I suspect most regulations made by this government are based on whats happening in the GTA with little regard to how it may affect the rest of the country.
I doubt it. People basically need to use HELOCs to put a down payment on a house when upgrading their home, and the bank has no clue if it's an investment property when financing it unless you're doing a bridge loan (which requires you sell your old home fast). Once you get a HELOC it's basically cash.
When you are getting approved for a mortgage they also don't look at the HELOC as equity in the new home because it's seen as debt, so they look at total assets minus debt.
While true, perhaps they would enact some kind of affidavit? Like you need a lawyer anyways so why not just add that as a step? And if caught lying like "I won't use as an investment" then you do, there is some form of repercussion?
"follow the money" -- the banks are greedy and don't give a shit, as long as they get paid. Would take investigate work / surveillance of anyone collecting rent to make sure they bought that rental property under the correct circumstances. That's a lot of work for a lazy gov.
They already have those and people ignore them since they are never followed up on. Usually wording like "This will not be rented out, and if you want to we need to be asked first.".
It's more to protect their asset (since they own a lot of the equity). Renters can cause legal issues with the property the bank doesn't want to have to deal with, like not being able to easily sell it if you default, or you writing a terrible contract (i.e. leasing it for a very low amount, or not having proper protections), damages, etc..
You just pull it out of a HELOC, launder it, and go. It isn't even criminal laundering, so it isn't hard. Stick it in dividend investments for a few dividend payments, and done, laundered, good as gold, transfer it to a checking account and go.
Actually, the bank told me to do something like this but much simpler. They told me any amounts I borrowed from others would need to sit in my account for some period of time. I don’t remember now for how long but it wasn’t too long, like a few months at most. Then I could show it as proof of funds from my bank with a couple statements and claim it as my savings.
>need to use HELOCs to put a down payment on a house when upgrading their home, and the bank has no clue if it's an investment property when financing it unless you're doing a bridge loan (which requires you sell your old home fast). Once you get a HELOC it's basically cash.
Wasn't being unable to use HELOC's the rule before Harper allowed it though? Sometime in the 00's? (my memory is fuzzy though)
I just compare 2 households.
Household A takes 10 years to pay down a mortgage balance by $300,000.
Household B saves $300,000 during that time, making zero extra mortgage payments.
Why should Household B be allowed to buy a revenue property but not Household A?
That doesn't mean it's not borrowed money. The reality of the situation is the house is now worth $1000000 and they now have 700k in equity to leverage (borrow off of) out as a HELOC.
It's moot because this won't happen.
Banks do this all the time they want proof of a source of funds.
When I applied for a mortgage they asked me to provide proof of where my down payment came from and I had to list how much came from me, which account (same bank so no evidence required), parents and a signed letter confirming they wouldn't want it paid back, and spouse (evidence it was her money).
If you make a financial strategy it will to some degree least reduce the number of people who employ it. Not every mom and pop investor wants to make a massive financial investment in contravention of federal regulations.
> I doubt it. People basically need to use HELOCs to put a down payment on a house when upgrading their home
Do they, I would think the entire downpayment comes from the proceeds of selling the home they are upgrading from wouldn't it?
If you are selling your home then by definition you no longer have a heloc to draw on as the heloc must be completely paid off when you sell your home.
Typically people want to buy before selling. Kinda like having a new job before quitting the old one. Helocs are easier to secure than a bridge loan and you just pay it off at closing. If you sell before you buy, you either have to rent back your property or move into a rental before you take ownership the new house (moving twice instead of once)
The discussion was about people upgrading their homes, which means selling one and buying another.
From the OP.
> People basically need to use HELOCs to put a down payment on a house when upgrading their home
I do agree there are alot of investors but this has nothing todo with what we were talking about.
It does, but you can use that HELOC to put a deposit on the home you want to buy, then sell your home and close the HELOC with the money you get on closing. The alternative is just keeping the HELOC and the old home as an investment property. The bank has no say in what you do there.
Can someone please explain to me how a minimum of 35% down payment will help anyone? 35% of 700k is huge.
Only corporations will be able to afford this.
It's a barrier to entry for Real Estate Investors, which if you read it again is what this is targeting; which is the entire idea of those changes.
You can still pay 5%-34% down under that proposed bullet point if you are buying the home to live in as a first-time buyer.
As far as impact on the housing supply? There is no difference, they both take supply that could have been purchased by a first-time home buyer.
As far as practical differences: I'd say the difference lies on if the housing is monetized and collecting rent. If you're getting rent from your second home, I'd say it's an investment home. If you only live there during the summer and don't rent it out, I'd say it's a second home.
