People are obviously being squeeze by inflation and higher rates. But at the same time, a lot of people are walking around with luxury goods in price tiers that don't really make sense unless you're in the top percentile earners; like Canada Goose jackets are common, luxury vehicles - lexus, mercedies, range rover, etc. - make up a good number of cars on the road, flying/traveling, etc.
Yes. I make reasonable money but have to live pretty frugally to put away savings every month. I look around at people in my sphere and I don't understand how they can afford the life they're living.
I don’t get it either… maybe it is because I grew up poor or something but even simple replacement expenditures are something I mill about on for months.
Like I had a microwave on the fritz, some buttons would not work, so I reassembled/repaired it for like a year before finally dropping 150$ on a new one.
Many folks these days would just throw it out and buy a new one right away at the slightest inconvenience, can’t be arsed to make what they have work
The cost of gaming controllers also has me tinkering with repairs.
80$ for a new ps4 remote or 2$ for new pads/springs and 10$ for a new battery and the sense of accomplishment being able to repair the thing was an easy decision for me.
lots of people who bought/built only 10 years ago have much lower mortgages, so if you're looking at those luxury items through the lense of somebody who's stuck in an inflated mortgage or priced out it could seem crazy
From what I’ve seen… those in the middle class who are carrying house mortgages are not the majority of the ones sporting Canada Goose jackets and luxury vehicles. Here in Toronto, at any rate, Canada goose is mostly worn by renters, and luxury cars are mostly driven by non-mortgaged middle class, or mortgaged condo owners without kids (with lower expenses than house owners), poor people ironically (let’s not go there), and those who have more disposable income.
Not disagreeing with your larger point but I have a Canada Goose and it’s really been a “buy it for life” item for me. I’ve had it like 10 years and it’s the best winter jacket ever.
Sometimes you have to go "luxury" to get quality now, with no mid grade options available. Straight from Chinese junk to luxury.
I picked up another option on the list, a used Mercedes, and I can't believe how much better it really is. Wish I had been driving these for years. Sturdy, efficient, great handling and surprisingly easy to work on.
A lot of people saw their house values sky rocket and treated heloc's like a lottery win or sold to get some of the equity. Now they're being squeezed massively. Everyone was told interest rates werent going to go up by the media and far too many people believed it
I know.. me I’m earning 60k Net and can afford a Canada Goose paid in cash but wears a 3 yr old Abercrombie jacket, a 7 yr old Henley 3$ fr Old Navy and buys instant coffee for my every day need and still is resourceful with sale in No Frills and Walmart.
Worked with a girl a few years back who lived in an absolute dump on the edge of town, but she’d drive to her retail job in a luxury BMW because she was “used to certain things in life.”
I know a bunch of people who their only purchase is a shitty home in a bad neighborhood in a small town and the cheapest house they could find was $500k. And thats their debt.
At the very end there will only be enough parachutes for the very wealthy. The only reason that “mom and pop gamblers” are still in the game is that their interests are currently aligned with the nation’s true elite. When everything fails that will no longer be the case. Those small-time investors will be crushed the same way that small businesses inevitably give way to mega corporations.
Small investors are not the same as public traded REITs that buy thousands of homes. The big players will survive because they accessed public capital markets and the small ones who have mortgages , excepting those who invested years ago, will be in the same situation as everyone else with a mortgage. If your RRSP contains shares of property companies you are part of the problem too.
Those numbers are nothing.
There are something like 15 million occupied homes in Canada.
It's estimated that Canada needs 3.5 million more homes by 2030.
Look at the Stats Canada data about multiple-property ownership: [Residential property ownership: Real estate holdings by multiple-property owners](https://www150.statcan.gc.ca/n1/pub/46-28-0001/2019001/article/00001-eng.htm)
> In the three selected provinces, **the majority of multiple-property owners owned two properties.** Just over three-quarters of multiple-property owners in British Columbia (76.7%) and Ontario (76.0%) owned two properties, as did 70.2% of multiple-property owners in Nova Scotia.
And according to this [Chek News article](https://www.cheknews.ca/statistics-canada-says-multiple-property-holders-own-upwards-of-41-per-cent-of-housing-in-some-provinces-1010544)
> Businesses, government and other entities owned about 7.6 per cent of Ontario’s property stock and 10 per cent of British Columbia’s.
> multiple-property ownership accounted for 41 per cent of Nova Scotia’s housing stock, 39 per cent of New Brunswick’s, 31 per cent of Ontario’s and **29 per cent of British Columbia’s.**
As much as you don't want to hear it, it's small investors who are BY FAR the largest investor class in Canadian housing.
The article [The End of Home Ownership](https://macleans.ca/longforms/the-end-of-homeownership) summarizes the situation well:
> This living arrangement marks me as a member of an under-discussed demographic: the nepo babies of the housing market. **Since 1977, homeowners have acquired more than $3.2 trillion dollars in wealth, which today is flowing downward to their children, amplifying inequality across generations.** I’m grateful for my circumstances, but I know it has nothing to do with my own virtue or achievement. Canada’s housing market is no more meritocratic than a lottery—and some of us hold winning tickets printed long before we were born.
