummMoney-rr1fi Over that amount of money, i don't think its the money, i figure they are trying to prove a point.
Our amazing realtor once told us if a property gets a lot of interest but no offers, it's 5% overpriced. That's what she's seen consistently in over 2 decades in Metro Vancouver.
Good advice.
I dont know about out west but people are leacing toronto in droves.. they can build all they want.. people dont want to be snywhere near big cities in canada anymore..
Great show guys!!
I dont see panic selling. I see people offering their houses for sale at a certian price and its not for sale at a lower price.
I have 2 houses for sale at a certian price, and not for sale at a lower price because the houses are rented out in screaming hot rental markets and have lots of cash flow.
Wait for next year 😂
Why are you selling?
Great show guys ❤
Finance Minister Chrystia Freeland announced two significant changes to federal mortgage policy Monday, raising the price cap for insured mortgages to $1.5-million, up from $1-million, and expanding eligibility for 30-year mortgage amortizations to all first-time homebuyers
Omg this is priceless..
Steve's face when Tom explain how the buyers are basically walking 😂😂😂😂😂
Welcome to the hot tub. Buyers just got wise.
First time since 2008 lol hahah
Steve's face at the best of times....
dont pee in the tub!
Sunday Funday!
not if you are a listing agent
I have to say, what a sensible approach by Tom to handle the owner's objection and unrealistic expectations. Calm, respectful and logical!! 👏 👏. I think any agent or service provider who gets upset with the clients is not eventually going to win. The owner may list at the sane price you gave them with another realtor if they find you upset or frustrated ( among other things.)
Skate to where the puck is going, which is UNDER.
im trying to get a condo right now 20% underlisting price equivlent to 2019 pricees i have been putting bids for 4 weeks all rejected
Most sellers can hold longer than the buyers think. But is it smart to hold?
@@SteveKarrasch i only bid on ones that have been on the market for 45 days plus too i dont think its smart to hold. specially with rents dropping
@@hashoes3294 you sound like an options trader...good luck, ask Bell Firguson how it's worked out for him waiting....
Yes people should have defaulted! And this would have put downward pressure on housing
Nah i saw this coming in August. House sold August 30th ✌️
Lol these comments. All the doomsdayers are only watching part of the video as usual 😂
Tom, If you were only $10K apart, on a deal why did'nt each Realtor throw in $5K to get it done? Seems like a no brainer
Since the economy is hurting, why don't employees just work for free and help get those big company profits back to where they should be?
@@SteveKarraschexcept both realtors lose out on the sale and make no money. Considering their time spent they are in fact losing money. So your example isn’t comparable.
@sharinglungs3226 conditions and closing were factors. It wasn’t just price.
"Ex-procreation" That made me laugh.
Anything over two syllables is a likely pronounced wrong on this show.
My next question regarding the home that the gov't purchased $400,000 over asking would be: "Who owned that house? Was it someone in gov't who profited greatly from the sale?" Now dig deeper and find the answer to that question and you would have a great story.
Owned previously by Toronto community housing, which announced in 2011 has plans to sell 900 properties. Several affordable housing groups got to together and purchased homes to keep the tenants from being displaced. This is a good thing, I just think they overpaid.
Hey Tom and Steve.
Great job getting right into the topic. I started to skip your videos because you guys spent hours on introductions and unrelated topics 😅
Missing the good part! Welcome back.
Welcome to podcasting!
I've been saying for awhile now variable will dip below fixed in March. 6mo ago i was predicting consecutive cuts well into 2025, people here said i was nuts. and here we are.
I agreed with your prediction the whole time. I'm saying rate will be 2.5-3% range by July next year
The crash is starting 😢
It always is.
ppl are gonna catch that pop fly with their teeth if they get in right now
My home of 25 years has been upzoned to Transit-Oriented Area 8 floors. Land rights indeed. They offer tax deferment to estate. Welcome to the Soviet Socialist Republic of B.C. ?
As a girl men with small hand is turn off
Mustache 😮
buy when on one will buy, sell when everyone is buying my $0.02
Common sense that no one actually follows.
You new found real estate gurus lol.
Capitulation
Look it up
Time to buy
as warren buffett says
more political talk,cheers
See you next week!
Can you guys please talk about the "personalized letter" that buyers sometimes write to sellers ? I personally wouldn't write that, as it feels like begging to me...I mean, I wouldn't beg when I am buying a double-double at Tim Hortons for $ 1.83 (I am a paying customer...why would I beg ?), let alone when I am putting an offer to buy a tiny shoe-size box condo for half a million dollars.
it worked for me way back when I described our family of 3 with a newborn starting out. The seller owned the home for 60 years and raised their kids there...they chose us because of the letter...looking back I should have offered less with the letter lol
Double Double = Housing
Neighbours got one of those letters. Except the "small family trying to find a yard for their child to play in" turned out to be flippers who renoed and resold 6 months later for $300k more. Agent double ended the first deal and sold the flip too.