We need a deep dark recession to change the entire mindset on using housing as an avenue to wealth. We havent had a good one in since the 90s so no one remembers what happens to real estate. There will be many bagholders, and i really dont think the govt can control it.
I dont know where they get their CPI numbers. I can't believe they are allowed to just make up numbers. nothing i buy or pay for have gone down. Land tax up 10 % Insurance up 10% Fuel up 10 % Food up 10 % Clothing up 10 % Restaurant Down 100 % because i only eat at home now. Entertainment Down 100 % because i wont pay $900 to see a concert or two. Vacation down 100 % because im not traveling this year.
In order to buy cheaply, I'm waiting for a housing crisis after selling a few houses in 2020. I've been considering buying stocks as a fallback. Do you have any advice on when is the greatest time to make a purchase? On one hand, I continue to see and read about traders making more than $$$k per week. On the other hand, I constantly hear that the market is crazy and in the midst of a dead cat bounce. What causes this?
Most people are used to a bull market and can't manage a crash, but if you know how to navigate and where to look, you'll make a killing. It relies on your exit and entry plan.
It is true that the US stock market had been on its longest bull run ever, thus the widespread panic and frenzy is reasonable given that we are not used to such unstable markets. However, as you pointed out, there are possibilities accessible if you know where to search; in the past 10 months, I've made over $$$k, and it wasn't a difficult plan of action. Because I understood I needed a solid and reliable strategy to navigate better in these times, I hired a portfolio counsel.
I tried researching new strategies to benefit in the current market because my portfolio has been in the sewer for the entire year, but whatever I tried to do just missed the point. Would you mind letting us know who your investment advisor is by name?
My CFA “Jessica Lee Horst”, a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.
Thanks for this. I just googled her name and found her webpage. I'm really impressed with her credentials and I reached out to her since I need all the assistance I can get.
The wisest thing that should be on everyone mind currently should be to invest in different streams of income that doesn't depend on the govt. Especially with the current economic crisis around the word. This is still a good time to invest in Gold, silver and digital currencies (BTC, ETH...
Thanks for the advice! I'm new to financial planning and wasn't sure where to start. Any tips on finding a reliable financial adviser or resource to guide beginners?
As a beginner, it's essential for you to have a mentor that is verified by finra and SEC to keep you accountable. I'm guided by a widely known financial consultant Stacey Macken
Honestly, I'm surprised that this mrs Stacey Macken is mentioned here, came across a testimony about her from one of the beneficiaries on the CNBC news, she seems to be doing extremely well
What impresses me most about Stacey Macken is how well she explains basic concept of winning before actually letting you use her trade signals. This goes a long way to ensure winning trades
You’re so bang on. Everyone has forgotten the 90s. Or even early 1980s when Vancouver lost 40%. It’s been such a long cycle 20yr plus. Sooner or later, there will be a down cycle. I’ve sold my condo last summer and waited for more inventory/selection. We have that now and it’s excited to hear we’re close to above 4.5 MOI to trigger price declines. Vancouver has been very sticky when it comes to price reductions. Canadians are resilient.
@@glengarbera7367I bought my first house for $200k in 1996. Thought I’d got a great deal but sold it for $173k in 2000. After 4 years of paying the mortgage, I only gained enough principal to cover the commission. Only $80 of my $1000 monthly payment went to principal.
Can't forget rent cost and lifestyle factors of not buying. Breaking even is not such a bad thing compared to having spent all that rent money and also having nothong to show for the last 10 years. At least you owned, no one put a notice on your door saying you have 2 months to move. If you buy now, don't go broke over it (buy less house than you maximally can), and plan to be there 10-20 years, I'd say buy the house and focus on your family
Yes exactly... We just bought off market. Fixer upper... Might even just break even after 5 or 8 years BUT we are paying less than the cost rent around here and we won't be told to move along after one year like we have 3 times already
The house price to income in Toronto went from 2.5 to 14 in the last 2 decades and nobody said a word. The gov't was sucking the home buyers dry, the developers were making money hand over fist, the agents loved it, flippers were laughing all the way to the bank.... Wages have been crushed by real estate costs. We are just starting to see int rates hitting mortgage holders, so the pain is just starting to impact the market. We aren't close to an end of this correction. And before people buy in Toronto, remember you are paying 4.5% land transfer and 5% agent fees eventually.... that could end up being a 150-200k dollar penalty..... I talked to a colleague in late 2001 and told him I was thinking of buying a house. He said he was just breaking even after buying in 1989.... ouch.
@@markz1013 it's frightening. The whole point of having a capitalist market is the concept of the market adjusting according to affordability. But you are right. And that makes everything worse as it creates a bloated unresponsive sector.
@@markz1013 well if it doesn’t correct, say hello to 10 yrs of stagflation in Canada. Oil is technically in a correction dipping under its 200 week moving average. The whole immigration pump is a brutal example of how NOT to drive GDP numbers…. A lot of headwinds ahead.
If you go back to 1972 it was 2 times the husbands income for a new detached house so today it would actually be 28 times a singles person's yearly salary.
Jon a year ago you said that prices would be down to $540,000 or lower by this point in the year. The average price hasn't moved at all. How many predictions is that you have gotten wrong now?
Deflation is needed. Canada is one of the most indebted populaces in the world.. canadians can't afford 0% inflation let alone 2%. Would be nice to get back to 2 meals a day someday, let alone 3..
This reminds me of what I read recently regarding a comparsion between current market vs. 2008 Tech bubbles. In short, if you buy a company at a high valuation (expensive), your long-term expected annual returns are likely less simply because the starting point is already so high. Investors aren't willing to pay a premium
Were waiting in the wings with 500k equity and 240k income. Will we buy when rates go down? Probably, if the market stays cold. I am certainly not paying over asking or waiving inspections..
I think the majority of Canada's real estate is fairly safe, but Vancouver and Toronto's prices will really suffer from investors and the Chinese exiting the market 2024. Good realtors in these cities will help their clients price competitively. So much inventory is stale because it's overpriced, and unsold listings will continue to pile up in the fall if sellers don't review recent sales and price ahead of the falling market.
People do not understand that its the house prices that matters the most not the interest rate as much. House price is the biggest determinor of affordability. Interest rates can always move down, due to the decisions of the Bank of Canada. Once you overpay for your house, you will lose money if you do not own for the long term
@@parkerbohnn no they won't. The BOC is very aware that this is exactly what they want to avoid because both rent and home prices will drive the CPI inflation numbers up. This is the exact thing they learned from the 80s and early 90s. You can easily spark a 2nd round of inflation and that ends very very badly.
@@kevinn1158 Never in the past has rent not gone up when home prices went up. Just like we've seen since 2015 rate cuts will push home prices way up and rents will follow.
Anyone who buys real estate in this market needs their head examined. I refuse to be a debt slave. The housing market needs to fall by 40% to get my attention.
It shocks me how everyone I talk to just shrugs at the idea of spending 70% of their income on a mortgage.... Girlfriend and I are at the point where we are thinking about saving for a house and starting a family, but at the current prices it seems way more savvy to rely on other investments for savings and just be forever renters.
I feel you. I really do. But do you remember when people said EXACTLY this 5 years ago, 10 years ago, 15 years ago and 20 years ago? I definitely do. And many of those people are now permanently priced out of the market. They all wish they bought years ago, when they thought it was “too expensive.” Now I am NOT saying prices won’t go down - I have no idea what will happen. I’m just saying: how are you so certain of yourself when this opinion has been the wrong one over and over again for so many years. Even now, prices have fallen a little from the peak, but the crash John has been predicting for years simply has not happened.
