COVID and the housing market

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I have zero sympathy for business people and speculators who purchased cottage property(ies) during the peak covid craziness a few years ago.

We had several cottages on our lake sell for crazy prices and they immediately went on the rental market. Most of these places went on the market about 2 years later when interest rates spiked and and were listed at the purchase price or slightly higher. LOL. Needless to say, they just sat there for unsold while owners who could no long afford to carry a cash negative rental cottage slowly came to the realization that the market had changed.

In one example purchase price was $1.6M, originally listed for $1.7M, sold for $1.3M. With real estate commission this is a loss of about of $400K.

IMO, given the state of the economy, trade discussions, reduction of discretionary purchases, general uncertainty etc..... we probably have not seen the bottom of cottage prices. If it was me I'd get the place assessed and sit down with an accountant to determine the capital gains taxes you have to pay now. Who knows where capital gains taxes are going to go in the future. The inclusion rate is unchanged at 50%, but this might change for the worse in a future where a government are looking for more revenue. It might make sense to sell now vs. waiting for further price drops.
 
nobbie48 said:
The ad says listed for seven months and there are or used to be agents that advertised they'd buy your house. That might be subject to you buying a new one through them. They are also going to pay well below market value and still take the commission.
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And when I have seen those follow through, they seem to be almost exclusively assignment sales. I promise to buy your house, you accept, clause gets triggered, I sign an assignment contract with you for 900k, I sell your house to a random for 1M. Sure your house sold, I even bought it as advertised if you are willing to stretch the definition but you got hammered and I made $150k.
 
mimico_polak said:
Seeing more of these around popping up on my feed and Reddit...wonder how real they are...

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I heard the other day an extended family member has been trying to sell her approx 2 year old townhouse in Paris for 6 or 7 months now....her fiance is also trying to sell his condo in downtown Hamilton for the same amount of time as their plan was to sell both and buy 1 for them both to live...crickets. The guys brother is also a pretty well known name realtor in Hamilton/Burlington Oakville area who usually prices properties pretty high so I'm sure they've had a bunch of price drops by now.
 
Mikedezo44 said:
I heard the other day an extended family member has been trying to sell her approx 2 year old townhouse in Paris for 6 or 7 months now....her fiance is also trying to sell his condo in downtown Hamilton for the same amount of time as their plan was to sell both and buy 1 for them both to live...crickets. The guys brother is also a pretty well known name realtor in Hamilton/Burlington Oakville area who usually prices properties pretty high so I'm sure they've had a bunch of price drops by now.
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In our neighbourhood we've had....4 properties for sale for an extended period...with minimal price drops for any of them (if at all).

One house (flipper) has been on the market for over 1.5 years.
Another house - 2 years (2.3M -> 1.7M over the 2 years once they saw our friends list a similar place 3 doors over for 300k less)
Third house - market for 6-8 months
Fourth house - market for 8+ months
 
GreyGhost said:
Not surprising. I wonder how much that charade cost us? I wonder if they tried to get photos in front of a real construction site and were repeatedly told to go the hell or if they just wrote a cheque to a buddy to provide the sets for the great leader to extoll his excellence.
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And again.. Carney and his band of merry morons = sneaky lying f*cks. What`s it going to take for Canadians to cut these useless tools loose?
 
Glenn/RZ500 said:
And again.. Carney and his band of merry morons = sneaky lying f*cks. What`s it going to take for Canadians to cut these useless tools loose?
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A competent and likeable conservative leader could have won the last few elections. The conservative party needs to find a decent leader ASAP or they will continue to snatch defeat from the jaws of victory.

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Scuba Steve said:
A competent and likeable conservative leader could have won the last few elections. The conservative party needs to find a decent leader ASAP or they will continue to snatch defeat from the jaws of victory.

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They also need to act like a party with unified goals. They have a few loose cannons barely being kept in check.

The Liberals seem to have the unified goal, lining their own pockets.
 
I’m out in Canmore AB house shopping, it’s from four hundred k to four million. Not committed to here but Banff and Jasper are non starters . We have a couple days left to look outside town but winters suck in a rural setting.


