What's a millennial to do in this housing market? - Page 6
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Thread: What's a millennial to do in this housing market?

  1. #51
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    Can see a fall in the next year or so. If inflation picks up or maintains its rate then the BoC has no choice but to raise rates to tackle the increase in inflation.


  2. #52
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    Forgot to add something.

    Quote Originally Posted by stryder1587 View Post
    For the financial sector, the crash of 09 was pretty devastating but Canadian banks were the most resilient in bouncing back due to our conservative risk policies. Does it look like our financial sector is due for some cyclical recession again?
    Actually, our banks were effectively bailed out by the CMHC: http://www.macleans.ca/economy/busin...-bank-bailout/

    Also, a lot of people are borrowing from private lenders. In fact, homeowners were being pitched to become second lien lenders at the Real Estate Wealth Expo.
    https://onbeyondinvesting.com/blogs/...-didnt-have-to

    I don't believe our banks will be in much trouble even in the advent of a crash, due to the taxpayers sharing the risk. However, the risk exposure of our entire financial ecosystem may be severely underestimated.
    Last edited by rebel_ins; 2017-03-20 at 08:39 PM.

  3. #53
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    Found this on another forum, and it's too crazy to not share. An article from 1988 about bubbling housing in Toronto:

    https://www.scribd.com/doc/314505251...liate&irgwc=1#


    Some excerpts:

    Absolutely everyone from cab drivers to chief executives has a story about Toronto’s crazy housing market. Politicians and tenants’ groups have declared a housing ‘affordability crisis’ – again – and have called for a tax on speculators’ profits to cool down the frenzy. Dark words are muttered about how foreign money is to blame.
    In fact, the price explosion has occurred for simpler reasons. Mortgage rates are low… Residents of this huge, rich, expensive urban conglomeration have taken somewhat hopefully to calling their city ‘world class.’ But the price of being world class is ‘Manhattanization.’ Torontonians are getting a taste of the housing problems of the world’s major cities.
    Owning a house is now the investment of choice for most of the middle class. Because inflation has outpaced wage gains for most of the decade, salary earners feel they can gain ground only by possessing property. The equity in a house provides – tax free – a major portion of most people’s retirement nest egg. To cope with the high costs, it’s become standard practice for house-poor owners to build and rent out a self-contained apartment.
    For many Torontonians, the North American dream of home ownership has already faded, and they’ve joined the ranks of renters, probably for good.[/B] Those intent on owning will find themselves forced to think small.

    Seems like deja vu...

    But the biggest x-factor in all this that makes it even worse:




    Obviously there are differences between now and almost 30 years ago, different economy, etc... but still interesting to see the similarities.
    Last edited by DollaWine; 2017-03-23 at 04:58 PM.

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  5. #54
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    Found this article for a different forum debate...

    http://www.huffingtonpost.ca/2016/03...n_9489000.html
    I'm not JustAGuy (without spaces), or Donald, or <insert name here>.

  6. #55
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    Cool article JAG.
    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

  7. #56
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    But leave us not forget, we are warned daily that all of Canada is in a housing "bubble". One day soon it will blow and those houses featured in the article cited by JAG will be available for purchase at the price of a coffee at Starbucks.

  8. #57
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    Real estate is not a fixed price market, unlike stocks. Even in a bubble you can find deals in real estate. They may not be common, but they are there if you look. I've been picking up places 40-60% below market over the past few years.

    If you buy with the correction built in, your downside risk is significantly reduced. If you get into a bidding war, well people in a war generally don't come out unharmed.

  9. #58
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    Quote Originally Posted by rebel_ins View Post
    Forgot to add something.



    Actually, our banks were effectively bailed out by the CMHC: http://www.macleans.ca/economy/busin...-bank-bailout/

    Also, a lot of people are borrowing from private lenders. In fact, homeowners were being pitched to become second lien lenders at the Real Estate Wealth Expo.
    https://onbeyondinvesting.com/blogs/...-didnt-have-to

    I don't believe our banks will be in much trouble even in the advent of a crash, due to the taxpayers sharing the risk. However, the risk exposure of our entire financial ecosystem may be severely underestimated.
    My friend purchased a detached home in Brampton 3 months ago for 740k. Initially the idea was to put 10% down. But he did not have enough cash so he put 50k down and mortgage was not approved for 690k. Then realtor got his mortgage approved and realtor charged 2% of the mortgage amount as commission. He is married and has two kids. He makes about 85k. He wife is not working currently but on his mortgage application they put income for his wife to get the approval.

    Yesterday I came to know that couple other friends purchased home in Brampton for 820k from the same broker. Their spouses don't work so you can imagine how they got approved for mortgage..

    My friends idea is sell in couple of years make 200k . so far people like him are in driving set. People are making free money..
    I am not sure how wide spread the problem is but I am sure gov't know this and they just don't want to stop the party.. I think foreign buyer tax will be removed in Vancouver after elections..

    If there is slow down Canada can bring wealthy immigrants to improve the situation. For GTA, one side you have lake other side too cold so city expansion is only possible east and west.. so I don't think there will be crash. Look Calgary even after two years of slowdown there is no crash.. prices are not down much...

  10. #59
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    get an advance on your inheritance.

  11. #60
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    Mortgage for $690k and making $85K...did I read that correctly?

    That is nuts. #forevermortgage

    I keep saying this but I would love to see *interest rates go up. That would be great and start putting an end to this madness. It would reward savers too, finally.

    *It won't happen. BoC doesn't care.

    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

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