Just buy in your means, people that force thenselves to buy in Vancouver or Toronto are delusional. Lots if great houses out there if you arent deadly afraid of not living a massive population center
We have bought a $140,000 condo in Regina that suits our needs just fine (63 yr old), my husband is staying in Vancouver to finish the Sky Train project. We sold in 2017 in order to take care of my parents, but, we could never get back in the market…we have been Reno-victed from a beautiful home rental. We had to make a decision.
The problem of any young people getting into this market is 1st: the amount of down payment needed is way too high. 2nd: Even in the lower end of the market, the ratio of loan to value will be so high that it can only lead to insolvency. 3rd: Valuation is too high, wages is too low even for the top 10 percent earners in the GTA.
The gov loves picking winners and losers ... so when the PM says "houses have to maintain their values" he is directly choosing one group of people (house owners) over the other (those who dont own the house ... mostly younger Canadians). Younger people may be more likely to become radicalized (or ostracized from the society) when they realize that the system is stacked up against them. And it is hard to blame them.
@@2john149you laugh but put the offer of your dreams in, maybe you will get it. Or laugh from the sidelines on the throne. Choose your adventure. The reality is house values are down, those who need to sell will take what they have to. There are opportunities out there. Take them or leave them.
canada was much smaller back than, there was way less pressure on available homes, and interest rates where much higher. Curve that you showed that refers to recovering is indeed folowing interest rates fall from peak of 21%. Don't get me wrong but your analysis holds no tangible value, but maybe as anchor to confrontational bias. the fact is that if you wanna buy property anywhere you will be debit slave, it is today's reality. if you have family of 4 you need minimum $3k to rent livable space in lower mainland, your mortgage would not be far off. Tho, prices will not go much more down before they go up. They will go up, because Canada is growing really really fast. there is no way around it. Speacially here in lower mainland where just a licence to build single apartment cost $60k.
Housing prices might decrease as many owners in Ontario renew their mortgages at high rates, leading to an increase in listings. This creates competition among sellers, pushing them to lower prices to attract buyers. Additionally, many will try to sell their secondary properties, further increasing supply and putting downward pressure on prices.
Study by Fraser Institute, average household spent 43% of its income on taxes - Thanks to JT. Now, who can afford these high price houses if no more money left after taxes.
That is why we are letting in 1.3M newcomers into the country (a year) to make sure that "real estate maintains its values", as our Dear Leader has recently stated.
I bought my last house in 1991 and was stuck there for 15 years with a 10% mortgage. I sold in 2007. I did manage to pay it off over about 13 years but including all expenses (interest, taxes, commuting costs, maintenance, utilities, sales commissions) I probably just broke even after 16 years.
@althunder4269 so if you rent, you have no commuting costs or utilities? So you think any other investment would pay for a house in 13 years while you are still paying rent. So you were dumb enough to sell a house you paid off in 13 years for $0 ?
"We’re in a housing crisis. Why are so many builds going bust? | About That" - CBC youtube. A good boiled down clip on condo prebuilds health in Toronto, to add to the conversation. (I like "market place" and "about that" as I believe those segments are politically neutral)
Society constantly forgetting or ignoring thresholds exist in everything and are connected only noticeble in the extremes...to the unprepared.....historic cycles exist...for many reasons....the largest society's mindset
Early last year he said late 2023, early 2024. This year it's late 2024, early 2025. Want to take a guess what he is going to say next year? A year ago, almost to the day he was saying that prices would be $540,000 by this time. Well, they are $700,000 today, exactly where they were last year.
@@johnnylongstocking183 First of all they created a perfect environment for money laundering and fraudulent lending. Then when shit hit the fan with interest rates they allowed and told the banks to save everyone that was overextended. We won't even start with the manipulated stats coming out of statscan. This is far from a free market.
I think people need to look at part of the chart that shows 1990 - 2001. The market took over 10 years to recover ... and that's not factoring in general inflation over that period. Yes, over the "long term" prices go up, but how long term is long term?
@@elai3147 The price run up from 2007 to 17 would have helped but It probably would still have been better if I'd just put my money into an S&P index fund because I'd have had that extra 15 years of growth. But I can't say for sure because I've never run the numbers. Selling in 2007 was also a lifestyle choice because I was tired of living in that house. I just got caught up in the real estate mania like everyone else did at that time. I also got ripped off when I bought the place but that's a whole other issue. I live and learn and move on but the whole thing did sour me on real estate.
True. But … have you looked at the S&P chart after the internet crash. Took a long, long time to recover. So … not necessarily better than real estate.
Who is buying homes when people can't find jobs. The economy is not strong, so if you aint a doctor, lawyer, teacher, or in any job that's not recession proof, why do that to yourself.
In the growth by asset class chart you missed talking about leverage. One of the factors with real estate is people have access to very easy loans to cover their costs. I purchased my first condo with 0% down in 2007 though now a minimum of 5% is required and of course CMHC fees apply if paying less than 20%. So the actual return is based on the buying and selling costs (including CMHC fees if applicable and closing costs), the mortgage interest paid and how much money was ever put into the mortgage. Effectively real estate gives buyers an ability to over leverage themselves in ways that would be harder to do if they bought stocks and bonds. We took a boring safe low return investment class and turned it into a high risk high reward investment class then hit the affordability ceiling turning it into a high risk low reward investment class.
We bought a house for the first time this year and got 5.01. Now we are stuck with that rate for the next 4 years as we watch rates go down. Really sucks.
It is better to have a house and get equity rather than pay rent and give equity to a landlord. The only time renting makes sense is if you are not planning on staying where you are.
Enjoy your house. Your rate is historically about normal, your house price might come down but who cares if you don’t sell. Keep some dry powder, enjoy life as a homeowner. If you do it right, in 20-25 years you’ll have no mortgage. In 5 years you get another shot at rates.
we are at 5.7 haha sucks but all we have to do is to just work/eat/sleep for the next 5 years. No movies/restaurants/etc NO EXTRA SPENDING until we can lock in again at a lower rate.
People who bought near the peak, paid down their mortgage instead of paying rent. Could you include a line to your graph with estimated net asset value including paying down the capital? I'm sure it would be a lot of work, but it would be interesting. I'm not saying that buying at the peak is ok - I did it in 1990 - It wasn't ok! But you have to live somewhere, and you either pay a mortgage, or you pay rent.
Another "Like" for Jon Flynn. Have to agree, many sellers think it's Jan/Feb 2022 with their listing prices. Don't believe the hype spewed by real estate pumpers. Why would you buy an overpriced house at current interest rates when approx. 80% of your mortgage payment is interest? No thanks, the bubble will burst.
Crazily high prices (of pre-COVID) went thru the roof during COVID mainly because the interest rates went to basically zero. Then, interest rates went up and prices remained the same (more or less). Now, everyone is waiting for interest rates to drop so that prices can continue go up. Crazy! Shows how disconnected we are from the reality and how deeply in a bubble we are. More like a national mindset bubble ... built over years and years of speculative real estate supported directly and directly by various gov policies. But we cant live by our own rules and the bubble will eventually burst.
It's not even prices going up that makes you all your money it is part of the money you would have put towards rent that goes towards equity in the house. I would be paying $1350 in rent a month or $1350 a mortgage and risk having to do maintenance. In 5 years my $1350 rent would be $1800. On the $1350 $700 of the dollars goes towards interest, and $650 goes towards the principal. Which means I now have $39,000 rather than have paid rent. If rent was $700 your math makes sense but the landlords are getting you to cover the whole mortage not the interest.