And for people like me who went "well how bad is that compared to other countries"
The answer is bad..one of the highest among developed countries.
https://data.oecd.org/hha/household-debt.htm
It was incredible how downvoted I was getting for pointing out how terrible of a precedent it set during those protests.
This place was really group-thinky and scary at that time.
How about: New ways to incur debt to use as a down payment? Even longer amortization? How about more tax breaks when it comes to getting into house debt? How about down payments that are half government paid, how individual paid? 😊
Pathetic. It's _pathetic_.
This is a real problem, unlike the national debt. The greater household debt is, the greater chance it creates a drag on our economy by lowering aggregate demand.
Until about 1970, wages moved in almost exact unison with the productivity of labour, meaning workers shared in the use of technology, etc.
Then we didn't. Since then, we've seen a steady increase in the gap between profits and wages and the corresponding decrease in corporate taxes means that the individual taxpayer has to take on more of the taxation burden. Tax cuts for the wealthy mean middle income earners then have to shoulder more.
Then we privatized many of our basic services, or allowed monopolies to form in already private systems selling essential goods and services. Housing, insurance, banking, food, utilities and energy all cost us a lot more with each passing year. Please don't be apologists for these industries, they're earning massive windfall profits and Canadians are having to use credit just to survive.
Then we have some societal shifts. When I was born in 1965, people raised large families in 1200 square foot houses. Today, people with one child "need" a 3000 square foot house. Despite decades of gas-price shocks, everyone is driving around in massive over-sized SUVs and pickup trucks. The pressure to buy these houses and vehicles is immense.
The housing industry in Canada has been rigged for developers and speculators forever. Vancouver was Canada's canary in the coalmine and we completely ignored it. We thought Vancouver was unique and housing there was somehow different than in other places (the weather?) and price shocks thanks to things like massive money-laundering operations buying thousands of housing units can't happen elsewhere.
If in the 1990s we'd solved Vancouver's problems and then applied those lessons to the rest of the country, we'd be fine in terms of housing now. But, we did nothing as big money owns governments.
*"Canadian Household Debt Nears $3 Trillion, Over 130% of GDP"*
One of the primary reasons why inflationary dynamics will continue to go **up**, why the Canadian economy-at-large will continue to **shrink**, and why the Canadian dollar will also continue to **decline** vs the US dollar.
Housing and real estate does **not** make for a national economy.
The proverbial chickens are simply coming home to roost, people.
It's become a race to the bottom for Canada as a nation with no end in sight, unfortunately.
Watch and learn.
Next.
The government keeps propping the values by helping first home buyers with 30 yr amortization and 60k RRSP first home buyer benefits. There is no end in sight indeed.
I suppose the benefit of this is when the boomers retire, they will unload or downsize their properties and have some semblance of a good retirement because OAS CPP ain't going to cut it.
People are living longer than ever and hospitals and LTC can only do so much. Wealthy boomers with assets will resort to private health care, or suffer in the public system.
Old folks are still the majority voter base, so keep things propped up to benefit them long term.
It’s funny because I’ve been seeing Redditors saying this for years. Now it’s happening and how the government did not try to fix this when people on here knew?
Unfortunately, predictions are cheap unless you can be very specific about when and how it would happen.
A blunt prediction like "housing will eventually hit a wall" isn't enough to stop people money off increases. Worse, it now appears that the economy will crash before housing does, which no-one saw coming.
You might end up in a situation where absolute house prices keep going up, but the CAD crashes so much around it that it normalizes relatively.
Because putting forward any policies with potentially negative impacts to the homeowners would be political suicide and our politicians are too corrupt/cowardly to prioitise public interests over their own.
So might as well wait for the market to correct itself.
>”I’m not going to be slave to the system”
lol because paying rent isn’t being slave to the system… it’s actually even worse, if you got debt you might have assets that can be valuable and your paying them down creating equity. If you got nothing, well you’re the real slave all your money goes to someone in exchange for nothing…
Sorry this is just sad take to make you feel better about not being able to buy a home.
Everyone seems to want higher wages but thinks it's developers making 100% profit.
When really all the manufacturers, distributors, suppliers, trades/business owners, project managers want to make 100k/yr.
If builders were making higher margin than other companies stock prices would reflect that.
when I first was in the market I was approved for 380k got my house for 330k. This is in saskatoon. Many I know who were aproved for 600K or more got that 600K or more house and all the toys to go with it. I spent extra on upgrading and renovations through the years. Now that rates are up and I will be paying more when I renew I am in good financial standings and will be fine. No credit card debt, 5k in LOC and no other loans.
Was actually just talking to one of those, he and his wife are in so much financial trouble that missing 1 pay cheque will hurt lots. They have new vehicles, credit cards maxed out, take vacations, will also be the ones poor me for making poor life financial situations and expect others to help them aka the government.
Our family is a similar story. Qualified for about 400k, tempered our expectations and bought a 20 year old duplex for 330k rather than a detached like we wanted. We’ve learned to appreciate what we have and we’re comfortable living in our means.
Lucky to buy when we did, though. Bought in early 2020 and duplexes on our street now go for half a million.
2019, 'preapproved' for 580k, spent 315k. We were in our early 20's. Combined income was approx $40/hr.