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crankcall said:
I’m out in Canmore AB house shopping, it’s from four hundred k to four million. Not committed to here but Banff and Jasper are non starters . We have a couple days left to look outside town but winters suck in a rural setting.


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Some friends picked up a vacation property in nw canmore. Based on what I have seen, the house would have been cheaper with a Toronto address. Great views though.
 
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raginduck said:
ca.finance.yahoo.com

Ontario housing construction collapse 'should alarm policymakers,' report warns

Economists and researchers have suggested that various building targets that would help address the supply crisis are likely unattainable.
ca.finance.yahoo.com ca.finance.yahoo.com
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Anyone paying attention on the contracting side has known this for months if not close to a year. I know of excavation contractors, the first on the ground for any high-rise development, who have moved their businesses almost entirely over to things like sewer installation because the development work has all but entirely dried up. There are still projects in the process of being finished, but not much is getting started, and not much is even in the permitting and financing phase.

Turns out supply isn't such an issue when the open door immigration policy is dialled back somewhat (combined with a minor exodus, as the economic opportunities have turned out to be not so great), added to extra old stock supply as folks mortgage out of homes they can't afford with rates in the mid fours. I also saw a larger apartment building in Hamilton advertising both one- and two-bedroom apartments for rent, something I haven't seen for the better part of a decade.

Southern Ontario has seen unprecedented development pretty much non-stop for 15-20 years now, it's totally natural for things to slow down for a while. What will be interesting to watch is whether home prices continue rising with the Covid insanity removed as a momentary hump in the curve, or if they drop further. Anecdotally, houses around us in Hamilton have stayed pretty steady over the past six months, still selling well above pre-pandemic pricing. They take a lot longer to sell than they used to, but they are still moving.

More worrying will be the economic effect of job losses in the construction sector. A lot of people have been making a lot of money over the past 15 years in the trades, and wages have risen well beyond even the craziest inflation. This will naturally have to reset, but there will also be a lot of folks who will be hunting for work as the slowdown filters through.
 
Priller said:
Anyone paying attention on the contracting side has known this for months if not close to a year. I know of excavation contractors, the first on the ground for any high-rise development, who have moved their businesses almost entirely over to things like sewer installation because the development work has all but entirely dried up. There are still projects in the process of being finished, but not much is getting started, and not much is even in the permitting and financing phase.

Turns out supply isn't such an issue when the open door immigration policy is dialled back somewhat (combined with a minor exodus, as the economic opportunities have turned out to be not so great), added to extra old stock supply as folks mortgage out of homes they can't afford with rates in the mid fours. I also saw a larger apartment building in Hamilton advertising both one- and two-bedroom apartments for rent, something I haven't seen for the better part of a decade.

Southern Ontario has seen unprecedented development pretty much non-stop for 15-20 years now, it's totally natural for things to slow down for a while. What will be interesting to watch is whether home prices continue rising with the Covid insanity removed as a momentary hump in the curve, or if they drop further. Anecdotally, houses around us in Hamilton have stayed pretty steady over the past six months, still selling well above pre-pandemic pricing. They take a lot longer to sell than they used to, but they are still moving.

More worrying will be the economic effect of job losses in the construction sector. A lot of people have been making a lot of money over the past 15 years in the trades, and wages have risen well beyond even the craziest inflation. This will naturally have to reset, but there will also be a lot of folks who will be hunting for work as the slowdown filters through.
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I ran into a guy I knew a guy from a chemical plant in Mississauga and that plant had been giving production worker so much overtime for so long that their T-4s qualified them for McMansions. Then the American owner went full austerity, stopped the overtime and eventually closed the plant.

I ran into him working as a janitor at a different facility. His house and marriage were history.

There may be a glut of chuffed pickups and toys for sale down the road. Hopefully they will have some equity in them. Leased stuff is tricky if there is a closing calculation based on residual value at the end of the lease. I know at least one person that got hit because his vehicle had lost demand during the lease.

The sectors of construction I was involved in came late in the project so we didn't get hit until later and didn't recover until later.
 
A developer in Oakville has kicked the market down the stairs by 40% by having a fire sale on unsold units while people that commited pre build are stuck with their original 100% deal.