When you buy a home, you have closing costs, transfer taxes, yearly property tax, maintenance/repairs, financing costs. It's a better financial decision to rent when we are at the top of the cycle.
@althunder4269 corporations are also buying houses. We don't have enough houses, and house prices didn't get the increase with the inflation because of the interest rates. Once interest rates go down you will see them skyrocket. $.70 5 years ago is $1 today. More buyers and lack of supply, and this guy thinks the price is going to go down when interest rates drop.
@@James-tk9oy There's not much of that happening in Canada it's occurring more in the US. We don't have a housing shortage in Canada, we have a housing affordability issue here. House prices decline when interest rates decline because that's when we are in a recession. Unemployed people don't buy houses.
The dollar has devalued so much that 30k interest makes some sense. With inclines stagnating it's an issue. Please do a video on home builder profit margins.
YES!!! that's exactly her name (Mrs Elizabeth Regina Nelsen) so many people have recommended highly about her and I'm just starting with her from Brisbane Australia🇦🇺
If buyers can hold off until spring 2025, you will have listings built up and price declines from winter, coupled with the announcement of the primary residence gains tax in the 2025 budget.
Hold some asset like gold right now Cash still has a chance of inflating And between the push against temporary workers and AI, fewer people have the salaries to justify these prices These condos are going to probably turn into affordable housing lol, as a way to buyout bankrupt developers and solve the homelessness crisis
Nice charts but not inclusive. Housing costs are typically leveraged by way of mortgages. Also, alternative to owning is rent. This is not at all reflective in your numbers. You are simply comparing 2 assets, initial investment is cash purchase and then return. I suggest you do a more complete comparison including all alternative costs such as rent.
Believe it or not, after 3-4 months of listings being revised down, i am starting to see house prices being revised UP in the Outaouais. I don't get it. It is really owners directing their agents to raise the price or it is greedy agents trying to upswing the prices on us again?
Wait until all the job losses. There's going to be people with no cash, because it's all gone into the house, facing 5K plus mortgage payments while living off UI if they're lucky Thank your incompetent government.
New Brunswick here. Our housing market is still crazy. Housing prices last November - February looked like they would settle down but now they’re on fire again. Two houses in my neighbourhood sold well above asking within days. One was a 3 bed, 1 bath, no garage, no basement that sold for $400k, which was $100k above the asking price. Another small house was listed for $250k and sold almost instantly after a bidding war.
@@howzertech2222 That's insane. I make good money for New Brunswick as a software developer, well above median for this province, and I can't afford any housing, and I'm stuck where I am in my 2 bedroom apartment because the landlord has been gracious and it's currently at 868$ a month while my neighbour pays 1400$ for the same thing. Most of my friends have to return to living with their parents in their 30s. It's nuts. I'm lucky I can even live independently. I think we're gonna end up like Argantina.
John, Real Estate is the only asset class in that graph that is leveraged, so you would need to account for that. If I put 20% down I still wouldn’t beat the S&P but I sure as hell would do well. Plus I’d be paying the loan back in inflation devalued dollars. It’s like it’s a contest of the pumpers vs the dumpers on the interweb.
Can't by what we can't afford ....the way of the world since 2004.....living luxuriously on credit.....doesn't last long and is a long climb out...still from the 2007 world financial crash
Jon completely leaving out the chart from the crea stats showing every province having price increases except for BC and Ontario. Why did you leave that one out Jon? Doesn't fit your market is crashing narrative hey.
@@johnnylongstocking183 Well, unless one just LOVES enslaving himself in a crushing debt, what is wrong with the advice: "refrain from buying at this point in time"? The prices are simply out of touch, with the economy not doing so great. Why would anyone with a logical reasoning expose himself to such an imminent risk that can EASILY ruin that person? Common sense? Math? Risk analysis? Anyone? Whether the market will crash or not, is another thing.
@@johnnylongstocking183 Yes, that makes sense in an average market, with a solid economy. But, in this case, the big issue is that not more than perhaps 1-2% of all people can buy anything within say GTA. It's not within anyone's means. That's why the situation we're having today is unheard of. It all just screams: "unsustainable". It gets even worse if you want to buy something 300-400km away from Toronto, since the prices are still way too high, with the salaries even way lower than in GTA. So, a combustible situation we're having here.
Im no expert, but Canada's National debt is at the highest Level ever, higher than WWII era, Might be more going on here than high house prices and inflation. Might be nothing also🤔
It'd be nice to see the chart in inflation-adjusted numbers as well. Due to inflation if you bought a property in Canada in 1990 for ~250k, in real terms you'd have to sell for over $300k in 2000 just to break even in real terms, not accounting for fees/taxes/interest etc. It looks like the break-even in real terms wasn't until around 2005 aka. approximately 15 years later when the bubble started to reinflate.
Comparing the 80ies and now with mass immigration is not a good metric... with Canada wanting 100 millions in 2100... real estate should go up slowly over years , it's simple math
@@matta7215100%, new technologies in home building like 3D printed homes that accelerate new home stock will devastate home prices. Baby boomers dying off, only so many replacement ppl you can get to come over especially considering Canada isn’t a great country for many new immigrants. What if we added 50,000 new home builds per year? Not a crazy number, 50k more homes built per year and prices start tanking.
Lol still too high yes in the following places Niagara falls, cambridge etc Too funny the prices will not be coming down to what they want 50% Omg ok how about a rent slave. Joke advise
Any idea when will affordability return ? Can you also make one video on Condo Maintenance fee ? It’s just too high even if the price of the condo is in affordable range
Hi Jon, how do you factor in build costs? I wonder if your frame of reference is your area. Some places in Canada it may still be wiser to buy. As well, the overall quality of life bonus of having a house still stands.
In central Edmonton, all the houses with "Sold" signs are sub 500k tear-downs; all the houses for sale and not selling are 700k plus newer builds. So I'm guessing that it's mostly developers/investors looking for properties to build huge new houses on that most people already can't afford and so aren't buying.
Jon left out the crea chart showing every province except BC and Ontario has price increases this year. If it was every province with decreases expect one or two Jon would be jumping out of his chair to show that chart.
imagine you have $300k and you want to start a family right now do you buy a home and go into debt slavery or move to a lower cost of living place, buy bitcoin, and lean on savings? im gonnna buy a home because i wanna install new carpet guys
What are the signs of recession? There are several key indicators that economists watch to determine a recession is occurring or imminent: Rising Unemployment: A steady increase in job losses and a surge in the unemployment rate are strong signals1. Decline in Consumer Spending: Since consumer spending drives a significant portion of economic growth, a noticeable drop in spending can indicate a recession2. Decreased Personal Income: When personal income, adjusted for inflation, starts to fall, it suggests that people have less money to spend, which can slow down the economy2. High Inflation: Persistent high inflation can erode purchasing power, making it harder for consumers to buy goods and services3. Negative Yield Curve: This occurs when long-term interest rates fall below short-term rates, often seen as a predictor of economic downturns3. These indicators, among others, help economists and policymakers assess the health of the economy and predict potential recessions.
We’ve been in a recession for awhile in real terms but temp foreign worker + student visa program (rapid population growth) has masked the true state of our zero growth economy. UK in similar situation imo.
House price will go up as cost of building them is still much higher with inflationary cost now and future.Unless there are significant change in housing reforms the situation will be like this in major cities like Toronto, Montreal , Calgary and Vacouver
If you pay $3000 a month rent for the next year that will be $36000. House prices will be down by far more than $36000 in one years time so you will still be ahead.
