real estate..... is it true??
- Thread starter parisbeautiful222
- Start date
I think Toronto will continue to be a another safe haven for foreign cash in the RE market. Especially if the nation's response to Covid-19 continues to be as good as it is. People are going to continue to want a safe haven for their cash and a safe get away spot.
Yes sir. It like the twilight zone they tell you how dangerous it is, they tell you to stay home yet their being reactive instead of proactive. It’s been a complete joke. They’ve had months to prepare for this.
If the numbers hold as they are Canada is low on the death rate. Look at the USA, Italy, China and the Netherlands as examples.
That could change mind. But at this point that and the govt response about wage assistance to business and four months cash out could be the difference in no foreclosures.
Which means no low priced stick availability. Add in the Canadian banks are probably going to play ball on helping mortgage holders and the dip may be very low.
In a pandemic with international travel and the freedoms we normally have it's going to be impossible to contain anyway. Too many idiots who don't care.
The problem is globalization and reliance on the China/Third world chain for goods, especially essential ones.
lets see how investment properties hold up over the next 3-6 months. Even if people get back to work, they may not lift travel restrictions. People may hold off on travel. There are thousands of investment properties relying on Airbnb revenues, not to mentions renters are all gonna have trouble and landlords will have to make concesssions and try to make up for it in lower interest rates. Not everyone will get hired back right away. it will be messy indeed. No one wants to see a crash but there might well be some air let out of this bubble by the time its all over. A 10-15% haircut on prices is enough for 50 to 100% of ones investment(equity) to disappear. A 20% decline in prices will be very damaging to investor balance sheets.
Not the way a business cycle typically ends. There is no real shortage of capital, no inflation, no shortage of energy. We are now headed into deflation. Rates will remain near zero. When business can resume, it will IMHO. But it will take awhile to get back to similar levels.
Real estate is too big to fail
https://www.huffingtonpost.ca/entry...f7PuUAYUX4l2eZ9lHcfVbRv_rZ-FD9KN-3ReQZcgHyz_M
https://www.huffingtonpost.ca/entry...f7PuUAYUX4l2eZ9lHcfVbRv_rZ-FD9KN-3ReQZcgHyz_M
If inflation hits with all the money being flooded into the system then interest rates could rise.
That could become a factor in this.
That could become a factor in this.
The government believes that at this time 25% of businesses are in big trouble having to shut down, and 33% of people that are not working have no savings. As the shut down stretches out more businesses are getting into trouble, and more people are getting deeper in debt. This shut down of society will continue at least till May before be start to return to normal, it may even be a month or two longer than that. How much savings will have been eaten away even if the shut down is short. It will take years for us to get back to a point where we were two months ago. How many people will not buy their first home or buy it many years later than they planned to. This covid-19 crisis has diminished the ability of people to buy and diminished the value of housing.
omg this article was amazing, thank you smallcock!
PRIVATE LENDING! I can't wait to be able to dabble in that in the future. Can you imagine - purchasing mortgages!? Aha!
Insiders at all the major banks are already writing off a minimum of 20% value on real estate across Canada. Interestingly the numbers they project are worse for Toronto as there seems to be the least amount of traditional savings built up in this major metropolitan area. Small business owners are being completely wiped out and left negotiating with commercial landlords for 30cents on the dollar.... if they don't just walk away and face future law suits.
Toronto is facing at least 30% drops in market values sustaining for up to 2-5 years. That should provide a healthier balance of buyers and sellers in the long term.
I agree with most optimists that our real estate here in the "6" will be fine. It will just be very much deflated for a just few years. It's unfortunate for those who have purchased homes in the last 5-10 years. Their equity will be wiped away.
Toronto is facing at least 30% drops in market values sustaining for up to 2-5 years. That should provide a healthier balance of buyers and sellers in the long term.
I agree with most optimists that our real estate here in the "6" will be fine. It will just be very much deflated for a just few years. It's unfortunate for those who have purchased homes in the last 5-10 years. Their equity will be wiped away.
If real estate values drop by 30%, that would only wipe out equity built up for the past 2 or 3 years.
That's true in some parts. There's a wide range, and yet how quickly are most to spend their equity, on another property, or on a toy, or a car, or a vacation? No one wants to see finances fall apart, but whether you are extended on the stock market or with your real estate it never ends well in a crisis. And with all the studies of how Canadians would fair missing a monthly paycheque, we'll now see how that works over 3-6 months of greatly reduced income in a massive percentage of households.
I don't think the conditions are ripe for structural inflation across the economy. Interest rates, ehhh. There's nowhere out there for people with money to earn a high return. That's generally how interest rates go up in mature economies.