Some inked deals years ago for, say a million dollars, and now that it's time to finalize at higher rates that might not fly at the bank, the same unit across the hall is now available for $600,000.

Of course it also resets the prices of anything in the area, possibly province.

 
nobbie48 said:
A developer in Oakville has kicked the market down the stairs by 40% by having a fire sale on unsold units while people that commited pre build are stuck with their original 100% deal.

Some inked deals years ago for, say a million dollars, and now that it's time to finalize at higher rates that might not fly at the bank, the same unit across the hall is now available for $600,000.

Of course it also resets the prices of anything in the area, possibly province.

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That has been happening for years. Townhouses outside Barrie were selling for 1.3M at the peak (absolute insanity). A few years later, builders were selling the new ones for 850 or so (still insane imo). Watching listings come up in that subdivision it is very clear that many of the buyers were "investors" (cough, speculators) as multiple properties get listed at insane prices, don't sell and then get delisted all on the same days with the same realtor. Multiply that drop by two, three or four properties and you could get wiped out. No more bragging to your friends about what a genius real estate investor you are. People that bought multiples probably have some assets for builders to go after if they fail to close. I have no problem with speculators taking an ass-kicking (even if it goes all the way to bankruptcy). I do feel a little bad for people that wanted a place to live and got swept away by fomo.
 
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GreyGhost said:
That has been happening for years. Townhouses outside Barrie were selling for 1.3M at the peak (absolute insanity). A few years later, builders were selling the new ones for 850 or so (still insane imo). Watching listings come up in that subdivision it is very clear that many of the buyers were "investors" (cough, speculators) as multiple properties get listed at insane prices, don't sell and then get delisted all on the same days with the same realtor. Multiply that drop by two, three or four properties and you could get wiped out. No more bragging to your friends about what a genius real estate investor you are. People that bought multiples probably have some assets for builders to go after if they fail to close. I have no problem with speculators taking as ass-kicking. I do feel a little bad for people that wanted a place to live and got swept away by fomo.
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In 2005 I bought a end unit townhouse,2+2, garage and huge back yard onto a greenspace. Paid 179K in the south end of Barrie, off Mapleview W. I sold it three years later, a bit of a quick close based on a work transfer I wanted, got 15 grand over my purchase price. I`ve noticed here in Kawartha Lakes that construction has seriously slowed, towns, semi`s and single homes were asking from about 650 to well over 1M. Still insanity. I look at listings most days, very little activity, any listing that disappears has likely been pulled, once in a while one reappears, the pics have feet of snow on the lawns. 🙃
 
Priller said:
Anyone paying attention on the contracting side has known this for months if not close to a year. I know of excavation contractors, the first on the ground for any high-rise development, who have moved their businesses almost entirely over to things like sewer installation because the development work has all but entirely dried up. There are still projects in the process of being finished, but not much is getting started, and not much is even in the permitting and financing phase.

Turns out supply isn't such an issue when the open door immigration policy is dialled back somewhat (combined with a minor exodus, as the economic opportunities have turned out to be not so great), added to extra old stock supply as folks mortgage out of homes they can't afford with rates in the mid fours. I also saw a larger apartment building in Hamilton advertising both one- and two-bedroom apartments for rent, something I haven't seen for the better part of a decade.

Southern Ontario has seen unprecedented development pretty much non-stop for 15-20 years now, it's totally natural for things to slow down for a while. What will be interesting to watch is whether home prices continue rising with the Covid insanity removed as a momentary hump in the curve, or if they drop further. Anecdotally, houses around us in Hamilton have stayed pretty steady over the past six months, still selling well above pre-pandemic pricing. They take a lot longer to sell than they used to, but they are still moving.

More worrying will be the economic effect of job losses in the construction sector. A lot of people have been making a lot of money over the past 15 years in the trades, and wages have risen well beyond even the craziest inflation. This will naturally have to reset, but there will also be a lot of folks who will be hunting for work as the slowdown filters through.
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I bought a house 2 weeks ago. Before I got the one I did.. I tried for 2 others... and got into multiple bid situations for all 3. I wasn't expecting that in this market.
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