@@markb8360 every province in Canada except Ontario and BC has rising prices. Jon left that chart out of this video. It's on the crea stats package Jon is talking about in this video.
When a bank makes a loan, something like 90% of it is made out of thin air. It can only absorb so many bad loans before it becomes insolvent. Right now in Canada you can see the "we don't believe you're solvent opinion" appearing in the overnight lending market between the big banks with the feds forced to step in as the lender of last resort.
so you are saying that Nick Murray is a dumbass lol: Timing the market is a fools game, whereas time in the market is your greartest natural advantage. - Nick Murray
You are absolutely correct. Honestly the only advantage to buying real estate right now is leverage. It’s tough to get the bank to loan you 4x your annual income paid over 30 year to invest in the S&P. Anyone could buy their principal residence, rent it out and only spend 700 days over the next 5 years in Canada keeping their residency and then sell. Regardless of increase, the tax free equity alone is worth it.
Why would one lose money after 10y or 15y of renting purchased property? Nobody buys investment property and just locks it up for years. One can lose money by trying to quickly flip it.
I actually know of a few properties that are sitting empty, locked up for many years. Mostly Chinese from Hong Kong that bought in the late 80s early 90s. They no longer live in Canada. But the house sits.
@@mr2_mike Any reasonable investor tries to maximize profit. Renting an investment property is a no-brainer. IMHO buying and locking up investment property for years is a sure indicator of some shady business
We’re watching houses drop in a BIG way on Vancouver Island. $100 000 k drops. Looking at what they paid in 2022 we can already see they’re listing 100k less than they paid. Everyone listing at crazy $’s and watching them drop 100 000 k within 4-6 weeks. It’s incredible. We were going to buy but no way. Waiting now!!
Thanks for this video. This cleared lots of doubts in my mind. I have done similar calculations and completely agree with you. I hope you will put more informative videos and give a clear idea in the future when to enter the market.
Poilievre recently commented he doesn't believe the Canadian RE market is in a bubble. He contends there is underlying demand to support the current prices. I think he might be right given the high cost of permits, taxes, materials and labour and the massive increase in population over the past 5 years. In your opinion, is there any merit to what he's saying?
I dont expect anything diff from Poilievre. Few minor differences (climate change, less virtue signaling and less identity politics) but when it comes to real estate and maybe even mass immigration ... he may be just JT-light. The only real diff would be Maxime Bernier - but I cant see him getting anywhere with our far-left media landscape.
A 40% drop would have significant economic implications, not just for housing.
a sharp drop would impact related industries like construction and finance.
And would likely lead to a broader economic downturn.
Ripple effects would be felt throughout the economy, including job losses
I'm worried about the impact on my retirement savings, already living on a fixed income.
@RoseBalerus Alternative investments, like bonds or gold, could provide a hedge
We need a deep dark recession to change the entire mindset on using housing as an avenue to wealth.
We havent had a good one in since the 90s so no one remembers what happens to real estate.
There will be many bagholders, and i really dont think the govt can control it.
I agree
I dont know where they get their CPI numbers. I can't believe they are allowed to just make up numbers. nothing i buy or pay for have gone down.
Land tax up 10 %
Insurance up 10%
Fuel up 10 %
Food up 10 %
Clothing up 10 %
Restaurant Down 100 % because i only eat at home now.
Entertainment Down 100 % because i wont pay $900 to see a concert or two.
Vacation down 100 % because im not traveling this year.
They’re professional manipulators
Another excellent video based on facts, data and reality. Thank you for continuing to tell the truth Jon, please continue to do so.
Appreciate it thanks
In order to buy cheaply, I'm waiting for a housing crisis after selling a few houses in 2020. I've been considering buying stocks as a fallback. Do you have any advice on when is the greatest time to make a purchase? On one hand, I continue to see and read about traders making more than $$$k per week. On the other hand, I constantly hear that the market is crazy and in the midst of a dead cat bounce. What causes this?
Most people are used to a bull market and can't manage a crash, but if you know how to navigate and where to look, you'll make a killing. It relies on your exit and entry plan.
It is true that the US stock market had been on its longest bull run ever, thus the widespread panic and frenzy is reasonable given that we are not used to such unstable markets. However, as you pointed out, there are possibilities accessible if you know where to search; in the past 10 months, I've made over $$$k, and it wasn't a difficult plan of action. Because I understood I needed a solid and reliable strategy to navigate better in these times, I hired a portfolio counsel.
I tried researching new strategies to benefit in the current market because my portfolio has been in the sewer for the entire year, but whatever I tried to do just missed the point. Would you mind letting us know who your investment advisor is by name?
My CFA “Jessica Lee Horst”, a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.
Thanks for this. I just googled her name and found her webpage. I'm really impressed with her credentials and I reached out to her since I need all the assistance I can get.
The wisest thing that should be on everyone mind currently should be to invest in different streams of income that doesn't depend on the govt. Especially with the current economic crisis around the word. This is still a good time to invest in Gold, silver and digital currencies (BTC, ETH...
You're correct!! I make a lot of money without relying on the government. Investing in stocks and digital currencies is beneficial at this moment.
Thanks for the advice! I'm new to financial planning and wasn't sure where to start. Any tips on finding a reliable financial adviser or resource to guide beginners?
As a beginner, it's essential for you to have a mentor that is verified by finra and SEC to keep you accountable. I'm guided by a widely known financial consultant Stacey Macken
Honestly, I'm surprised that this mrs Stacey Macken is mentioned here, came across a testimony about her from one of the beneficiaries on the CNBC news, she seems to be doing extremely well
What impresses me most about Stacey Macken is how well she explains basic concept of winning before actually letting you use her trade signals. This goes a long way to ensure winning trades
You’re so bang on. Everyone has forgotten the 90s. Or even early 1980s when Vancouver lost 40%. It’s been such a long cycle 20yr plus. Sooner or later, there will be a down cycle. I’ve sold my condo last summer and waited for more inventory/selection. We have that now and it’s excited to hear we’re close to above 4.5 MOI to trigger price declines. Vancouver has been very sticky when it comes to price reductions. Canadians are resilient.
My dad was offered 570k in 1986 for our house. He wanted 600k. He sold it in 1998 for 410k. So the whole idea that prices always go up is false.
@@glengarbera7367I bought my first house for $200k in 1996. Thought I’d got a great deal but sold it for $173k in 2000. After 4 years of paying the mortgage, I only gained enough principal to cover the commission. Only $80 of my $1000 monthly payment went to principal.
Can't forget rent cost and lifestyle factors of not buying. Breaking even is not such a bad thing compared to having spent all that rent money and also having nothong to show for the last 10 years. At least you owned, no one put a notice on your door saying you have 2 months to move.
If you buy now, don't go broke over it (buy less house than you maximally can), and plan to be there 10-20 years, I'd say buy the house and focus on your family
True but the reason your getting the notice to move is probably because some speculator owns the place and wants out
Yes exactly... We just bought off market. Fixer upper... Might even just break even after 5 or 8 years BUT we are paying less than the cost rent around here and we won't be told to move along after one year like we have 3 times already
The house price to income in Toronto went from 2.5 to 14 in the last 2 decades and nobody said a word. The gov't was sucking the home buyers dry, the developers were making money hand over fist, the agents loved it, flippers were laughing all the way to the bank....
Wages have been crushed by real estate costs.
We are just starting to see int rates hitting mortgage holders, so the pain is just starting to impact the market. We aren't close to an end of this correction.
