Buying vs. renting in Canada's home market: housing panel
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- เผยแพร่เมื่อ 5 ก.ย. 2024
- Ron Butler, mortgage broker at Butler Mortgage, Bob Dugan, chief economist at Canada Mortgage and Housing Corporation, Lauren Haw, broker of record and industry relations officer at Zoocasa, join BNN Bloomberg to discuss real estate.
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in my opinion, housing market crash is imminent due to the high number of individuals who purchased homes above the asking price despite the low interest rates. These buyers find themselves in precarious situations as housing prices decline, leaving them without any equity. If they become unable to afford their homes, foreclosure becomes a likely outcome. Even attempting to sell would not yield any profits. This scenario is expected to impact a significant number of people, particularly in light of the anticipated surge in layoffs and the rapid increase in the cost of living
I suggest you offset your real estate and get into stocks, A recession as bad it can be, provides good buying opportunities in the markets if you're careful and it can also create volatility giving great short time buy and sell opportunities too. This is not financial advise but get buying, cash isn't king at all in this time.
Accurate asset allocation is crucial. Some use hedging or defensive assets in their portfolio for market downturns. Seeking financial advice is vital. This approach has kept me financially secure for over five years, with a return on investment of nearly $1 million.
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Not a word on the 1.4 million newcomers a year… empty talk…
Most of them are temporary, and the Federal government has expressed an intention of kicking them out once their visas expire. They were exploited by Canada's education system and corporate low-wage employers, and most won't be getting the golden PR ticket they were promised.
The CHMC guy is a total propagandist trying to lie that the housing market isn't gonna collapse. Shout out to Ron Butler for being the only qualified panelist and telling it how it is.
As expected. The CMHC is a failed institution of Canada and should be shut down. Their mandate is to "improve access to housing", and they've done the complete opposite for the past 20 years +. Why BNN thought they'd get anything resembling an unbiased opinion out of this clown is laughable.
Keep dreaming and hoping that it will collapse and you will never own anything. Been hearing this since the 80s and all those saying that are priced out and renting for life
@@Alanom2007 You've been hearing it since the 80s because global interest rates had been falling for 30 years. That's now over, and the fantasy land you're living in that land prices can appreciate in perpetuity above the rate of inflation and wage growth is coming to an end. Don't try to claim that nobody warned you when the house of cards fully collapses.
Everyone loses if there is a collapse. Renters and owners. Only the rich rich make it out unscathed. A collapse may seem imminent but the federal government keeps preventing it with monetary motions. If anything housing is going to increase until it stabilizes, followed by a correction and then followed by the standard appreciation adjusted for inflation.
Ron keeping it real and acknowledging the next generation 💯
For newbies, be aware that this is a grossly oversimplified scenario. For one thing, you can't get a mortgage on an investment property without at least 25% down payment. Two, it's easy to see comps for house purchase prices, but it takes a lot of research to understand the comps on rent prices. The trick is to find a place where renting is more expensive than buying, but those places are less common because of this very type of scenario. Three, you have to remember that rent number he's using is supposed to be net income, not gross. So you have to think about costs for taxes, insurance, maintenance and vacancy when you're researching investments. All that said, real estate investing is a good tool for wealth accumulation. But it isn't foolproof.
Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes.If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.
It's often true that people underestimate the importance of financial advisors until they feel the negative effects of emotional decision-making. I remember a few summers ago, after a tough divorce, when I needed a boost for my struggling business. I researched and found a licensed advisor who diligently helped grow my reserves despite inflation. Consequently, my reserves increased from $275k to around $750k.
Recently, I have been exploring the possibility of consulting with advisors. As a mature individual, I am in need of guidance, but I am curious to know how truly impactful their services can be?
There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’ Melissa Terri Swayne” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.
I looked up her name online and found her page. I emailed and made an appointment to talk with her. Thanks for the tip
1:00 I know it's well meaning to tell people to "sock away the savings", but in Vancouver where the average rent is beyond the average income, this is unrealistic.
They said the same thing about Vancouver 12 years ago. Look up old TH-cam videos on owning Vancouver property
@@robocop581the bar just keeps getting raised. It would have applied to middle and lower income 12 years ago. Now you’re pricing out even those in the upper middle class. You basically need to be a top 5% income earner and that’s simply unsustainable.
Thank you Ron, the "FLAW is in the pricing"
It should live in Canada vs. leaving Canada forever in this crazy unaffordable environment
Don't plan on moving to a 'proper' country like Australia or England etc.
@@Roof_Pizza Exactly, they all printed money and now the pain being felt is the payback for all that printing devaluing currency and cheap debt. All while making assets that cannot be printed more expensive as it takes more of that printed funny money to buy them.
