house prices, rate increases, new build costs, resale homes

[angrymime666]

so Ive been pondering things regarding the possible price drop for the housing market and I would like to hear other opinions.

1) as interest rates rise buyer loose the ability to purchase homes due to carrying costs of the mortgage( I dont see the BOC going to much further).

2) inventory is building and the market is stagnant

3) the cost to build new houses have increased due to material shortage, increased labour and material costs

4) population continues to increase

5) land in popular area is limited

6) more than likely people will hold onto their current home unless they really need to sell

7) please add any other contributing factors you may think apply


so given the above how could house prices drop significantly(lets not go the radical route of insane interest rate like in the 80s)?

if it costs x per square foot to build a home. wouldnt it make sense that the lowest price for a home would equate the actual cost to build a home?

 

[Goodoer]

The housing market is coming off of insanity level with speculative increases being stripped from the housing prices. It will settle down to where it is supposed to be. This will still be high prices as housing is limited. Your house is an inflation hedge.

The Government needs Developers to build. Developers will flex their might soon to get favourable conditions to maximize their profits. The hope is that we refocus on density as opposed to sprawling out with single-family dwellings. SFDs are much faster to build.

 

[CLOUD 500]

House prices will probably never go down especially in Toronto due to mass immigration which is the singular cause of housing price increases. Densification is ludicrous. Do we want to live in a city like Honk Kong where all you see are 60 story condo towers everywhere, no green space, mass traffic, crowds of people everywhere? The government is trying to destroy the traditional way of life where people owned a single detached house. Ask yourself this, do you want to live in a cramped condo or would you rather have your own house with lots of space and a backyard? Do you want to take the bus everywhere or would you rather drive and not be stuck in traffic.

 

[Goodoer]

House prices will probably never go down especially in Toronto due to mass immigration which is the singular cause of housing price increases. Densification is ludicrous. Do we want to live in a city like Honk Kong where all you see are 60 story condo towers everywhere, no green space, mass traffic, crowds of people everywhere? The government is trying to destroy the traditional way of life where people owned a single detached house. Ask yourself this, do you want to live in a cramped condo or would you rather have your own house with lots of space and a backyard? Do you want to take the bus everywhere or would you rather drive and not be stuck in traffic.

The answer is to plan better. Condos must be 3-Bedrooms. Green space must be provided, etc.

Encourage development in other cities to take the pressure off of Toronto. Provide fast rail service between each city.

If we want to stick with SFD, the houses must be scaled down, properties smaller, houses taller (3-4 storeys).

There is a way. What is happening now is insane.

 

[Ceiling Cat]

There is a huge unknown factor, how will world economies do after the pandemic, record government stimulus, and Ukraine war. Stimulus may have to be re-introduced as needed, we are not over the pandemic yet, and the Ukraine war is not over. I know a person that was selling a house and he had all the deeds since the house was built. From 1900 - 1929 the prices rose from $3,000 to $15,000. After 1929 the price started to slip for ten years.

Are we in for a depression, this is unknown at this time. I suspect we will have many recessions where the economy retracts for several months. I believe we will have ten years of slow growth. Incomes will be reduced or become stagnant, tax revenues will shrink, prices and profits will be reduced for lack of buyers.

As interest rates rise there will be more sellers. With inventories building up sellers will sell for less. When there is less construction builders will build for less and materials will sell for less. The population will most likely increase by immigration, during hard times there will be less educated people immigrating to Canada.

I was not around during the Great Depression, but I can remember as a kid seeing streets with every second house for sale in the early 80s. There are similarities of conditions today and the early 1980s recession. Inflation and the sharp rise in oil prices.

Early 1980s recession - Wikipedia

en.wikipedia.org

 

[Goodoer]

Is the Canadian Government (like most) a bunch of retarded turds? Absolutely yes!

The people with money will not let their system fall. Things will shake out a bit, but we'll not have doom & gloom.

Builders will not build for less. A new normal has been established. Union workers got their raises fixed for the next 3 years.

 

[Goodoer]

If you have a mortgage based on yesteryear, the amount owed is becoming trivial. (e.g. $200K is 'nothing' nowadays).

A fucking Ford pick-up truck is $100K now.

 

[CLOUD 500]

The answer is to plan better. Condos must be 3-Bedrooms. Green space must be provided, etc.

Encourage development in other cities to take the pressure off of Toronto. Provide fast rail service between each city.