And before people buy in Toronto, remember you are paying 4.5% land transfer and 5% agent fees eventually.... that could end up being a 150-200k dollar penalty.....
I talked to a colleague in late 2001 and told him I was thinking of buying a house. He said he was just breaking even after buying in 1989.... ouch.
What should happen probably won't. They are doing everything in their power to not allow the market to correct.
@@markz1013 it's frightening. The whole point of having a capitalist market is the concept of the market adjusting according to affordability. But you are right. And that makes everything worse as it creates a bloated unresponsive sector.
@@kevinn1158 Yup. We are very far from a free market in Canada.
@@markz1013 well if it doesn’t correct, say hello to 10 yrs of stagflation in Canada. Oil is technically in a correction dipping under its 200 week moving average. The whole immigration pump is a brutal example of how NOT to drive GDP numbers…. A lot of headwinds ahead.
If you go back to 1972 it was 2 times the husbands income for a new detached house so today it would actually be 28 times a singles person's yearly salary.
Jon a year ago you said that prices would be down to $540,000 or lower by this point in the year. The average price hasn't moved at all. How many predictions is that you have gotten wrong now?
You’re my top commenter
@@jonflynn can't answer the question hey? Typical Jon.
@@johnnylongstocking183 Jon is always wrong, but he delivers the mis-information so confidently, that’s all that matters.
Jon, is he wrong though? Did you not say that?
@@jonflynn You mean a spammer or a bot? Most likely a speculator loosing a sh*tload of money and hoping for a miracle.
Deflation is needed. Canada is one of the most indebted populaces in the world.. canadians can't afford 0% inflation let alone 2%. Would be nice to get back to 2 meals a day someday, let alone 3..
This reminds me of what I read recently regarding a comparsion between current market vs. 2008 Tech bubbles. In short, if you buy a company at a high valuation (expensive), your long-term expected annual returns are likely less simply because the starting point is already so high. Investors aren't willing to pay a premium
Exactly
Thank you for all the info--here from Calgary!
Welcome!
Were waiting in the wings with 500k equity and 240k income. Will we buy when rates go down? Probably, if the market stays cold. I am certainly not paying over asking or waiving inspections..
@@jmb9701 good,plan! Will you go variable or fixed?
Me either
Edmonton condos dropped more than 50 percent between 2007 and 2023. 16 years and 50 percent lower non inflation adjusted.
Speculators haven’t done their history
I think the majority of Canada's real estate is fairly safe, but Vancouver and Toronto's prices will really suffer from investors and the Chinese exiting the market 2024. Good realtors in these cities will help their clients price competitively. So much inventory is stale because it's overpriced, and unsold listings will continue to pile up in the fall if sellers don't review recent sales and price ahead of the falling market.
Great point
Don’t believe a word CREA says. In the last 50 years I have never heard CREA say anything negative about the real estate industry.
I don’t understand how this can be true, though. Don’t they just publish the data?
Jon. Consistently good info, observations, guidance and advice. Well done!
People do not understand that its the house prices that matters the most not the interest rate as much. House price is the biggest determinor of affordability. Interest rates can always move down, due to the decisions of the Bank of Canada. Once you overpay for your house, you will lose money if you do not own for the long term
Losing money is guaranteed when buying at all time highs (all time in modern history) smh
Still too much volatility so wait short term. Educate yourself on all things house buying & ownership. Pay off all debt.
I'll add, the BOC won't drop rates much lower seeing the rents or home prices not correcting.
BOC rate cuts will drive rent prices to the moon.
@@parkerbohnn no they won't. The BOC is very aware that this is exactly what they want to avoid because both rent and home prices will drive the CPI inflation numbers up. This is the exact thing they learned from the 80s and early 90s. You can easily spark a 2nd round of inflation and that ends very very badly.
@@kevinn1158 Never in the past has rent not gone up when home prices went up. Just like we've seen since 2015 rate cuts will push home prices way up and rents will follow.
Hope all the landlords are on board for twice the amount of occupants in the units, otherwise no one will be able to float the bill.
I agree
True still over priced
Whole Canada real estate market will crash except CALGARY. Its getting expensive day by day. House prices will only increase here.
Do you have any data or reasoning to back that up?
Half of eastern Canada is trying to move here. How will demand ever drop??
It's like people do not understand compound interest or something, I just do not get how people can spend 700K on a mediocre house in Calgary.
Because they have never felt the crushing weight of debts and job loss resulting in forced decisions
inflation compounds too. usually 3% a year. inflation eats debt and poops out higher prices. that is the reason RE is always going to go up.
Friend of mine bought in Calgary down in Mahogany for 350, 10 years ago, he sold it for a cool million and now moving back east
@@branscombe_ cool story.
@@branscombe_ I missed that train.
Even John conceded that real estate is a good investment over the long term. 😂
If you live in it and didn’t buy near the peak of a bubble yes
@jonflynn low leverage, strong balance sheet (that allows you to hold the property for 10+ years) buying near the bottom are all important
Anyone who buys real estate in this market needs their head examined. I refuse to be a debt slave. The housing market needs to fall by 40% to get my attention.
It shocks me how everyone I talk to just shrugs at the idea of spending 70% of their income on a mortgage.... Girlfriend and I are at the point where we are thinking about saving for a house and starting a family, but at the current prices it seems way more savvy to rely on other investments for savings and just be forever renters.
Waiting every day =1k less and no debt LOL, long way to go to bottom.
Too many people want to get rid of the large amount of MONEY LAUNDERING.
@strigiformsW what happens if it increases to 75% or 80%? It's not out of the realm of possibility.
I feel you. I really do. But do you remember when people said EXACTLY this 5 years ago, 10 years ago, 15 years ago and 20 years ago? I definitely do. And many of those people are now permanently priced out of the market. They all wish they bought years ago, when they thought it was “too expensive.” Now I am NOT saying prices won’t go down - I have no idea what will happen. I’m just saying: how are you so certain of yourself when this opinion has been the wrong one over and over again for so many years. Even now, prices have fallen a little from the peak, but the crash John has been predicting for years simply has not happened.
The only honest real estate agent.
Honest or just says what you want to hear?
Thanks
Just buy in your means, people that force thenselves to buy in Vancouver or Toronto are delusional. Lots if great houses out there if you arent deadly afraid of not living a massive population center
Average price in my region is $700k which is insane given average household incomes
We have bought a $140,000 condo in Regina that suits our needs just fine (63 yr old), my husband is staying in Vancouver to finish the Sky Train project. We sold in 2017 in order to take care of my parents, but, we could never get back in the market…we have been Reno-victed from a beautiful home rental. We had to make a decision.
The problem of any young people getting into this market is 1st: the amount of down payment needed is way too high. 2nd: Even in the lower end of the market, the ratio of loan to value will be so high that it can only lead to insolvency. 3rd: Valuation is too high, wages is too low even for the top 10 percent earners in the GTA.
The gov loves picking winners and losers ... so when the PM says "houses have to maintain their values" he is directly choosing one group of people (house owners) over the other (those who dont own the house ... mostly younger Canadians).
Younger people may be more likely to become radicalized (or ostracized from the society) when they realize that the system is stacked up against them. And it is hard to blame them.
You can try and sell your million dollar home now for $800k or you can wait until next year and try and sell it for $500k…your call. (I’m 65)
If you are in a position to get an approval you should purchase a home and now might actually be an advantageous time to do so.
