Someone Explain This So Called Housing Crisis?

[Dogpound2020]

I have literally no idea how mortgages or rates or house payments work. Housing in Canada is crazy pricey right now. I thought everything would be at a fixed rate and can only be increased annually to a certain percent? Is it like this all over?

My cousin has a bad gambling problem and she spent all of her money on that, and giving money to help out her kids and grandkids. Then She ended up having to live in a trailer after money ran out. Even places like Hamilton, Ontario which imo IS pretty shitty is crazy pricey it seems. What gives?

 

[Pliny Pete]

China and Wall Street are buying up entire blocks by the bulk which is making it impossible for regular people to afford a house anymore

 

[Dogpound2020]

China and Wall Street are buying up entire blocks by the bulk which is making it impossible for regular people to afford a house anymore

That makes so much sense, I live in Toronto and these huge plots of land are being worked over like crazy, wiping out entire businesses for condos to be built there. This has been going on since around 2018 so post pandemic.

 

[Only Here for Attachments]

According to my friends that still live in Canada, it's all immigrants' fault.

 

[Kowboy On Sherdog]

Prices are going up because people want to live in a house and not on the streets

 

[Pliny Pete]

Prices are going up because people want to live in a house and not on the streets

 

[nostradumbass]

Housing prices go up when the numbers of buyers increases faster than the number of houses, as well as inflation. Canada has a crazy proportion of immigration compared to their population. It's averaging like 600,000 immigrants coming in each year, but only 200,000 houses built each year. Plus there are not only a lot of Chinese immigrants buying houses, but also Chinese investors buying them, as well as domestic investors. They're banking on people moving in at a faster rate than houses are built, thereby increasing the value of their investment.

One-Third Of Vancouver's Real Estate Market Is Owned By Chinese Buyers

Chinese homebuyers accounted for nearly one-third of Vancouver's real estate market during 2015, according to a new report by the National Bank of Canada.

www.fortunebuilders.com

 

[TestosterOWN]

I live in Vegas and some company legit bought 100 houses in a week recently. And they outbid families. It shouldn’t be allowed. If it’s allowed across the country then many if not most people in their early 20s to 30s will never own a house.

 

[Mesos]

I have literally no idea how mortgages or rates or house payments work. Housing in Canada is crazy pricey right now. I thought everything would be at a fixed rate and can only be increased annually to a certain percent? Is it like this all over?

My cousin has a bad gambling problem and she spent all of her money on that, and giving money to help out her kids and grandkids. Then She ended up having to live in a trailer after money ran out. Even places like Hamilton, Ontario which imo IS pretty shitty is crazy pricey it seems. What gives?

Modern societies are seeing their spread out populations move away from small to mid size cities into larger cities in droves. Which is crowding things up and houses(apartments especially) are seeing their values/rents skyrocket. Which is pricing out everyone. Then you got companies and others slick movers seeing these values rising so their snatching everything up. Which further worsens the problem.

 

[Rob Battisti]

Prices are going up because people want to live in a house and not on the streets

The solution is to move this to the WR and hear how living in people’s backyards in shacks is the answer

 

[Kowboy On Sherdog]

The solution is to move this to the WR and hear how living in people’s backyards in shacks is the answer

Or just move to the Deep South

 

[avenue94]

When demand exceeds supply, prices rise. Most of the limits on supply are artificial and meant to benefit existing homeowners at the expense of new ones.

Immigration is way down the list of reasons houses are expensive.

 

[Protectandserve]

So glad I got into my house prior to the COVID-19 madness.

No way I could afford my house at the current rates, even under the old prices. Combine the 2, high rates and massive price increases and there is less than zero chance I can buy.

That said I’m absolutely stuck in my house for the next 10 plus years until my kid is 18 and I can bounce out of state.

 

[Fedorgasm]

China and Wall Street are buying up entire blocks by the bulk which is making it impossible for regular people to afford a house anymore

Yup that's probably the biggest problem. There are other factors but really they need to put a limit on the number of houses you can own for investment purposes.

Big corporations wouldn't bother if they were only allowed to own 30 houses.

 

[Ballsaque]

I have literally no idea how mortgages or rates or house payments work. Housing in Canada is crazy pricey right now. I thought everything would be at a fixed rate and can only be increased annually to a certain percent? Is it like this all over?

My cousin has a bad gambling problem and she spent all of her money on that, and giving money to help out her kids and grandkids. Then She ended up having to live in a trailer after money ran out. Even places like Hamilton, Ontario which imo IS pretty shitty is crazy pricey it seems. What gives?

A range of macroeconomic and environmental factors, but mainly inflation, supply and demand and interest rates is to blame for the current situation. Influx of new people to the state is a factor in this also. Large cooperations being able to purchase commercial real estate is a large factor as well, but that ties into supply demand dynamics.

 

[ipowerslapmywife]

When demand exceeds supply, prices rise. Most of the limits on supply are artificial and meant to benefit existing homeowners at the expense of new ones.

Immigration is way down the list of reasons houses are expensive.

Well immigrants move here and need a home sooo

 

[Halifax]

According to my friends that still live in Canada, it's all immigrants' fault.

When demand exceeds supply, prices rise. Most of the limits on supply are artificial and meant to benefit existing homeowners at the expense of new ones.

Immigration is way down the list of reasons houses are expensive.

Not really. Its a huge factor. Bringing more people in en masse without infrastructure to support the newcomers = crisis

in our case, its both healthcare and housing.

Take my province for example. Vacancy on apartments and houses are near 0%. houses that go on the market are scooped up near instantly, many without even a viewing of the house. Some are stuck in their apartment because they have no options to go anywhere else. Which is why landlords are now only doing fixed term leases so they can evict and raise the price a year down the road(Rent has gone up 100% in the last 4 years. A 2 Bedroom that cost $1400 in 2019 is now $2400). They can raise the price because housing starts per year is 7100 or so and immigration is near 13000 + 14300 non permanent international students who then get work permits to become permanent citizens.

When you are only making 7100 new units a year in a zero vacancy province and bringing in 27000 newcomers a year, it doesn't take a rocket scientist to know supply and demand is going to get more out of whack. A lot of them are willing to pool together and live 8 people to a 2 bedroom.

 

[STRYDG]

According to my friends that still live in Canada, it's all immigrants' fault.

I don't know Canada but that could be true, its true where I Iive. They let too many people in and infrustrature and new housing cant sustain it. People start bidding wars over housing them all of a sudden house values double over a few years and fuck everything up.

 

[Jack Reacheround]

China and Wall Street are buying up entire blocks by the bulk which is making it impossible for regular people to afford a house anymore

Nailed it.
Also, developers no longer want to build starter homes - small homes with one or two bedrooms that are affordable for those who have never before bought a home. They only want to build McMansions now.

As for how mortgages work, they work exactly like a loan. Because that’s what they are.

Say your house costs $400k, and you have saved maybe $20k for a down payment. A bank loans you $380k and you spend 30 years paying it back month by month.

However, because of the hedge funds, Chinese investors, and even universities piling all their money to buy up all the residential property they can, regular people don’t even have enough money to afford a house with a loan.

Also, sellers always prefer cash. And investors, like Wall Street, always pay cash. Even if you could match their price, you would lose the bid because they pay cash.

 

[wildchild88]

How about reading articles from experts if you're actually curious to learn.

Most of the replies in the thread are just heresay opinions and bro science.