Ron the Mortgage Guy will eventually become known as the canary in the coal mine when Canada’s housing market collapses. Unfortunately, he will also be known as the canary no one noticed until it was too late. A recent tweet asks the question: What happens when a whole condo tower cannot close?
Thread reader.
I suspect that the Developers are going to start sliding towards “Rent to Own” type set ups which will lessen the quality of the domiciles so that the builders can be compensated in an easier fashion. The true problem is that the general public is too obtuse to see the connection between inflation (massively increased by forsaking fossil fuels and escalated by government overspending) and how that effects personal finances as well as increased interest rates.
Instead, the gullible public is force fed bogus statistics from governments (and media) stating that things are improving, and fossil fuel is the devil.
Personally, I don’t think the vast majority of the public is astute enough to make these type connections. And, a lot of those who have the intelligence to do so are willing to forsake critical thought for political ideology.
There is a building down the street from me that is a mixture of condos and rental units owned by the development company, who is asking for ridiculous rents. They aren’t taking a rent to own option, even if it would advantage them.
Well we bought a condo in 2017…in Bldg 1 of 6…the last which 60% Complete. All the others sold out prior to occupation.
Not an issue in Calgary.
But we carry a 100k mortgage @1.9 for 2 more yrs…..tis why I decided that maybe I should unretire and go bk to the Oil Sands…which I have done. In a short 3 weeks have paid off near 7500…(penaltied money of course – but I’d rather pay a paltry penalty for extra reduction in said debt). Should be able to whittle it down rather nicely over the next yr while still having some extra coin around that may well be used for Silver doubloons.
Am ever thankful to the God’s for paving my way initially into the trades, then on to a College Diploma in Engineering culminating to where I am now as a Senior QC/QA Inspector….
Beats the snot outa being a highly university educated batista.
Perhaps those in Toronto who are unable to qualify for a mortgage at a higher rate could simply lower their asking until they meet that sweet spot at which they’ll unload.
I don’t like the term “learn to code”, perhaps they could carry some pipe into the building for me while I show them the finer intricacies of learning to thread it. No, we don’t pay extra because they’ve got a degree in whatever.
Missing from his discussion is that a lot of them were less than 20% down, which means additional paperwork, and additional steps before a mortgage can get approved.
Add to that, when some of these units are appraised, they no longer are worth what they were originally valued at when they were priced and bought 4 years ago. In markets such as Toronto, you won’t be able to get a mortgage with your 20% down, and more than 100% owing on your unit.
I’ve also seen projects where they aren’t moving forward to sales, even though they have gotten an agreement from the city on development charges, and whatnot.