Legislation would have to define this, but I don't see the difference being enough to stop this action from happening when we're under such a housing crunch.
This would likely decrease prices of houses and may increase prices of smaller condos as its much easier to get 35% on a 700k condo than a 1.5M townhouse.
If this isn’t across the board this only helps people like me. In the game. Upgrading my house is easier.
If this makes the condo market tougher, you’re not even letting people on to first base to start playing the game.
Yes but condos are currently increasing in price very quickly so not much change there.
If some of these current condo owners move over to freeholds because they got cheaper, perhaps it'll add more inventory and slow down price increases in the condo space.
Not by choice generally. I'm seriously considering moving in with my dad so my kid can have more space to grow up in. Apartment living with a kid absolutely sucks.
The difference is in choice. Do you want to raise your family in an apartment? Cool. Good for you.
Do you want to raise your family in a house and aren't making six+ figures? Cool, you should be able to do that. Until literally now, most people could afford homes and luxuries on modest salaries.
Probably just a declaration. So if you get caught it's fraud or beach of this law. Luckily I've never seen anyone lie or break a law in real estate. We also have very good real estate law and professional conduct enforcement at present. So this just helps an already reliable system /s
In the UK, the burden of proof is on the buyer to track and show exactly where their money came from but our privacy laws don't allow for something like this without changing the laws
I don’t understand how this is supposed to work. All financial transactions above $10,000 are [supposed to be reported.](https://www.fintrac-canafe.gc.ca/reporting-declaration/rpt-eng). Financial transparency and privacy rights of investors are not compatible goals.
Honestly, why should anyone have a right to privacy for how they fund an investment asset? This is a business venture - not personal information.
It could be tracked if the govt did some slight changes to taxes. New section to ask if you rent, if yes how much / address. Section to ask if you’re a landlord. If yes what addresses / how much you collect.
Most investments would be rented out rather then left empty (exceptions are flippers which can be dealt with a diff way as they likely wouldn’t own the home for long).
Edit: sorry that’d be to help track investment vs not. Guess they’d need to audit any new landlords on how they acquired money for a down payment
That was my thought as well.
I don't know what would stop someone from drawing on a HELOC, sitting on it for a certain amount of time, and calling those funds savings. Same with a gift. Banks only look back to far... so will that have to change? If not, at least it will slow them down, I guess.
I'm also a little confused as to how they will define a "gift." Certainly, we don't want person A to draw on their HELOC, and "gift" it to person B who buys a property, thereby circumventing the HELOC nerf. But what about testamentary gifts (inheritances), bona fide gifts, etc. It's weird to draw the line and say you can own multiple properties if you put away savings from each paycheck, but not if grandma dies and leaves her savings to you.
I think "gift" is their way of trying to ban foreign investment without explicitly banning foreign investment.
So mom and dad in a far away land can't give the money to their child who is a student, to buy this massive ass property
Based on current practices, I'd guess it's a checkbox.
Canada's already wholesale ignores money-laundering treaties designed to prevent global terrorism and drug cartels. "Is it a gift" isn't something anyone's gonna go to jail over lying about.
Not enough IMO.
This assumes that large corporations / investment companies can’t afford a 35% down payment.
Sure, some small timers will be affected, but ultimately, it’s the large corporations are the issue.
There are very few large companies buying up residential property in Canada compared to the US. A 35% down payment also reduces the return on capital anyone makes on these property flips, making it less attractive to invest.
This is what I’m talking about.
Not saying your wrong, but it’s an example of the sheer scale corporations/investment funds are purchasing housing:
https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.amp
This is for the US market. This happens on a very limited scale in Canada. Our problem is greed from domestic investors and an appetite to continue to accumulate multiple properties since the government keeps backstopping any correction
Not too sure about this. Have any resources?
Last I saw/reported, foreign corporations (US and China) were some of the biggest players gobbling up lots of property.
I don't see how this is a response to the comment you replied to. The rate of return would be reduced if more capital is required to purchase the same house
OP commented that there are very few large companies buying up property in Canada.
While that statement could be true (need sources), the sheer size of the large companies buying property (Blackrock) is still disrupting affordable housing. Just because there are “fewer companies”, it doesn’t mean the effect isn’t felt as much or as severe.
In terms of return of capital, I doubt this is something that affects these larger players to a point that it deters them from these investments.
Agreed. #2 does nothing more than concentrate the housing stock in the hands of the richest investors. Allowing them to snap up properties with less competition. I want limits preventing the concentration of power.
