Comments on: Canadian Real Estate Has Never Been Less Affordable, Price Correction To Fix It: RBC

By: Balter

Balter — Mon, 10 Oct 2022 06:13:21 +0000

In reply to Ike.

anyone who owns outright will be fine – millions in a personal foundation or offshore account even better, wait for the bottom and buy all the peasants out – then turn around and rent it back at the most exorbitant possible rates ahhh like da good ol’ days! Only in the last century has a working man even dared to own his own home. We go back to lairds and serfs

By: Ike

Ike — Sat, 08 Oct 2022 07:01:09 +0000

In reply to JCH. Because the interest rates were so low, and the morgage sizes are so large: 700k to 1M+, the affordability increasing effect of lower house prices is cancelled out and then some by interest rates rising 0.75% every month. The longer you wait the more you pay still holds. More or less.

By: JCH

JCH — Sat, 08 Oct 2022 03:04:19 +0000

Didn’t you read the article? These things take time – sellers are not yet facing the reality that they cannot sell for last spring’s prices. Until desperation sets in, house asking prices will remain stuck and therefore sales numbers will keep falling. No sales = no lower comparables = no documented price drops.
Hopefully interest rates will remain this high for the next year (dare I hope for a lot longer?) and that will slowly bring prices down and thus improve affordability again.

By: I.k.Alizai

I.k.Alizai — Fri, 07 Oct 2022 21:04:23 +0000

To boost real state activities n overcome deficiencies of housing, the Bank shd also ponder about introduction of option of repayment of house margage on rental basis besides financing on interest. The cost of a house for those who opt for rental basis plus rental value for the period of repayment be determined dividing the total cost + rental by the period of repayment of loan n monthly
installment be arrived at n fixed for the entire period involved. Various communities
avoid financing on interest basis. Such system is learnt to be in place in UK. This wd motivate such people to invest in housing sectors bring the capital in market which at present is unmobilized/stuck up.

By: Michael

Michael — Fri, 07 Oct 2022 15:55:05 +0000

Any collapse in the real estate market will most likely mirror the extraordinary rise we have experienced over the past few years, and that’s just math and market history. Mean reversion is real, timing it is the hard part.

As well, affordability is irrelevant when the market is in free fall as only experienced buyers will be interested and they will wait for a true bottom…PLUS, getting approved for a 6% mortgage will require bullet proof balance sheets because banks are going to be quite busy writing down risk from their massive lending books and adding new loans isn’t going to be a priority for them.

I don’t know when this ends…I just know it ends badly.

By: Ike

Ike — Fri, 07 Oct 2022 04:20:55 +0000

Doesn’t take a genius to see that house affordability has not improved.

The only ones better off are the banks

By: Ike

Ike — Fri, 07 Oct 2022 02:15:45 +0000

Sure, if one’s got a million or two in cash stashed away ready to deploy at a moment’s notice.

The reality is that rising interest rate and rent are calcelling out any inprovement in affordability.

The kind of housing I can afford to has NOT changed even though the housing price has dropped. I am just bleeding more money to rent while I wait for that magical house affordability to appear.

Drop the house prices AND drop the interest rates then we’re ‘talkin