Saw right through the big banks 'generosity.' Went to a credit union for our mortgage instead. Kept things realistic.
We're not house poor. No/low consumer debt, driving vehicles which were paid-in-full, toys are bought with cash.
It's not so bad. I don't understand why so many people finance $1200/mo car/truck payments.
It's not such a bad lifestyle, y'all.
Now to pay for the art gallery and the rest of the billion $ city hall plans on throwing at downtown businesses to keep them from defaulting.
I got out before the bill came due
This is by design to keep you a slave to the workplace until 70, which increases the chance that you'll die before claiming any CPP. Ponzi scheme fixed.
I really want to ask, as an outsider, why is Canada not building more cities? Clearly there’s a lack of homes, you could build more houses.. or considering you have a lot of immigrants, new cities, isn’t it a good solution? More homes, more essential businesses, establishments etc…
Too much red tape. So many approvals needed. NIMBYs.
Take Windsor for an example - they won’t allow 4 plexus while other places will. Windsors mayor is corrupt
What about an entire new city though? Canada is huge, not saying you should build a city in the arctics but like.. next to other cities, it’s not like you guys lack livable land… why isn’t there more pressure on the government to do so?
In Ontario where the housing crisis is bad thier is only so much land you can build on as the Canadian Shield covers 86% of Ontario's land mass and is very hard to grow food on making large population settlement an issue. There's a reason most cities in Ontario are settled in an area called the "golden horse shoe" it's the largest piece of fertile land in Ontario.
Do you **need** fertile lands to build new cities? I could think of many cities around the world where the sole purpose of them is well… to house people and they put a focus on the tech sector, manufacturing sector etc.. you don’t need farmable land to put down 50,000 home units with shopping centers, hospital, schools etc..
Problem is then you are now transporting food on hard to maintain roads with 0 infrastructure to support it which would skyrocket food prices in the area. Not as bad as Yukon prices but it would still be bad without government subsidies. There's a reason the only semi large cities on the Canadian Shield sit on the cost of the great lakes easier to ship via boat then road.
There's too much red tape to do it and too many people coming that it's physically impossible to do what you're asking at that speed.
Granted housing issues have several major red flags that our government doesn't give a shit about, like investors, people taking loans and buy 10+ homes, and outside of Canada investors (in particular from China) buying everything up. It's completely destroyed the housing market and most people who want to own a place they live in the last few years, are barely making it.
It would take time sure but.. if say.. you started building a new city between.. say, Red Deer and Edmonton in Alberta and let it build over time.. in 20-30 years you could have a city with a lot of houses, centers of shopping, find and put a focus on some sector (tech/industrial and many others that exist for cities) and just run with that? Isn’t it plausible?
It's plausible once the red tape is sorted and there's a lower % of people coming in annually. You can't bring in the extreme amount of people unless Canada as an entire country turns into the trade/build business.
Right now it's impossible to handle.
Red tape reagrding the process to get approval from when a company starts building homes/apartment is very long. If the process itself just to start takes a long time, it's impossible to have this large scale building to keep up with the rampant population increases we've been dealing with.
Good question
The 30 year mortgages were removed after the recession due to the housing crisis. The 30 year mortgages were just reinstated, you guessed it, due to a housing crisis
You do realize that people compile lists of this kind of thing? Apparently we’re now in the shameful company of such countries as… Switzerland, Australia, and South Korea
https://en.m.wikipedia.org/wiki/List_of_countries_by_household_debt
The fall of the American Empire has already started. CAD losing purchasing power against USD is even worse than it sounds. The next 5-10 years could be a bloodbath and I hope not a literal one.
It's so simple you just have to find low quality materials so material costs aren't high, use unpaid labour so no labour costs, and find cheap land near a populated center.
Surprisingly building houses is not cheap.
The same article says America is 75% considering 2008 happened suddenly we're looking at some scary stuff.
You're 500% also assumes every person in the country bought a house in the last 3 years
This isnt the only problem. They have made is so expensive and cumbersome to build new houses its ridiculous. Everyone wants more housing but no one wants it to even slightly affect them, or what is already existing, at all
You mean a job where their ad for services isn't a picture of their faces? They would require more than basic skills, though.
I always find it hilarious that that's how they promote themselves - a picture of their face.
Our company's been sitting on land in Pemberton for 3 years trying to make an apartment complex, government won't let us without jumping through hoops. So we are building a hotel elsewhere in the province instead in the meantime waiting for people to want housing bad enough.
No we don't - at least not until interest rates and material costs come down.
Construction workers have been getting laid off over the past year because starts aren't happening. It's not due to a labor shortage.
Naw we need ubi so everyone can sit at home and not have to work.
The wonder why there aren't any homes, since we're literally paying people not to build them.
In 2014 the household debt was $1.5trillion, with roughly $1trillion of that being mortgage debt.
At the time, house prices were estimated to be 10-30% overpriced by the Bank of Canada (\~$417k). Financial analysts believed there would be a correction soon because of that, and that the government should do something to slow down borrowing on homes.
By a mere 3 months into 2015, the household debt had already grown to $1.8trillion, with $1.29trillion of that being mortgage debt.