“Great creator of wealth”…what happens if the wealth divide reaches a terminal divide and immigration slows to a trickle or employment options disappear? Governments must monetize increasingly burdensome debt levels to function and will not entertain sustained deflation in asset prices.
So if you are an emotional buyer that wants to be under water heading into uncertain times - buy.
The people who can make these payments are leaving because TO sucks!
If you can afford your forever home, the answer is obvious. I rented for 7 years and saved as much as i could as i knew I only have one shot at buying, as the first lady says, the transactions costs of moving are going to eat your equity. Over a period of 30 years, in a good location you are virtually guaranteed that a house will appreciate at least close to the interest costs, likely more. Which means, you end up with equity and your real costs will be maintenance and taxes which will always be less than rent.
There’s a lot of factors people don’t calculate such as how much interest they’ve paid over time and the devaluation of the currency. For the most part owning a home lets you live for free but not necessarily that you made any money from it. The real issue is many people are awful investors and while renting they won’t have time or interest to invest so as renters they fall behind home owners. If you have any interest in investing and are half decent at it you can do a money hack and let your portfolio pay for your living expenses and eventually you’ll have enough where you don’t need a mortgage and home ownership is more of an option.
Another problem is that corporations are buying single family homes and renting them out. How can any couple or small family compete with their huge capital? We can bid on 100 houses and get beat out each time by a huge company. To bid on a house then see it for rent the following month is awful. Furthermore that rent price is higher than we we would be spending on a mortgage. Corporations should not be allowed to buy up single family homes.
The CMHC has been part of the problem.
The land is The Queen's land. Wake up!!!
A house in Toronto has not been 3X an average income anytime in memory. I bought at the very low in the 90's and I had a good job and the house cost 6 times my gross income. Luckily we had two incomes. sure, it's more now, but why is everybody lying to prove that it was easy for us? It wasn't, and as I said , I was lucky to buy in a time of long economic recession, because I still had a job, but nobody should wish for such times again.
You can also argue it was a lot cheaper to rent back then but you took the risk in buying a primary residence
Facts and data exist. I don’t know what your income is but it sounds like you fall on the lower end of the income range. My parents bought a new house for $350k in the 90’s which was the historic low as the market crashed. At the time it was less than 4x their combined income. Inflation adjusted it should be $662k but that same house would be $1.8m today. These times are not the same.
Renting is definitely way to go especially when the Landlord and Tennant board has a policy in place to encourage tenants not to move out, l am not kidding, take a look at the Notice to end the tenancy, N11 and N12, it specifically states that tenants don’t have to sign. So basically the tenants become the owner of someone else house. This is how the government fixes the housing issue by allowing people to occupy the owner’s property against their wishes. The same way the government is raising the capital gain to bring revenue to the government. Living in a new area where instead of the government solves people’s problem, people are expected to solve the government’s problem. Not sure what this system is called😮
Canadian housing market is getting worse. so crazy.
Homeownership does not create actual wealth because it's a money pit. Buying assets that put money in your pocket creates wealth.
😂
Lemme guess, you are not a homeowner 😂
@@cyonix5941
I bought a rental for $331,900 its worth $400,000 now but Grizzle calls it a moneypit
I have a home, and I don't feel wealthy at all. I fix one thing and another breaks.
Most people don’t actually calculate how much their home actually cost. I always find it hilarious when someone says they paid x dollars for the house and it’s worth x dollars now and think a simple subtraction is how much money they’ve made.
Mass Immigration is making the problem worse. Young Canadians will not have children because the policymakers are destroying the quality of life. The solution from the people profiting from the crisis they've created is never to cut immunization.
Renting is the biggest waste of money
Only wasteful if you don’t know how to use it to your advantage.
Hit 200k today. I'm really grateful for all the knowledge and nuggets you had thrown my way over the last months. Started with 14k in February
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+166
It's not an "investment" if you live in it. Also, though capital appreciation in recent history has been high, the valuations are reaching an upper bound. Once immigration flows reverse, housing is going to go back to what it was in the 1980s, a boring, relatively cheap asset that was an endless money pit of repairs, fees, and taxes. The Canadian housing bubble is popping, and people would do well to be more cautious than normal.
It is an investment that leverages on the necessities of a human. Therefore it’s a great appreciating investment
@@cyonix5941 Actually sometimes housing is a depreciating asset. It's only the last couple decades that buy and hold real estate investing was profitable, but it's not sustainable.
So what do you call paying rent, an investment?
@@robocop581 passive income
@@robocop581 It's an expense, just like all the costs of ownership is an expense.
Lies.
Leave Canada
Ron thinks emergency planners are useless and saw this coming a whole 24 hours ago lmao
Why is he here