Canada's 'housing bubble' deemed close to bursting

[lio45]

Agreed, I’ve managed real estate for over 15 years now, and the core principle whenever making improvements is always “will the average tenant find this to be an improvement?”

Often, tenants have demanded modifications that were actually “deimprovements” from the general landlording PoV, like eliminating two separate bedrooms to create a giant second lounge because they think the open space will be cool and they don’t have kids or roommates, and I’ve quickly learned to say no to those.

Actual universal improvements, I’m always okay with that. Tile colors and design, same principle, it has to be neutral and timeless and good-looking to the average tenant of now and of the future.

[lio45]

Originally Posted by swimmer_spe

this comes back to my thinking that your house is a home, not an investment.

…

We’re having this conversation in 21st century Canada.

It’s clearly both. Whether you like that or not.

[someone123]

Originally Posted by lio45

It’s clearly both. Whether you like that or not.

This is true but it doesn't matter to a non-trivial chunk of society. Namely those who don't intend to move out and those for whom the property is not a substantial contributor to their net wealth. I have still heard people in those camps worry about resale value from their renos, but they should probably just do whatever they'd prefer.

Around here in Vancouver a lot of people are kind of stuck where they are living but they always dream about upgrading to some other place so they don't make changes. This could be as simple as them not painting a wall something other than white because they might move, but they have no plan to move and don't move for many years.

In the social circles I'm a part of I think it would be better just to weight this resale value idea about 30% less. For investment properties it's different although even then there's a premium segment where people want something interesting and I wonder if the stultifying design stuff is creating some opportunity. I think this is just going to pop one day and the high end places will have colourful designs with baroque level complexity eventually, and once that ages a bunch of people will say you have to do it for resale value.

[swimmer_spe]

Originally Posted by lio45

…

We’re having this conversation in 21st century Canada.

It’s clearly both. Whether you like that or not.

Tell that to everyone who is seeing their "investment" crash in value. Would you invest in something that has seen a 10%-20% loss in 1 year?

[WarrenC12]

Originally Posted by lio45

In the current micro-unit that I have for the time being, I’m finding that the standard 4-burner stove top (thanks to being a perfectly flat surface, unlike the old-style ones with the exposed elements) is just functionally part of the countertop surface (of which I don’t have that much), so it’s not a problem. Very often, when cooking, the stove top is my preparation surface. One burner is being used and the other three-quarters of the stove top serves as my kitchen counter, where I’m cutting my veggies to throw them in the pan that’s on the one burner getting used.

Pretty sure it’s natural to do this, so I assume everyone else does it, therefore it’s not wasted space. It’s nice to have spare burners too. I used two simultaneously a couple times…

I've never done that, feels like it would create a mess that's a pain to clean up. The kitchen counter works better as a kitchen counter.

The place I was in had an apartment sized fridge and dishwasher, but with a giant full sized oven and stovetop.

[whatnext]

Originally Posted by swimmer_spe

Tell that to everyone who is seeing their "investment" crash in value. Would you invest in something that has seen a 10%-20% loss in 1 year?

People do it with stocks all the time. No investment is guaranteed (outside a GIC), nor should they be.

[swimmer_spe]

Originally Posted by whatnext

People do it with stocks all the time. No investment is guaranteed (outside a GIC), nor should they be.

I am not asking whether people do it, but whether it is sound investment advice.

[lio45]

Originally Posted by swimmer_spe

Tell that to everyone who is seeing their "investment" crash in value. Would you invest in something that has seen a 10%-20% loss in 1 year?

Yes, if I’m confident that in most years, it’ll perform well.

In fact, what served me really well so far is precisely “investing in stuff that has just crashed in value”. Gathering a portfolio of Sunbelt real estate in the early 2010s was one of my best decisions ever (if not the best).

[lio45]

Originally Posted by swimmer_spe

I am not asking whether people do it, but whether it is sound investment advice.

“Do not let the fact that risk is nonzero stop you from trying something if you’ve carefully thought about it” is sound life advice.

[lio45]

Originally Posted by WarrenC12

I've never done that, feels like it would create a mess that's a pain to clean up. The kitchen counter works better as a kitchen counter.

The place I was in had an apartment sized fridge and dishwasher, but with a giant full sized oven and stovetop.

Now I wonder which one of us is the more “typical” person.

In a tiny unit, I’d skip the dishwasher. That’s not really useful for a single person or a couple. I never use it, it feels just as fast to wash my plate and fork manually than to open it, bend over it, and place them in it.

[swimmer_spe]

Originally Posted by lio45

Yes, if I’m confident that in most years, it’ll perform well.

In fact, what served me really well so far is precisely “investing in stuff that has just crashed in value”. Gathering a portfolio of Sunbelt real estate in the early 2010s was one of my best decisions ever (if not the best).