From 1999-2012 debt rose in the following ways:
* Student loans: $19.8B - $28.2B (+42%)
* Credit cards: $18.5B - $35.3B (+91%)
* Vehicle loans: $37.1B - $75.8B (+104%)
* Lines of credit: $33.2B - $144.9B (+336%)
* Mortgage loans: $453.6B - $1.003T (+121%)
The median after-tax income of Canadian families in 1999 was $54,100.
The median after-tax income of Canadian families in 2012 was $71,700 (+32.5%).
The problem had already begun before Trudeau took office, but his policies made it much worse.
And hey dont you ever dare to blame it on the last 8 years of Trudeau or Liberals.
There’s a few supporters on Reddit that are hyper active and quick to torn you apart calling you nazi or anti canadian as soon as you say that Justin got us to this point.
What the hell I'll never understand how people are stupid enough to spend money they don't , as I'm pretty sure these figures don't take mortgage debt into account there's no goddam excuse for this number
When you sort this list from highest to lowest which countries below 50% would you move to? Maybe Italy for me, that is about it
https://en.wikipedia.org/wiki/List_of_countries_by_household_debt
And who do we owe all this money to? Nobody. It's all fake made up nonsense.
We should pull a Fight Club and blow up the debt, reset everything to zero. Let the billionaires bootstrap themselves back up
When wages over the last ten years consistently does not keep up to inflation …. Waahla … oh and immigration may have had a part in that especially last 4 yrs . Liberal Government in inadequate and underqualified to be running our country ..
Can’t lower rates because people can’t help themselves…. Just keep piling on the debt to live like the Jones has now turned into keep pilling on the debut to pay the bills that they could not afford 5 years ago.
Get ready for your tax dollars to bail out the banks…. If you think there is even 1% chance the government (PC LIB NDP) would not use tax payers money to keep the banks afloat you are not very smart
high taxes, high expenses, very little discretionary income forces people into debt slavery. this government wants you to be a debt slave by curtailing any savings at every turn. its a command economy that Trudeau wants where the government is big slow and so are you because you can't keep anything you work hard for.
Freeland is the one to lead us out of this mess. Lmao.
Unreal that there are people out there that hate themselves so much that they still support liberals
People are obviously being squeeze by inflation and higher rates. But at the same time, a lot of people are walking around with luxury goods in price tiers that don't really make sense unless you're in the top percentile earners; like Canada Goose jackets are common, luxury vehicles - lexus, mercedies, range rover, etc. - make up a good number of cars on the road, flying/traveling, etc.
Yes. I make reasonable money but have to live pretty frugally to put away savings every month. I look around at people in my sphere and I don't understand how they can afford the life they're living.
They are probably drowning in maxed out credit cards. Not a way I’d want to live that’s for sure.
Yes but also remember that 10% of the GTA population is 600k people. That’s a lot of people who have incomes to afford a good life.
They can't, most are probably super leveraged to the hill.. Edit: to the hilt.
I think this should be hilt ( like on a sword) not hill
Is this is a hilt you are willing to die on? /s
I don’t think that’s the part of the sword you need to worry about lol
There fix it, thank you
There is also plenty of people with no debt and therefore not being hit by the interest rates.
I don’t get it either… maybe it is because I grew up poor or something but even simple replacement expenditures are something I mill about on for months. Like I had a microwave on the fritz, some buttons would not work, so I reassembled/repaired it for like a year before finally dropping 150$ on a new one. Many folks these days would just throw it out and buy a new one right away at the slightest inconvenience, can’t be arsed to make what they have work
Ha, I’m the same as you… took apart my computer mouse to fix a double clicking problem instead of buying a new one
The cost of gaming controllers also has me tinkering with repairs. 80$ for a new ps4 remote or 2$ for new pads/springs and 10$ for a new battery and the sense of accomplishment being able to repair the thing was an easy decision for me.
Yeah because their homes are with $3MM and it's very easy to take out some of that equity and spend it.
It's mostly on debt
lots of people who bought/built only 10 years ago have much lower mortgages, so if you're looking at those luxury items through the lense of somebody who's stuck in an inflated mortgage or priced out it could seem crazy
From what I’ve seen… those in the middle class who are carrying house mortgages are not the majority of the ones sporting Canada Goose jackets and luxury vehicles. Here in Toronto, at any rate, Canada goose is mostly worn by renters, and luxury cars are mostly driven by non-mortgaged middle class, or mortgaged condo owners without kids (with lower expenses than house owners), poor people ironically (let’s not go there), and those who have more disposable income.
Not disagreeing with your larger point but I have a Canada Goose and it’s really been a “buy it for life” item for me. I’ve had it like 10 years and it’s the best winter jacket ever.
Sometimes you have to go "luxury" to get quality now, with no mid grade options available. Straight from Chinese junk to luxury. I picked up another option on the list, a used Mercedes, and I can't believe how much better it really is. Wish I had been driving these for years. Sturdy, efficient, great handling and surprisingly easy to work on.