If we want to stick with SFD, the houses must be scaled down, properties smaller, houses taller (3-4 storeys).

There is a way. What is happening now is insane.

The problem is the immigrants like to go to the big cities. How to get them to settle in the northern sparsely populated areas where the population is needed? Places like Timmins, Thunder Bay, Sudbury, etc.. As a whole Canada is sparsely populated but Toronto is over populated so it needs to be spread out over this vast area. What you propose is densification which seems to be the goal of the Liberals. I seen a lot of the new houses built in the GTA, all small cheaply built, all look the same with small backyards. I do agree with better planning but I do not think that is their interest, many politicians got shares and stakes in real estate and real estate companies I suspect are lobbying the government. They purposely are increasing the population without any proper management to ensure there is enough resources to ensure everyones quality of life remains good, the politicians and real estate companies are making a lot of money off this rapid population increase.

 

[curr3n_c1000]

I seen a lot of the new houses built in the GTA, all small cheaply built, all look the same with small backyards.

This is so true.

Those old house in Toronto were built rock solid and with fine craftsmanship.

The homes today, everything feels cheap. The walls are thin, doors put on crooked, shitty paint jobs, scrap wood being used, the bricks feel cheap.

The GTA has become a cruel joke.

 

[Goodoer]

This is so true.

Those old house in Toronto were built rock solid and with fine craftsmanship.

The homes today, everything feels cheap. The walls are thin, doors put on crooked, shitty paint jobs, scrap wood being used, the bricks feel cheap.

The GTA has become a cruel joke.

I'd have to disagree with you. The houses are built better now than they ever were. Better materials everywhere with building science. They are actually built to a building code.

What you're referring to are cosmetic items or finishing which are easily replaced or provided. You can pay for all that stuff separately if you wish. Bricks used are fine, but I too wish they'd let you upgrade to a through-body brick... Costs would get much higher.

 

[curr3n_c1000]

I'd have to disagree with you. The houses are built better now than they ever were. Better materials everywhere with building science. They are actually built to a building code.

What you're referring to are cosmetic items or finishing which are easily replaced or provided. You can pay for all that stuff separately if you wish. Bricks used are fine, but I too wish they'd let you upgrade to a through-body brick... Costs would get much higher.

So you would buy a Newly built house just to replace and repair shotty work?

I don't want to be banned again for arguing, so we will have to agree to disagree.

 

[Samranchoi]

“house prices, rate increases, new build costs, resale homes”

In my profession, I deal with these things every day. The panic, pain, confusion, uncertainty, fear, etc.... that individuals are going through is very real. Much of it is timing and some being given bad advice from many real estate and mortgage professionals (there are so many people who wish they could turn back the clock to earlier this year and instead of taking a variable rate mortgage, now wish they took the sub 2% 5 year mortgage that was offered to them).

We have seen a major shift in values, so much so, that the financial regulatory body has started cautioning those in the mortgage industry that more tightening is coming on an existing “tight” set of guidelines. This may force many to seek “alternative” more expensive options (fees and rates) as they see their affordability decreasing even further.

There are still many real estate investors who are making a lot of money and they see what is going on as a bump in the road but in the end they will survive. But those who were in a vulnerable position when they got into the market or stretched themselves too thin during the hype, are now in some trouble and don’t have the necessary time or resources to wait for when things get better.

 

[Ceiling Cat]

There are still many real estate investors who are making a lot of money and they see what is going on as a bump in the road but in the end they will survive. But those who were in a vulnerable position when they got into the market or stretched themselves too thin during the hype, are now in some trouble and don’t have the necessary time or resources to wait for when things get better.

Any real estate investor that is still making money is doing so in a slowing market. I suspect the worse is yet to come. Will it be hard times or many times when the economy is set back. This is the big unknown at this time. The wild card is Putin when he puts the deep freeze on Europe this winter. The extra fear will not help. Then there are those that are at the edge or near the edge of their financial abilities. As they go over the edge and bank foreclosures increase, people will sell for less. Just as people bought in the past because they believed that if they did not do so as soon as possible the prices will be out of reach for them, in a tough economy they will sell for less because they believe if they do not unload now prices might plummet. That is not even taking into account the people that must sell because of diminished financial abilities.

