Canada's 'housing bubble' deemed close to bursting

[SignalHillHiker]

I had no idea. Spent the night installing a new fake backsplash (the painted one was killing me). These gel stickers look fine!



They even shine:

• Video Link

If you’re fixing up a place, highly recommend.

[Wigs]

nice job, SHH

always appreciate you showing us your home improvements.

[Hali87]

Originally Posted by Wigs

That is wild.

No doubt in part because people like my cousin and his family of 4 keep moving from southern Ontario to Nova Scotia

How soon will Halifax residents go from "All of this growth is great!"
to "Omg it's getting so expensive we might have to move" ?

I mean, as a city we've already hit that tipping point.

There are plenty of neat-to-photograph things coming along with the growth, but in practice most of the people I know under 40 who have lived here for over 5 years are worse off than they were 5 years ago, because much more of their income is going towards rent now. Very few of them own property. It's truly a crisis here.

You accompany your statements about Southern Ontarians driving up the housing prices here with grinning emojis but to be honest there's a very stark awareness locally that this is exactly what's happening and unfortunately I don't think it will be long before this awareness becomes full-blown resentment/hostility. It's not really healthy for us to have this kind of rapid in-migration without the housing in place to be able to absorb the (existing residents who are being displaced by the) new people.

Edit: to be clear, I don't see "people from Ontario are moving here" as the problem, the problem is that these people are inherently in a position to financially out-compete the people who already live here (if they weren't, it wouldn't be possible for them to move here because they wouldn't be able to find anywhere to live). This would be less of a problem if there were more housing available.

[casper]

Originally Posted by WhipperSnapper

I know a few local mortgage brokers and they all have said they have never had to turn down as many mortgages for buyers of homes. I don't know how that will affect values in the future though.

I was offered $1.9 million for my CMHC one and a half storey house that was designed as an affordable home for returning WW2 war vets. Instead, I partnered with the developer who plans to build a larger home (not American/ Vancouver special large) and sell it for $4 million. I never expected things to get this far.

I envision Toronto to lean more and more conservative as the left leaning cash out although I'm not confident in the vision as the Liberals don't seem to be at all concerned about actual solutions over feel good lip service

Not certain Toronto would lean more conservative over time. The population of Toronto is leaning more and more towards people living in condos or townhomes. Not certain it is just the Liberals exiting.

Some of what is going on may be a once-in-a-lifetime event. COVID has taken a large number of positions that traditionally would have been in the downtown core of major cities or office parks in the burbs and make it virtual.

This may be a good thing. Many of these communities like Halifax, Saskatoon, London, Pembroke etc. have grown at a very slow rate relative to the major cities in Canada. Here in BC its Vancouver Island, Fraser Valley, the Okanogan and North that are booking. That said, there is likely more available low cost land to accommodate growth. It just going to take time to ramp up. This may be disruptive but from a sustainability perspective for Canada this may be a positive.

[Hali87]

[delete: double post]

[MolsonExport]

Originally Posted by casper

Not certain Toronto would lean more conservative over time. The population of Toronto is leaning more and more towards people living in condos or townhomes. Not certain it is just the Liberals exiting.

Some of what is going on may be a once-in-a-lifetime event. COVID has taken a large number of positions that traditionally would have been in the downtown core of major cities or office parks in the burbs and make it virtual.

This may be a good thing. Many of these communities like Halifax, Saskatoon, London, Pembroke etc. have grown at a very slow rate relative to the major cities in Canada. Here in BC its Vancouver Island, Fraser Valley, the Okanogan and North that are booking. That said, there is likely more available low cost land to accommodate growth. It just going to take time to ramp up. This may be disruptive but from a sustainability perspective for Canada this may be a positive.

? London is the fourth fastest-growing city in Canada, and the fastest growing city in Ontario.

[MolsonExport]

Originally Posted by Wigs

The Miltonization of Ontario continues unabated
granted, Cobourg is much more charming than Welland.

Someday, all of Southern Ontario will be Miltonized. It can't be reasoned with, it can't be bargained with. It doesn't feel pity or remorse or fear and it absolutely will not stop. Ever. Until the entire province becomes Miltonized.

[casper]

Originally Posted by Hali87

I mean, as a city we've already hit that tipping point.

There are plenty of neat-to-photograph things coming along with the growth, but in practice most of the people I know under 40 who have lived here for over 5 years are worse off than they were 5 years ago, because much more of their income is going towards rent now. Very few of them own property. It's truly a crisis here.

You accompany your statements about Southern Ontarians driving up the housing prices here with grinning emojis but to be honest there's a very stark awareness locally that this is exactly what's happening and unfortunately I don't think it will be long before this awareness becomes full-blown resentment/hostility. It's not really healthy for us to have this kind of rapid in-migration without the housing in place to be able to absorb the (existing residents who are being displaced by the) new people.

Edit: to be clear, I don't see "people from Ontario are moving here" as the problem, the problem is that these people are inherently in a position to financially out-compete the people who already live here (if they weren't, it wouldn't be possible for them to move here because they wouldn't be able to find anywhere to live). This would be less of a problem if there were more housing available.

The obvious solutions to this problem is more co-op housing, where the co-op owns the land. That in effectively provides a rental like structure where the resident has some level of security that increases will be based on operating costs and not land value and stability. These have been around since the 1970s and in principle the government just needs to guarantee loans to create them it does not need to provide any subsidy.

https://chfcanada.coop/

[casper]

Originally Posted by MolsonExport

? London is the fourth fastest-growing city in Canada, and the fastest growing city in Ontario.

That makes sense. Close enough to Toronto but still not in Toronto.