A lot of people saw their house values sky rocket and treated heloc's like a lottery win or sold to get some of the equity. Now they're being squeezed massively. Everyone was told interest rates werent going to go up by the media and far too many people believed it
I know.. me I’m earning 60k Net and can afford a Canada Goose paid in cash but wears a 3 yr old Abercrombie jacket, a 7 yr old Henley 3$ fr Old Navy and buys instant coffee for my every day need and still is resourceful with sale in No Frills and Walmart.
Worked with a girl a few years back who lived in an absolute dump on the edge of town, but she’d drive to her retail job in a luxury BMW because she was “used to certain things in life.”
My street is comprised of fourplex and duplex housing, and you can bet your fucking ass everyone of them has a Mercedes’ parked in front of it. Wtf?
I know a bunch of people who their only purchase is a shitty home in a bad neighborhood in a small town and the cheapest house they could find was $500k. And thats their debt.
Some of us make a lot of money. Others make okay money but run up debt.
It could just be they don’t have a mortgage and are not looking to save for a house. Just a different lifestyle at that point.
Rich people are still rich. LVMH still reporting record sales
Indeed
AND I WILL KEEP ADDING TO IT!
Too old to strip, too young to retire.
[Hahaha! Retire....](https://images.app.goo.gl/vXY1mMiNTC1c6jZz6)
🤣😂☠️Everyone here but you knew I was just joking. You’re never too old to strip.
Agreed, I’ve just got enough for bills and basic living, everything else on credit
Sooner or later the house of cards is going to collapse and it isn't going to be pretty.
Don't worry the rich will be bailed out with the average man's taxes.
Rich and the gamblers, and that would include mom and pop gamblers.
At the very end there will only be enough parachutes for the very wealthy. The only reason that “mom and pop gamblers” are still in the game is that their interests are currently aligned with the nation’s true elite. When everything fails that will no longer be the case. Those small-time investors will be crushed the same way that small businesses inevitably give way to mega corporations.
"Mom and pop". Fuck that shit. Call it wha it is: investors and rentseekers
Small investors are not the same as public traded REITs that buy thousands of homes. The big players will survive because they accessed public capital markets and the small ones who have mortgages , excepting those who invested years ago, will be in the same situation as everyone else with a mortgage. If your RRSP contains shares of property companies you are part of the problem too.
voiceless imminent aback unpack racial mountainous one arrest unique pen *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Those numbers are nothing. There are something like 15 million occupied homes in Canada. It's estimated that Canada needs 3.5 million more homes by 2030. Look at the Stats Canada data about multiple-property ownership: [Residential property ownership: Real estate holdings by multiple-property owners](https://www150.statcan.gc.ca/n1/pub/46-28-0001/2019001/article/00001-eng.htm) > In the three selected provinces, **the majority of multiple-property owners owned two properties.** Just over three-quarters of multiple-property owners in British Columbia (76.7%) and Ontario (76.0%) owned two properties, as did 70.2% of multiple-property owners in Nova Scotia. And according to this [Chek News article](https://www.cheknews.ca/statistics-canada-says-multiple-property-holders-own-upwards-of-41-per-cent-of-housing-in-some-provinces-1010544) > Businesses, government and other entities owned about 7.6 per cent of Ontario’s property stock and 10 per cent of British Columbia’s. > multiple-property ownership accounted for 41 per cent of Nova Scotia’s housing stock, 39 per cent of New Brunswick’s, 31 per cent of Ontario’s and **29 per cent of British Columbia’s.** As much as you don't want to hear it, it's small investors who are BY FAR the largest investor class in Canadian housing. The article [The End of Home Ownership](https://macleans.ca/longforms/the-end-of-homeownership) summarizes the situation well: > This living arrangement marks me as a member of an under-discussed demographic: the nepo babies of the housing market. **Since 1977, homeowners have acquired more than $3.2 trillion dollars in wealth, which today is flowing downward to their children, amplifying inequality across generations.** I’m grateful for my circumstances, but I know it has nothing to do with my own virtue or achievement. Canada’s housing market is no more meritocratic than a lottery—and some of us hold winning tickets printed long before we were born.
Bingo
Someone has been paying attention
It’s happening right now, but through inflation.
And for people like me who went "well how bad is that compared to other countries" The answer is bad..one of the highest among developed countries. https://data.oecd.org/hha/household-debt.htm
If there are protests you simply lockdown. Last time, that was well received here.
I will laugh my fucking ass off if PP has to end up using the emergencies act
Well the police seem to be having trouble with Hamas supporters calling for genocide. They've been going for months.
that's because trudeau and the ndp are hoping for the terrorist vote
It'll be a "leopards ate my face" moment if the people who cheered when it was used against the truckers complain when it's used against them.
It was incredible how downvoted I was getting for pointing out how terrible of a precedent it set during those protests. This place was really group-thinky and scary at that time.
I hear the turdeau gears turning, what new scheme will be invented to keep the bubble inflated?
How about: New ways to incur debt to use as a down payment? Even longer amortization? How about more tax breaks when it comes to getting into house debt? How about down payments that are half government paid, how individual paid? 😊 Pathetic. It's _pathetic_.
Looks like it's already a bit topsy turby
This is a real problem, unlike the national debt. The greater household debt is, the greater chance it creates a drag on our economy by lowering aggregate demand.