I am not talking about rental properties. I am talking about your primary residence.

[SignalHillHiker]

I use precious little of my kitchen counter. There's a little area probably 2 sq ft between stove and fridge where I do most of my prep, despite having the full length of the kitchen on the opposite wall, minus a double sink.

I can't remember the last time I had a dishwasher. When I lived in Winnipeg I even had a clothes washer that hooked up to the kitchen sink. My parents have always had one but they basically wash every dish before they put it in there so now idea what they're at.

Losing value on a home isn't always the end of the world. I assume this doesn't work at higher values unless salaries are also much higher, but I lost on my last house. Still had enough left over from the sale to use as a down payment on my current home, which is my last. I'll die here. Hopefully not soon, but you know, eventually.

[Truenorth00]

OSFI's new restrictions are fun.

1/...OSFI may require banks to divide a borrower’s mortgage amount by their total annual income. Banks would then have to ensure that at least 75 per cent of their mortgages, for example, have a loan-to-income ratio less than 450 per cent Compared with today, by my estimate, this would limit mortgage amounts for maybe 5 to 10 per cent of borrowers.

2/...limit a borrower’s housing obligations to 39 per cent of gross income, or less. Thus far, OSFI hasn’t capped this number. Now it might. And it might limit the debt ratio exceptions lenders make to get around its stress test.

3/...OSFI says it may implement a new minimum interest rate that is applied in debt-service coverage calculations to test a borrower’s ability to afford higher debt payments in the event of negative financial shocks.

https://www.theglobeandmail.com/investin...king-regulator-mortgage-lending-changes/

Bit of closing the barn door after the horse has bolted though. Bit of CYA after they refused to crack down during the run up in late 2021 and early 2022.

[WarrenC12]

Originally Posted by lio45

Now I wonder which one of us is the more “typical” person.

In a tiny unit, I’d skip the dishwasher. That’s not really useful for a single person or a couple. I never use it, it feels just as fast to wash my plate and fork manually than to open it, bend over it, and place them in it.

I hate washing dishes, but you also can't put everything in the dishwasher and may not run it enough as a single person living alone.

[SignalHillHiker]

I'm ready to write an angry letter. I still haven't shaken my habit of checking real estate listings several times daily that I developed the few months in 2021 that I was temporarily moved back into my parents' place and looking. So this was posted like a day ago, and as of this morning it was 16 hours old and still had no pictures. It's VERY close to me, and I've been curious to see inside. Quite a few homes here have that cut-out access to the backyard that you can see on the left side, but I've never seen one on a house this small. Usually they're on three-storey homes and big enough to drive a small car through. So I've been DYING to see inside.

Well, they finally added pictures. Two of them. Both exterior lol I'm going to lose it

[jonny24]

Originally Posted by rousseau

Aren't wallpaper and carpeting trendy nowadays? In winter I find myself feeling nostalgic about the wall-to-wall carpet of my youth. It adds warmth, is comfy on the feet, and you can roll around on it.

I grew up, turned my back on suburbia and embraced hardwood floors as a vital part of my aesthetic preference for old houses--the 130-year-old floors where where we are now really are eye-catching and sealed the deal for us when we first stepped into this place--but I can't lie, sometimes I catch myself really enjoying the carpet at my Dad's place and I feel like a traitor.

Exactly what sold me on my house I need to refinish them someday, but they're never coming out while they're mine

[jonny24]

Originally Posted by SignalHillHiker

Why anyone would ever consciously choose to live inside a home mirroring that effect is beyond me. Of course, I understand some people prefer that. But I think it’s objectively obvious most haven’t given it much thought, they live in what they think they’re supposed to like. Can’t be good for the mental health. I welcome the switch back to warm tones, even if it is just browns and beiges. I think it’ll be better for a majority of people, a majority of the time.

My wife has informed me that my next project is painting the front hall light grey, cus she just can't stand the beige/creamy coffee colour that they are anymore

[SignalHillHiker]

Well, yet another reason she and I could never be together.

[jonny24]

Originally Posted by SignalHillHiker

Well, yet another reason she and I could never be together.

[SignalHillHiker]

Originally Posted by jonny24

Exactly what sold me on my house I need to refinish them someday, but they're never coming out while they're mine

I fear this is going to betray the level of shantytown (by North American standards) that working class neighbourhoods of downtown St. John's are...

...but I hear ya. I was in this house (according to my realtor) less than two minutes when I said I wanted to put in an offer. And a BIG part of that for me was that the floors were not only hardwood, but the SAME hardwood on both levels. Most houses downtown, every room is a completely different colour of faux wood vinyl lol One room grey, one red, one almost black, one such a light beige you might think it white, etc.