😂😂😂😂😂
@@2john149you laugh but put the offer of your dreams in, maybe you will get it. Or laugh from the sidelines on the throne. Choose your adventure. The reality is house values are down, those who need to sell will take what they have to. There are opportunities out there. Take them or leave them.
canada was much smaller back than, there was way less pressure on available homes, and interest rates where much higher. Curve that you showed that refers to recovering is indeed folowing interest rates fall from peak of 21%. Don't get me wrong but your analysis holds no tangible value, but maybe as anchor to confrontational bias. the fact is that if you wanna buy property anywhere you will be debit slave, it is today's reality. if you have family of 4 you need minimum $3k to rent livable space in lower mainland, your mortgage would not be far off. Tho, prices will not go much more down before they go up. They will go up, because Canada is growing really really fast. there is no way around it. Speacially here in lower mainland where just a licence to build single apartment cost $60k.
Housing prices might decrease as many owners in Ontario renew their mortgages at high rates, leading to an increase in listings. This creates competition among sellers, pushing them to lower prices to attract buyers. Additionally, many will try to sell their secondary properties, further increasing supply and putting downward pressure on prices.
Study by Fraser Institute, average household spent 43% of its income on taxes - Thanks to JT. Now, who can afford these high price houses if no more money left after taxes.
You don't want to see where carbon tax is headed for 2025.yikes.
That is why we are letting in 1.3M newcomers into the country (a year) to make sure that "real estate maintains its values", as our Dear Leader has recently stated.
Anybody price lumber lately , it's 3 to 4 times more than it should be , it's called inflation . I try to re-use lumber were ever possible !
I use the name as a slang term for whipping a horse termed under the lumber meaning under the lash or under the whip.
I bought my last house in 1991 and was stuck there for 15 years with a 10% mortgage. I sold in 2007. I did manage to pay it off over about 13 years but including all expenses (interest, taxes, commuting costs, maintenance, utilities, sales commissions) I probably just broke even after 16 years.
And factoring inflation into it, I did lose money.
@@althunder4269thanks for sharing
Slumlords are definitely still buying
@@Elevatevisiondigital slumlords, eh? lol
@althunder4269 so if you rent, you have no commuting costs or utilities?
So you think any other investment would pay for a house in 13 years while you are still paying rent.
So you were dumb enough to sell a house you paid off in 13 years for $0 ?
The fear many have is not if this near the top of the bubble but that this is the new baseline.
Thanks. Will wait.
Very informative realestate peogram.
Many many thanks
Already seeing job losses and weaknesses in employment across Canada.
I am afraid it is just starting ...
"We’re in a housing crisis. Why are so many builds going bust? | About That" - CBC youtube. A good boiled down clip on condo prebuilds health in Toronto, to add to the conversation. (I like "market place" and "about that" as I believe those segments are politically neutral)
It’s CBC, no thanks
@@musicbygoldenj Nothing is neutral on CBC.
Is it right to buy in GTA specially in Mississauga?
I don’t think it’s right to buy anywhere at these inflated prices unless you know the risks
Inflation down to 2.5
Chicken costs 20 bucks
Sure sure
Inflation compounds. You know this, everyone reading knows this, the media does not know this.
Society constantly forgetting or ignoring thresholds exist in everything and are connected only noticeble in the extremes...to the unprepared.....historic cycles exist...for many reasons....the largest society's mindset
Hey John, what's your prediction for a perfect time to buy a house? 2025 or 2026?
Early last year he said late 2023, early 2024. This year it's late 2024, early 2025. Want to take a guess what he is going to say next year? A year ago, almost to the day he was saying that prices would be $540,000 by this time. Well, they are $700,000 today, exactly where they were last year.
@@johnnylongstocking183Only because of government involvement. Without that the market would have done exactly what he said.
@@markz1013 what government involvement was that?
@@johnnylongstocking183 First of all they created a perfect environment for money laundering and fraudulent lending. Then when shit hit the fan with interest rates they allowed and told the banks to save everyone that was overextended. We won't even start with the manipulated stats coming out of statscan. This is far from a free market.
2025 should see some good opportunities, maybe even the end of this year. 2026 should also be really good
I think people need to look at part of the chart that shows 1990 - 2001. The market took over 10 years to recover ... and that's not factoring in general inflation over that period. Yes, over the "long term" prices go up, but how long term is long term?
I got caught in that. See my earlier post. It was a huge mistake on my part. Fortunately I was young enough that I was able to recover somewhat.
@@althunder4269 would it still be a mistake if you sold in 2017 instead of back in 2007?
@@elai3147 The price run up from 2007 to 17 would have helped but It probably would still have been better if I'd just put my money into an S&P index fund because I'd have had that extra 15 years of growth. But I can't say for sure because I've never run the numbers. Selling in 2007 was also a lifestyle choice because I was tired of living in that house. I just got caught up in the real estate mania like everyone else did at that time. I also got ripped off when I bought the place but that's a whole other issue. I live and learn and move on but the whole thing did sour me on real estate.
True. But … have you looked at the S&P chart after the internet crash. Took a long, long time to recover. So … not necessarily better than real estate.
Bigger the bubble, longer the term imo
Who is buying homes when people can't find jobs. The economy is not strong, so if you aint a doctor, lawyer, teacher, or in any job that's not recession proof, why do that to yourself.
People in the market and speculators.
In the growth by asset class chart you missed talking about leverage. One of the factors with real estate is people have access to very easy loans to cover their costs. I purchased my first condo with 0% down in 2007 though now a minimum of 5% is required and of course CMHC fees apply if paying less than 20%. So the actual return is based on the buying and selling costs (including CMHC fees if applicable and closing costs), the mortgage interest paid and how much money was ever put into the mortgage. Effectively real estate gives buyers an ability to over leverage themselves in ways that would be harder to do if they bought stocks and bonds. We took a boring safe low return investment class and turned it into a high risk high reward investment class then hit the affordability ceiling turning it into a high risk low reward investment class.
Yes, great point, thanks for sharing
We bought a house for the first time this year and got 5.01. Now we are stuck with that rate for the next 4 years as we watch rates go down. Really sucks.
Double whammy if prices come down.
It is better to have a house and get equity rather than pay rent and give equity to a landlord.
The only time renting makes sense is if you are not planning on staying where you are.
Enjoy your house. Your rate is historically about normal, your house price might come down but who cares if you don’t sell. Keep some dry powder, enjoy life as a homeowner. If you do it right, in 20-25 years you’ll have no mortgage. In 5 years you get another shot at rates.
we are at 5.7 haha sucks but all we have to do is to just work/eat/sleep for the next 5 years. No movies/restaurants/etc NO EXTRA SPENDING until we can lock in again at a lower rate.
@@AnnoyinglyCharming I'm surprised you can't refinance at a lower rate like if it drops to 3%
People who bought near the peak, paid down their mortgage instead of paying rent. Could you include a line to your graph with estimated net asset value including paying down the capital? I'm sure it would be a lot of work, but it would be interesting.
I'm not saying that buying at the peak is ok - I did it in 1990 - It wasn't ok! But you have to live somewhere, and you either pay a mortgage, or you pay rent.
Another "Like" for Jon Flynn. Have to agree, many sellers think it's Jan/Feb 2022 with their listing prices. Don't believe the hype spewed by real estate pumpers. Why would you buy an overpriced house at current interest rates when approx. 80% of your mortgage payment is interest? No thanks, the bubble will burst.
Crazily high prices (of pre-COVID) went thru the roof during COVID mainly because the interest rates went to basically zero. Then, interest rates went up and prices remained the same (more or less). Now, everyone is waiting for interest rates to drop so that prices can continue go up.