 

[angrymime666]

I agree that different type of residential housing is needed(allowing multiple units in a home); however, the cost associated with building new are much more costly per square foot compare to buying resale. builders have to eat, so do their employees, and cost of materials (I dont see declining in price).

the market is stagnant, and I see properties moving at a very slow pace compared to previous months. I dont know the final sale price of homes so I can only speculate about the drop in my area.

if they do start building which government has promised it wont be for years, and by that time inflation and interest rates should be back to normalish.

I think people will hold on to what they got and wont accept a lower sale price unless they need to sell. that need some people have will be profited from by other people.

just saw a 100k 1 bedroom house in my area.

 

[CLOUD 500]

As long as the Gov't of Canada keeps to bring in 400k new comers every year, the housing price won't drop for the long run. This is a supply & demand relationship.

Exactly what I have been saying for a long time. This is the most singular cause of the housing crisis. We got a clown as prime minister, he wants to increase the population of Toronto to 18 million people, with that much you end up like NYC with $3000 rents and everyone living in small little condos. Also do not forget about refugees, thousands cross daily from Roxham Rd and I read somewhere that a bunch of them were sent to Toronto. The take a bunch of apartments and dedicate them as social housing (reducing the supply of multi-unit apartment units) and the social housing always goes first to refugees. Since the total amount of apartment available to the general public went down and population increases, rents go sky high.

 

[curr3n_c1000]

There are few jobs outside of the major cities. Even if you immigrate to a small town, you'll eventually move.

They way I see it, house prices are not going up, we are just getting poorer.

 

[CLOUD 500]

One of the reasons is the language barrier.

That is a good point.

 

[CLOUD 500]

There are few jobs outside of the major cities. Even if you immigrate to a small town, you'll eventually move.

They way I see it, house prices are not going up, we are just getting poorer.

Yes due to government spending too much like social benefits packages, covid packages, sending money to foreign countries, giving free hotels and monthly paychecks to refugees. You described inflation, the most hideous form of tax.

 

[NiceToMeetYou]

As far as I can see, quality of life for people in traditionally economic power house Western countries have been nose diving for the past five or so decades starting from 1970s. At the same time, quality of life of people in developing countries mainly in Asia particularly in East Asia, Southeast Asia and Asia Pacific have continued improving since 1970s.

Basically, American, Canadian and Western Europeans pies have been shared, sliced and eaten more and more by people in developing countries in Asia. Unfortunately, African nations have been unable to take more slices from the American, Canadian and Western Europeans pies.

Asking me the reasons of the pies have been eating elsewhere and more in Asian countries, there are many reasons that I'm tired to type all them out. I'm sure most of us can figure out the reasons on your owns.

Affordable housing comparing to take home incomes is also another indicator of less and less people in America, Canada and Western Europe can eat the same global pies.

World continues to change whether we like it or not.

Best thing for you to do is to eat less pie than you used to eat in the past. Then you will continue to be happy in your life until your final moment and breathing in this world.

Time of life of everyone is limited and rather short for most at 80 years or less. So why we still continue to moan and complain about the changes have been taking place in this world.

So be HAPPY and continue to CUM more and more in your limited time left in this world. That is the true meaning of HAPPY ENDING.

 

[Varoufakis]

As far as I can see, quality of life for people in traditionally economic power house Western countries have been nose driving for the past five or so decades starting from 1970s. At the same time, quality of life of people in developing countries mainly in Asia particularly in East Asia, Southeast Asia and Asia Pacific have continued improving since 1970s.

Basically, American, Canadian and Western Europeans pies have been shared, sliced and eaten more and more by people in developing countries in Asia. Unfortunately, African nations have been unable to take more slices from the American, Canadian and Western Europeans pies.

Asking me the reasons of the pies have been eating elsewhere and more in Asian countries, there are many reasons that I'm tired to type all them out. I'm sure most of us can figure out the reasons on your owns.

Affordable housing comparing to take home incomes is also another indicator of less and less people in America, Canada and Western Europe can eat the same global pies.

World continues to change whether we like it or not.

Best thing for you to do is to eat less pie than you used to eat in the past. Then you will continue to be happy in your life until your final moment and breathing in this world.

Time of life of everyone is limited and rather short for most at 80 years or less. So why we still continue to moan and complain about the changes have been taking place in this world.

So be HAPPY and continue to CUM more and more in your limited time left in this world. That is the true meaning of HAPPY ENDING.

can I get some of that pie you are smoking? I need a happy ending...