[Hali87]

Originally Posted by casper

The obvious solutions to this problem is more co-op housing, where the co-op owns the land. That in effectively provides a rental like structure where the resident has some level of security that increases will be based on operating costs and not land value and stability. These have been around since the 1970s and in principle the government just needs to guarantee loans to create them it does not need to provide any subsidy.

https://chfcanada.coop/

It's interesting that the website is advertising a conference that will be held in Halifax. It's a model of housing that exists here to some extent but for one reason or another isn't very common - I'd be surprised if even 1% of the housing stock here is managed as co-ops. I definitely noticed they seem to be more common in BC. I'm not sure what the barrier to that is here.

[SignalHillHiker]

Originally Posted by Hali87

I definitely noticed they seem to be more common in BC. I'm not sure what the barrier to that is here.

You just need better weed.

[casper]

Originally Posted by Hali87

It's interesting that the website is advertising a conference that will be held in Halifax. It's a model of housing that exists here to some extent but for one reason or another isn't very common - I'd be surprised if even 1% of the housing stock here is managed as co-ops. I definitely noticed they seem to be more common in BC. I'm not sure what the barrier to that is here.

It is more common on BC.

What I think is the key benefit of this form of housing is it is not run by government but by a locally elected board in each complex. Similar to a strata. Land costs get locked in when the complex is created and it initial mortgage taken out. Members are expected to be involved in managing the property.

Here is a random example of one.
https://www.stillcreekcoop.com/coop/
Membership terms: http://www.stillcreekcoop.com/coop/wp-co...eek-Coop-Membership-Application-2022.pdf

[lio45]

Originally Posted by casper

It is more common on BC.

What I think is the key benefit of this form of housing is it is not run by government but by a locally elected board in each complex. Similar to a strata. Land costs get locked in when the complex is created and it initial mortgage taken out. Members are expected to be involved in managing the property.

Here is a random example of one.
https://www.stillcreekcoop.com/coop/
Membership terms: http://www.stillcreekcoop.com/coop/wp-co...eek-Coop-Membership-Application-2022.pdf

One thing I’m not getting: why didn’t the original creators/funders prefer to go with a regular condo model? Putting potential land value gains off the table boils down to philanthropy towards future members.

Unless it’s govt-funded? (i.e. social housing.) That would of course explain everything.

[lio45]

Just saw your previous post: the government backs the funding (enabling the “members” to do something they couldn’t otherwise) and in exchange for that government backing, they accept to entirely give up the speculation aspect of real estate.

Fair deal, and pretty smart model. Not sure why it’s not more common.

[WhipperSnapper]

Originally Posted by suburbanite

This is kind of the sad part as well. It's not the well capitalized foreign buyers who will feel the pain from rising interest rates, except for maybe blowing up the cap rates on their rental properties if asset prices do fall. It's going to be the young people who stretched to the limits of their financial abilities to move out of the city during Covid, or tried to find a house they could actually raise a family in. The people actually earning a local income trying to afford local housing are the ones in the worst position.

I've been sitting on the sidelines in my Toronto condo that I bought for a pretty reasonable $700 PSF ~4 years ago. I'm waiting for interest rates to rise to see what happens to prices and look for an opportunity to get a semi-detached somewhere around Trinity Bellwoods area. Something I would feel comfortable putting over 40% of my income into if it was going to be a viable long-term housing solution regardless of what changes in my personal life. I know if I do find a good deal, it's probably going to be from a person who overextended themselves trying to follow the dream of our parents' generation where owning a home was sacrosanct.

If we get up to 5% interest rates and we're still in this situation, I'm officially giving up and will likely just look to stay in New York. If I'm going to be a wage slave in an overpriced city, it might as well be the overpriced city.

I was looking around New York last spring and I was shocked what you could get at the lower end compared to Toronto and with respects to much higher average wages. The value increase in Toronto has allowed some high end finishes like granite/quartz to become standard for countertops however, the majority of the finishes are the same low quality — when a one bedroom apartment sold for $150,000 at the turn of the century. Developers aren't cashing in. The price has gone up in tandem with home values.

[thewave46]

Originally Posted by MolsonExport

Someday, all of Southern Ontario will be Miltonized. It can't be reasoned with, it can't be bargained with. It doesn't feel pity of remorse or fear and it absolutely will not stop. Ever. Until the entire province becomes Miltonized.

Heh.

The Terminator at least could be crushed in a press. Miltonization has no way to stop it.

[thewave46]

Originally Posted by lio45

Just saw your previous post: the government backs the funding (enabling the “members” to do something they couldn’t otherwise) and in exchange for that government backing, they accept to entirely give up the speculation aspect of real estate.

Fair deal, and pretty smart model. Not sure why it’s not more common.

I think you just answered your own question.

[someone123]

Originally Posted by casper

It is more common on BC.

Maybe newer and innovative ones are being built but the ones I know of around Vancouver pretty much exactly remind me of the ones in Halifax. Mostly aging 1970's-80's era townhouses and small apartment buildings. There are some nice ones around False Creek. Most seem to have multi-year waiting lists with residents who have been there for a long time. They are not as nice as modern condos but they offer affordability and stability.

In Halifax there are some in the "Mainland South" area which covers areas like Cowie Hill and Spryfield. The North End also has a high concentration of co-op housing.

[JHikka]

Originally Posted by TownGuy

^ Yep. I was checking out Cobourg and this newish build bungalow, siding a busy street, sold for $1,050,000 a couple weeks ago. 38' lot.

This sort of build is pushing further east, too. Colborne has a new subdivison going up and it wouldn't surprise me if they were north of $750K. If you've got $600K to drop you can swing by a condo in downtown Belleville, too!

[lio45]

Originally Posted by thewave46

I think you just answered your own question.

You're even more cynical than I am!