Crazy! Shows how disconnected we are from the reality and how deeply in a bubble we are. More like a national mindset bubble ... built over years and years of speculative real estate supported directly and directly by various gov policies.
But we cant live by our own rules and the bubble will eventually burst.
John Flynn for next housing minister
This time there has been no significant job loss. Eonomy seems to be holding good. Thats why sellers are. Ot desperate.
Our unemployment rate is over 6% and it hasn’t even begun yet.
there was a time when a house was a home and not a stock option
And the hard working class were not
TAXED TO DEATH.
Yup. And real estate agents were complicit in persuading people that real estate should be an investment rather than a place to live.
More speculative than a stock option.
It's not even prices going up that makes you all your money it is part of the money you would have put towards rent that goes towards equity in the house.
I would be paying $1350 in rent a month or $1350 a mortgage and risk having to do maintenance. In 5 years my $1350 rent would be $1800. On the $1350 $700 of the dollars goes towards interest, and $650 goes towards the principal. Which means I now have $39,000 rather than have paid rent.
If rent was $700 your math makes sense but the landlords are getting you to cover the whole mortage not the interest.
When you buy a home, you have closing costs, transfer taxes, yearly property tax, maintenance/repairs, financing costs. It's a better financial decision to rent when we are at the top of the cycle.
@DJRS2178 I still rather have the 650 a month even with all of those things.
Landlords can only get rent on what the market will bear. Many are not covering the whole mortgage and they are underwater.
@althunder4269 corporations are also buying houses. We don't have enough houses, and house prices didn't get the increase with the inflation because of the interest rates. Once interest rates go down you will see them skyrocket.
$.70 5 years ago is $1 today.
More buyers and lack of supply, and this guy thinks the price is going to go down when interest rates drop.
@@James-tk9oy There's not much of that happening in Canada it's occurring more in the US. We don't have a housing shortage in Canada, we have a housing affordability issue here. House prices decline when interest rates decline because that's when we are in a recession. Unemployed people don't buy houses.
The dollar has devalued so much that 30k interest makes some sense. With inclines stagnating it's an issue. Please do a video on home builder profit margins.
Thanks for the continuous update! I am super excited about how my stock investment is going so far, making over $32k weekly is an amazing gain.
Do you invest with a professional broker??I'd appreciate it if you show me how to go about it.
It's Elizabeth Regina Nelsen doing she's changed my life. A BROKER- like her is what you need.
Her top notch guidance and expertise on digital market changed the game for me.
YES!!! that's exactly her name (Mrs Elizabeth Regina Nelsen) so many people have recommended highly about her and I'm just starting with her from Brisbane Australia🇦🇺
Wow! Kind of in shock you mentioned expert, Elizabeth R Nelsen. What a coincidence!!
If buyers can hold off until spring 2025, you will have listings built up and price declines from winter, coupled with the announcement of the primary residence gains tax in the 2025 budget.
Hold some asset like gold right now
Cash still has a chance of inflating
And between the push against temporary workers and AI, fewer people have the salaries to justify these prices
These condos are going to probably turn into affordable housing lol, as a way to buyout bankrupt developers and solve the homelessness crisis
Finally you bought a condo...just coud'nt resist right?
It’s a green screen lol
@@dramachic22 Lol I know! Said that with all the pun intended
To late I'm a debt slave stuck with a 5.3 percent interest rate fot the next 3 years
Nice charts but not inclusive. Housing costs are typically leveraged by way of mortgages. Also, alternative to owning is rent. This is not at all reflective in your numbers. You are simply comparing 2 assets, initial investment is cash purchase and then return. I suggest you do a more complete comparison including all alternative costs such as rent.
He also does not factor in leverage in his charts. Yes, the S&P beats real estate. But you aren’t leveraging your S&P investment with 20% down 😂
Believe it or not, after 3-4 months of listings being revised down, i am starting to see house prices being revised UP in the Outaouais. I don't get it. It is really owners directing their agents to raise the price or it is greedy agents trying to upswing the prices on us again?
Wait until all the job losses. There's going to be people with no cash, because it's all gone into the house, facing 5K plus mortgage payments while living off UI if they're lucky Thank your incompetent government.
I think Ottawa may be doing very well - the sales seem to be picking up ...
I agree, and it's not coming down at all in the atlantics where the wages are much lower. it's completely insane.
New Brunswick here. Our housing market is still crazy. Housing prices last November - February looked like they would settle down but now they’re on fire again. Two houses in my neighbourhood sold well above asking within days.
One was a 3 bed, 1 bath, no garage, no basement that sold for $400k, which was $100k above the asking price. Another small house was listed for $250k and sold almost instantly after a bidding war.
@@howzertech2222 That's insane. I make good money for New Brunswick as a software developer, well above median for this province, and I can't afford any housing, and I'm stuck where I am in my 2 bedroom apartment because the landlord has been gracious and it's currently at 868$ a month while my neighbour pays 1400$ for the same thing. Most of my friends have to return to living with their parents in their 30s. It's nuts. I'm lucky I can even live independently. I think we're gonna end up like Argantina.
@@D4rkBl4desounds about right, I'll be moving into a one bedroom plus den for $1645 in September.
@howzertech2222 the parasites have invaded lower cost zip codes. Just don't buy at their asking prices.
John, Real Estate is the only asset class in that graph that is leveraged, so you would need to account for that. If I put 20% down I still wouldn’t beat the S&P but I sure as hell would do well. Plus I’d be paying the loan back in inflation devalued dollars. It’s like it’s a contest of the pumpers vs the dumpers on the interweb.
THIS. This is the major thing left out of his videos.
Can't by what we can't afford ....the way of the world since 2004.....living luxuriously on credit.....doesn't last long and is a long climb out...still from the 2007 world financial crash
Pinocchio?
Jon completely leaving out the chart from the crea stats showing every province having price increases except for BC and Ontario. Why did you leave that one out Jon? Doesn't fit your market is crashing narrative hey.
This guy will make a lot of young people a chance of getting their first homes..
@@vancouverlife1040 he isn't going to be helping any buyers because he keeps telling everyone not to buy.
@@johnnylongstocking183
Well, unless one just LOVES enslaving himself in a crushing debt, what is wrong with the advice: "refrain from buying at this point in time"? The prices are simply out of touch, with the economy not doing so great. Why would anyone with a logical reasoning expose himself to such an imminent risk that can EASILY ruin that person? Common sense? Math? Risk analysis? Anyone?
Whether the market will crash or not, is another thing.
@@Nemija or you just buy within your means, That is a good way to not enslave yourself with crushing debt as you say.
@@johnnylongstocking183
Yes, that makes sense in an average market, with a solid economy. But, in this case, the big issue is that not more than perhaps 1-2% of all people can buy anything within say GTA. It's not within anyone's means. That's why the situation we're having today is unheard of. It all just screams: "unsustainable".
It gets even worse if you want to buy something 300-400km away from Toronto, since the prices are still way too high, with the salaries even way lower than in GTA. So, a combustible situation we're having here.
Im no expert, but Canada's National debt is at the highest Level ever, higher than WWII era, Might be more going on here than high house prices and inflation. Might be nothing also🤔
PRICES DROPPED 80% IN 1930. That is coming again. Every century has DEFLATION as well as inflation.
Imagine paying on a $1M mortgage and watch the neighbor buy in for $500k for the same property. 😢
@@mr2_mike Fantastic for the 500k buyer. No tears for the 1M buyer.
Condo market in York Region has barely changed! When are these prices going to start dropping??? Come on now.