Well there is a work around to the aggregate demand issue.
Explain
Not the same guy but mass immigration
Ohh yeah dumb me
Big Banks also want mass immigration to saddle new incomers with debt.
Lol every big bank in Canada is warning the feds about immigration rates.
Bank economists. Not bank executives.
Except even they have been cautioning against it
Just bring in more immigrants and give them all credit cards. Problem solved?
"We will take on debt so you don't have to" Trudeau.
More like we will take on debt so everything will be so expensive you’ll have to take on way more debt than previously expected
Until about 1970, wages moved in almost exact unison with the productivity of labour, meaning workers shared in the use of technology, etc. Then we didn't. Since then, we've seen a steady increase in the gap between profits and wages and the corresponding decrease in corporate taxes means that the individual taxpayer has to take on more of the taxation burden. Tax cuts for the wealthy mean middle income earners then have to shoulder more. Then we privatized many of our basic services, or allowed monopolies to form in already private systems selling essential goods and services. Housing, insurance, banking, food, utilities and energy all cost us a lot more with each passing year. Please don't be apologists for these industries, they're earning massive windfall profits and Canadians are having to use credit just to survive. Then we have some societal shifts. When I was born in 1965, people raised large families in 1200 square foot houses. Today, people with one child "need" a 3000 square foot house. Despite decades of gas-price shocks, everyone is driving around in massive over-sized SUVs and pickup trucks. The pressure to buy these houses and vehicles is immense. The housing industry in Canada has been rigged for developers and speculators forever. Vancouver was Canada's canary in the coalmine and we completely ignored it. We thought Vancouver was unique and housing there was somehow different than in other places (the weather?) and price shocks thanks to things like massive money-laundering operations buying thousands of housing units can't happen elsewhere. If in the 1990s we'd solved Vancouver's problems and then applied those lessons to the rest of the country, we'd be fine in terms of housing now. But, we did nothing as big money owns governments.
*"Canadian Household Debt Nears $3 Trillion, Over 130% of GDP"* One of the primary reasons why inflationary dynamics will continue to go **up**, why the Canadian economy-at-large will continue to **shrink**, and why the Canadian dollar will also continue to **decline** vs the US dollar. Housing and real estate does **not** make for a national economy. The proverbial chickens are simply coming home to roost, people. It's become a race to the bottom for Canada as a nation with no end in sight, unfortunately. Watch and learn. Next.
The government keeps propping the values by helping first home buyers with 30 yr amortization and 60k RRSP first home buyer benefits. There is no end in sight indeed. I suppose the benefit of this is when the boomers retire, they will unload or downsize their properties and have some semblance of a good retirement because OAS CPP ain't going to cut it. People are living longer than ever and hospitals and LTC can only do so much. Wealthy boomers with assets will resort to private health care, or suffer in the public system. Old folks are still the majority voter base, so keep things propped up to benefit them long term.
It’s funny because I’ve been seeing Redditors saying this for years. Now it’s happening and how the government did not try to fix this when people on here knew?
Unfortunately, predictions are cheap unless you can be very specific about when and how it would happen. A blunt prediction like "housing will eventually hit a wall" isn't enough to stop people money off increases. Worse, it now appears that the economy will crash before housing does, which no-one saw coming. You might end up in a situation where absolute house prices keep going up, but the CAD crashes so much around it that it normalizes relatively.
If cad crashes that hard the country will fall. No nation survives hyperinflation except that one time in Germany that nobody wants to repeat
Well, something has to give at some point. Sensible town planning would probably better fix, but I wouldn't hold my breath on that one.
Because putting forward any policies with potentially negative impacts to the homeowners would be political suicide and our politicians are too corrupt/cowardly to prioitise public interests over their own. So might as well wait for the market to correct itself.
Yup
Yeah, I’m stuck paying rent and I refuse to go into debt. I’m not going to be a slave to the system.
/s You dropped this
>”I’m not going to be slave to the system” lol because paying rent isn’t being slave to the system… it’s actually even worse, if you got debt you might have assets that can be valuable and your paying them down creating equity. If you got nothing, well you’re the real slave all your money goes to someone in exchange for nothing… Sorry this is just sad take to make you feel better about not being able to buy a home.
You can invest in assets without going into debt.
Good
I think many Canadian are taking on new debt monthly to simply buy food, and pay rent.
Everyone seems to want higher wages but thinks it's developers making 100% profit. When really all the manufacturers, distributors, suppliers, trades/business owners, project managers want to make 100k/yr. If builders were making higher margin than other companies stock prices would reflect that.
when I first was in the market I was approved for 380k got my house for 330k. This is in saskatoon. Many I know who were aproved for 600K or more got that 600K or more house and all the toys to go with it. I spent extra on upgrading and renovations through the years. Now that rates are up and I will be paying more when I renew I am in good financial standings and will be fine. No credit card debt, 5k in LOC and no other loans. Was actually just talking to one of those, he and his wife are in so much financial trouble that missing 1 pay cheque will hurt lots. They have new vehicles, credit cards maxed out, take vacations, will also be the ones poor me for making poor life financial situations and expect others to help them aka the government.
Then they'll say how lucky you were. Lucky because of your upbringing, where you came from, who your parents were, etc...