It'd be nice to see the chart in inflation-adjusted numbers as well. Due to inflation if you bought a property in Canada in 1990 for ~250k, in real terms you'd have to sell for over $300k in 2000 just to break even in real terms, not accounting for fees/taxes/interest etc. It looks like the break-even in real terms wasn't until around 2005 aka. approximately 15 years later when the bubble started to reinflate.
Amen
Anyone can literally walk away from their mortgage at any point.
Not in Canada.
We have recourse mortgages that requires personal bankruptcy.
In the US they can walk away.
Will see it happen more and more in the next couple of years
Comparing the 80ies and now with mass immigration is not a good metric... with Canada wanting 100 millions in 2100... real estate should go up slowly over years , it's simple math
You act like the SUPPLY side of supply and demand doesn’t exist. They can always over build.
@@matta7215100%, new technologies in home building like 3D printed homes that accelerate new home stock will devastate home prices.
Baby boomers dying off, only so many replacement ppl you can get to come over especially considering Canada isn’t a great country for many new immigrants.
What if we added 50,000 new home builds per year? Not a crazy number, 50k more homes built per year and prices start tanking.
Lol still too high yes in the following places Niagara falls, cambridge etc
Too funny the prices will not be coming down to what they want 50%
Omg ok how about a rent slave. Joke advise
Thanks Jon. I don't love your politics but I do love your content.
Any idea when will affordability return ? Can you also make one video on Condo Maintenance fee ? It’s just too high even if the price of the condo is in affordable range
The whole doubling thing never considered inflation.
Hi Jon, how do you factor in build costs? I wonder if your frame of reference is your area. Some places in Canada it may still be wiser to buy. As well, the overall quality of life bonus of having a house still stands.
In central Edmonton, all the houses with "Sold" signs are sub 500k tear-downs; all the houses for sale and not selling are 700k plus newer builds. So I'm guessing that it's mostly developers/investors looking for properties to build huge new houses on that most people already can't afford and so aren't buying.
1000 percent agree
So when is the right time?
2025-2027 if we're lucky
@@Gamelesskeep waiting bud 😂
Thank you Jon. I admire your work.
It is not coming down whether you agree or not
Jon left out the crea chart showing every province except BC and Ontario has price increases this year. If it was every province with decreases expect one or two Jon would be jumping out of his chair to show that chart.
It already has come down off of highs.
imagine you have $300k and you want to start a family right now
do you buy a home and go into debt slavery or move to a lower cost of living place, buy bitcoin, and lean on savings?
im gonnna buy a home because i wanna install new carpet guys
Realistically, you do whatever you need to do to triple that amount. Then you have real options. I know that’s not the advice you wanted.
What are the signs of recession?
There are several key indicators that economists watch to determine a recession is occurring or imminent:
Rising Unemployment: A steady increase in job losses and a surge in the unemployment rate are strong signals1.
Decline in Consumer Spending: Since consumer spending drives a significant portion of economic growth, a noticeable drop in spending can indicate a recession2.
Decreased Personal Income: When personal income, adjusted for inflation, starts to fall, it suggests that people have less money to spend, which can slow down the economy2.
High Inflation: Persistent high inflation can erode purchasing power, making it harder for consumers to buy goods and services3.
Negative Yield Curve: This occurs when long-term interest rates fall below short-term rates, often seen as a predictor of economic downturns3.
These indicators, among others, help economists and policymakers assess the health of the economy and predict potential recessions.
We’ve been in a recession for awhile in real terms but temp foreign worker + student visa program (rapid population growth) has masked the true state of our zero growth economy. UK in similar situation imo.
Thank you Jon!
I would agree with your headline.. been saying it for the last ten yrs after seeing the devastion in arizona
Sir what if the market don't go down
Exactly. I mean … he MIGHT be right. But I remember people saying the same thing for over 15 years now. They were wrong.
Market has already gone down off highs.
Majority of Homeowners have more equity vs renters in retirement. So owning a home is good
What about all those, 70 80 90 year amortization schedules now. Your living in the past.
Home equity tax will change the game, coming in 2025
@@TheTruth-cg8vj it’s coming back to normal with rates going down
House price will go up as cost of building them is still much higher with inflationary cost now and future.Unless there are significant change in housing reforms the situation will be like this in major cities like Toronto, Montreal , Calgary and Vacouver
Oh gee hrrrm guess I'll just continue paying rent that's twice as much and be stuck in a lease instead of buying.
If you pay $3000 a month rent for the next year that will be $36000. House prices will be down by far more than $36000 in one years time so you will still be ahead.
As the rate decreases, the prices will increase.
Not true so far. We’ve had two cuts and the housing market is…meh.
@@markb8360 every province in Canada except Ontario and BC has rising prices. Jon left that chart out of this video. It's on the crea stats package Jon is talking about in this video.
When a bank makes a loan, something like 90% of it is made out of thin air. It can only absorb so many bad loans before it becomes insolvent. Right now in Canada you can see the "we don't believe you're solvent opinion" appearing in the overnight lending market between the big banks with the feds forced to step in as the lender of last resort.
Wow this is a great video … been following you from California Bay Area for a while
so you are saying that Nick Murray is a dumbass lol: Timing the market is a fools game, whereas time in the market is your greartest natural advantage. - Nick Murray
I don't think he has much time left to time that market. He's in the financial services and has a hidden agenda of getting new investors in.
You are absolutely correct. Honestly the only advantage to buying real estate right now is leverage. It’s tough to get the bank to loan you 4x your annual income paid over 30 year to invest in the S&P. Anyone could buy their principal residence, rent it out and only spend 700 days over the next 5 years in Canada keeping their residency and then sell. Regardless of increase, the tax free equity alone is worth it.
So you don’t think it’s a good idea to buy a house cash up with no debt, if you can afford it?
‘Tax free’ , that’s changing in the 2025 budget
@@musicbygoldenjunlikely
Why would one lose money after 10y or 15y of renting purchased property?
Nobody buys investment property and just locks it up for years.
One can lose money by trying to quickly flip it.
I actually know of a few properties that are sitting empty, locked up for many years.
Mostly Chinese from Hong Kong that bought in the late 80s early 90s. They no longer live in Canada. But the house sits.
@@mr2_mike Any reasonable investor tries to maximize profit. Renting an investment property is a no-brainer.
IMHO buying and locking up investment property for years is a sure indicator of some shady business
We’re watching houses drop in a BIG way on Vancouver Island. $100 000 k drops. Looking at what they paid in 2022 we can already see they’re listing 100k less than they paid.
Everyone listing at crazy $’s and watching them drop 100 000 k within 4-6 weeks. It’s incredible.
We were going to buy but no way. Waiting now!!
Thank you Jon,
Great video! Very informative!! 👍
Thanks for this video. This cleared lots of doubts in my mind. I have done similar calculations and completely agree with you. I hope you will put more informative videos and give a clear idea in the future when to enter the market.
Poilievre recently commented he doesn't believe the Canadian RE market is in a bubble. He contends there is underlying demand to support the current prices. I think he might be right given the high cost of permits, taxes, materials and labour and the massive increase in population over the past 5 years. In your opinion, is there any merit to what he's saying?
He’s completely wrong. Why is inventory through the roof but nobody can sell? Rates are dropping, where is all this demand?
I dont expect anything diff from Poilievre. Few minor differences (climate change, less virtue signaling and less identity politics) but when it comes to real estate and maybe even mass immigration ... he may be just JT-light.
The only real diff would be Maxime Bernier - but I cant see him getting anywhere with our far-left media landscape.
Its not worth it! ❤