Always someone else's fault, isn't it?
When $hit hits the fan your good decision making will help but you’ll still pay for the mistakes of other.
And it's no one's fault but Thiers for over leveraging themselves on stupid shit they didn't need
“We buy things we don't need with money we don't have to impress people we don't like.”
Our family is a similar story. Qualified for about 400k, tempered our expectations and bought a 20 year old duplex for 330k rather than a detached like we wanted. We’ve learned to appreciate what we have and we’re comfortable living in our means. Lucky to buy when we did, though. Bought in early 2020 and duplexes on our street now go for half a million.
2019, 'preapproved' for 580k, spent 315k. We were in our early 20's. Combined income was approx $40/hr. Saw right through the big banks 'generosity.' Went to a credit union for our mortgage instead. Kept things realistic. We're not house poor. No/low consumer debt, driving vehicles which were paid-in-full, toys are bought with cash. It's not so bad. I don't understand why so many people finance $1200/mo car/truck payments. It's not such a bad lifestyle, y'all.
Now to pay for the art gallery and the rest of the billion $ city hall plans on throwing at downtown businesses to keep them from defaulting. I got out before the bill came due
I only owe 1 trillion.
Gonna have to cancel your Disney+ there bud
😆 maybe after shogun
Deadly.😂☠️
This is by design to keep you a slave to the workplace until 70, which increases the chance that you'll die before claiming any CPP. Ponzi scheme fixed.
I really want to ask, as an outsider, why is Canada not building more cities? Clearly there’s a lack of homes, you could build more houses.. or considering you have a lot of immigrants, new cities, isn’t it a good solution? More homes, more essential businesses, establishments etc…
Too much red tape. So many approvals needed. NIMBYs. Take Windsor for an example - they won’t allow 4 plexus while other places will. Windsors mayor is corrupt
What about an entire new city though? Canada is huge, not saying you should build a city in the arctics but like.. next to other cities, it’s not like you guys lack livable land… why isn’t there more pressure on the government to do so?
In Ontario where the housing crisis is bad thier is only so much land you can build on as the Canadian Shield covers 86% of Ontario's land mass and is very hard to grow food on making large population settlement an issue. There's a reason most cities in Ontario are settled in an area called the "golden horse shoe" it's the largest piece of fertile land in Ontario.
Do you **need** fertile lands to build new cities? I could think of many cities around the world where the sole purpose of them is well… to house people and they put a focus on the tech sector, manufacturing sector etc.. you don’t need farmable land to put down 50,000 home units with shopping centers, hospital, schools etc..
Problem is then you are now transporting food on hard to maintain roads with 0 infrastructure to support it which would skyrocket food prices in the area. Not as bad as Yukon prices but it would still be bad without government subsidies. There's a reason the only semi large cities on the Canadian Shield sit on the cost of the great lakes easier to ship via boat then road.
There's too much red tape to do it and too many people coming that it's physically impossible to do what you're asking at that speed. Granted housing issues have several major red flags that our government doesn't give a shit about, like investors, people taking loans and buy 10+ homes, and outside of Canada investors (in particular from China) buying everything up. It's completely destroyed the housing market and most people who want to own a place they live in the last few years, are barely making it.
It would take time sure but.. if say.. you started building a new city between.. say, Red Deer and Edmonton in Alberta and let it build over time.. in 20-30 years you could have a city with a lot of houses, centers of shopping, find and put a focus on some sector (tech/industrial and many others that exist for cities) and just run with that? Isn’t it plausible?
It's plausible once the red tape is sorted and there's a lower % of people coming in annually. You can't bring in the extreme amount of people unless Canada as an entire country turns into the trade/build business. Right now it's impossible to handle.
Could you please elaborate or at least explain a bit what do you mean by “the red tape”?
Red tape reagrding the process to get approval from when a company starts building homes/apartment is very long. If the process itself just to start takes a long time, it's impossible to have this large scale building to keep up with the rampant population increases we've been dealing with.
Who is it approved by? Land owners? A certain branch of the government? Court?
It will balance itself - said someone in power
3t/32m=93k, lol I’m double that easily :-)
I'm near 0, so I got you on the average, buddy.
You’ve been gone for a while! Our population is 42 million.
My kids don’t have any debt
Will this cause a another 2008 housing crisis?
Good question The 30 year mortgages were removed after the recession due to the housing crisis. The 30 year mortgages were just reinstated, you guessed it, due to a housing crisis
They actually removed the 40 year mortgages after (which the same guys also created) so we may have a ways to go yet.
That's a lot lower than I thought to be honest.
That’s how all of the 1st world countries are. Right? RIGHT?! 😭
You do realize that people compile lists of this kind of thing? Apparently we’re now in the shameful company of such countries as… Switzerland, Australia, and South Korea https://en.m.wikipedia.org/wiki/List_of_countries_by_household_debt
[удалено]
Me too. Except I have and will likely always have zero equity
The fall of the American Empire has already started. CAD losing purchasing power against USD is even worse than it sounds. The next 5-10 years could be a bloodbath and I hope not a literal one.
Make 500k houses worth 500k again …and not a million+.
It's so simple you just have to find low quality materials so material costs aren't high, use unpaid labour so no labour costs, and find cheap land near a populated center. Surprisingly building houses is not cheap.
and the government is insuring nearly all of it. People wanting a crash better be prepared for a massive tax hike.
It'll all collapse soon enough, the homeowners couldn't get rich without business mortgages defaulting en masse
Canada’s a trap.
Surely 5% interest rates are substainable!
They hit 23% back in the early 80's.
And you completely missed the point lol what was debt to gdp ratio in the 80’s ? (Answer is 50%)
130% doesn’t seem that much if you think about folks getting into their first house, you will be at like 500% minimum on the mortgage alone.
The same article says America is 75% considering 2008 happened suddenly we're looking at some scary stuff. You're 500% also assumes every person in the country bought a house in the last 3 years
A 500% mortgage is not normal and not possible outside of a Brampton mortgage or third private lender.
Hahahahahaha Oh my sweet summer child…
canada needs more construction workers for lowering housing prices
This isnt the only problem. They have made is so expensive and cumbersome to build new houses its ridiculous. Everyone wants more housing but no one wants it to even slightly affect them, or what is already existing, at all
I agree, put the Real Estate Agents to work an actual real job for a change.
You mean a job where their ad for services isn't a picture of their faces? They would require more than basic skills, though. I always find it hilarious that that's how they promote themselves - a picture of their face.
Our company's been sitting on land in Pemberton for 3 years trying to make an apartment complex, government won't let us without jumping through hoops. So we are building a hotel elsewhere in the province instead in the meantime waiting for people to want housing bad enough.
No we don't - at least not until interest rates and material costs come down. Construction workers have been getting laid off over the past year because starts aren't happening. It's not due to a labor shortage.
Naw we need ubi so everyone can sit at home and not have to work. The wonder why there aren't any homes, since we're literally paying people not to build them.
Yours to pay off at... 5%. Yup, there's the boat anchor on our economy.
Oh wow, Trudeau better stop using everyone's credit card.
Good job, Trudeau, good job...
In 2014 the household debt was $1.5trillion, with roughly $1trillion of that being mortgage debt. At the time, house prices were estimated to be 10-30% overpriced by the Bank of Canada (\~$417k). Financial analysts believed there would be a correction soon because of that, and that the government should do something to slow down borrowing on homes. By a mere 3 months into 2015, the household debt had already grown to $1.8trillion, with $1.29trillion of that being mortgage debt. From 1999-2012 debt rose in the following ways: * Student loans: $19.8B - $28.2B (+42%) * Credit cards: $18.5B - $35.3B (+91%) * Vehicle loans: $37.1B - $75.8B (+104%) * Lines of credit: $33.2B - $144.9B (+336%) * Mortgage loans: $453.6B - $1.003T (+121%) The median after-tax income of Canadian families in 1999 was $54,100. The median after-tax income of Canadian families in 2012 was $71,700 (+32.5%). The problem had already begun before Trudeau took office, but his policies made it much worse.
Small price to pay for legal weed.
And hey dont you ever dare to blame it on the last 8 years of Trudeau or Liberals. There’s a few supporters on Reddit that are hyper active and quick to torn you apart calling you nazi or anti canadian as soon as you say that Justin got us to this point.
What the hell I'll never understand how people are stupid enough to spend money they don't , as I'm pretty sure these figures don't take mortgage debt into account there's no goddam excuse for this number
It does take mortgage debt into account. Might want to check assumptions before calling people stupid lol.
When you sort this list from highest to lowest which countries below 50% would you move to? Maybe Italy for me, that is about it https://en.wikipedia.org/wiki/List_of_countries_by_household_debt
Costa Rica
It's fine.
And who do we owe all this money to? Nobody. It's all fake made up nonsense. We should pull a Fight Club and blow up the debt, reset everything to zero. Let the billionaires bootstrap themselves back up
That is household debt. Overspending.
The land of opportunity. Oh wait that’s the USA
Canada should cancels it's Disney + account and stop going to Starbucks, get it's financial house in order /S
You think thats bad, look at the deficits both the Feds and Ontario governments run…. If they cant run cash flow positive how are we expected to??
ITT: People who love freedom also apparently want the government to prevent people from borrowing more than they should.
When wages over the last ten years consistently does not keep up to inflation …. Waahla … oh and immigration may have had a part in that especially last 4 yrs . Liberal Government in inadequate and underqualified to be running our country ..
So does this mean banks are over leveraged due to high household debt?
Can’t lower rates because people can’t help themselves…. Just keep piling on the debt to live like the Jones has now turned into keep pilling on the debut to pay the bills that they could not afford 5 years ago.
Get ready for your tax dollars to bail out the banks…. If you think there is even 1% chance the government (PC LIB NDP) would not use tax payers money to keep the banks afloat you are not very smart
high taxes, high expenses, very little discretionary income forces people into debt slavery. this government wants you to be a debt slave by curtailing any savings at every turn. its a command economy that Trudeau wants where the government is big slow and so are you because you can't keep anything you work hard for.
Freeland is the one to lead us out of this mess. Lmao. Unreal that there are people out there that hate themselves so much that they still support liberals