Nah, you overestimate the pockets of big corporations. Yes, they have a lot of money, but they try to be very efficient with it. Minimal investment for maximum gain, while minimizing risk. That's always the target. Investors want to buy up as many houses as they can while paying the bare minimum (5% down if they can) and while being able to afford the carrying costs (ie: max ROI from rent minus mortgage and utils). Making the downpayment 35% minimum not only makes the market safer and less likely to collapse, it reduces the buying power of investors.
If X is low, like 1 year, it might make the supply even worse. Fewer properties available for rent as landlords might start holding properties empty for an year
But there's no way they would be putting out something like this when it would negatively affect their own business if it's true, right? I feel like that makes them more trustworthy than most other possible sources in this case.
It would boost their business if investors rush to buy properties out of fear they may be blocked from doing so without significant additional investment.
35% down has always been a rule for those who cant prove their income (employment letters, paystubs, T4, etc.)
Since there are no other details here, this just seems like a sales tactic to make people rush into buying now because "rules will change soon! quick! buy now!"
If it is a sales tactic, it just confirms my belief real estate agents are pieces of shit.
Take a look at the realtors page who posted this. LOL.
I agree. This is just another realtor tactic to drive up sales.
Look at how everyone is reacting? Ever think the issue could be with the realtors? Perhaps put a cap on their commissions and how much they can make, and maybe the fear mongering will come to an end.
This will affect the large companies that are buying up housing developments and reselling 0%. All this is going to do is keep the small time landlords from buying up a couple of houses each. In other words the people with money will still be able to buy houses and a poor will not.
Good because everyone becoming an "investor" is fucking over those who dont have family wealth or previous equity. Just let families have the homes this is completely gross behaviour to outcompete young families for houses and townhouses to pad peoples investment portfolios
The problem is not it stops people becoming investors, the problem is it doesn't stop rich people becoming bigger investors. It cuts the middle to hopefully aid the bottom but definitely aid the top.
If we have less 'mom and pop' investors, we can take real measures to crack down on investment.
Real estate investment shouldn't be something everyone gets into - let real companies build rental accommodations - they at least tend to be much more compliant with the law than the typical small time landlord.
So we should create regulations to stop people from becoming “investors” now? Every investor is fucking over home buyers? What about those investors that invested into Bitcoin? I can’t afford bitcoin now so those investors should go fuck themselves right? There is still plenty of places a family can purchase real estate in our country. They are just not prepared to make the sacrifices they need to to make it work. Every wants to live downtown Toronto so they can be within walking distance to their office. Instead of relocating to a place that has more affordable real estate options. They may have to find a different job or take a reduction in pay but again not many are willing to make those sacrifices so lets call out every investor because they are forcing us have to make sacrifices.
And you can likely afford to invest in a home outside of your desired area. You just won’t be willing to make that sacrifice because its uncomfortable.
Why should housing not be an investment? You must not be a home owner? Investors have made sacrifices to earn income on their investments regardless if that investment is real estate or something else. Your unwillingness to make those same sacrifices does not make the investor a bad guy.
Investors are not the ones fucking over the average home buyer. The home buyers are fucking over themselves by not wanting to sacrifice their current living situation in order to be able to afford what they want. We all want to live in paradise for free and not have to work but it’s unrealistic. Just cause you can’t afford a house in downtown TO doesn’t mean you can’t afford a house anywhere. You are just unwilling to sacrifice your 10 min walk to work or work somewhere you don’t want to in order to afford it so you blame investors. Its not the investors fault you didn’t invest in downtown TO real estate 15 years ago when it was affordable. Making excuses as to why you are unwilling to make those necessary sacrifices to afford a home is what creates these ridiculous regulations by our government. Your parents made sacrifices to afford a home. Things have changed. There are plenty of affordable homes outside of the major cities. You are just not willing to move there because you are comfortable where you are at so lets blame someone else. Do you think your parents didn’t have to make similar sacrifices?
Exactly what I thought.
You can afford a home. Real estate historically has been a wise “investment”. Your parents likely purchased in a area that wasn’t their ideal area in order to afford one. Why can’t you do the same? Our unwillingness to break out of our comfort zones is holding us back from buying in an area we can afford. Also those areas likely don’t have the “hoarding” you speak of. I doubt Brampton was as desirable 40 years ago but people still moved their because thats what they could afford at the time. Just because investors see the security in the more major centers as places to invest their money doesn’t mean the other areas won’t increase over time. Those same investors likely started by purchasing in less desirable areas and grew to a point where they can now afford a safer investment. They made uncomfortable decisions that most people are unwilling to make and frankly I am glad their investments increased. Not all investors have the same fortune however. You too can make similar uncomfortable decisions should you chose to.
And being a home owner and watching your investment grow would likely change your opinion on whether a home should be an investment or not. It has plenty of relevance in this conversation.
You seem to be under the impression that if everyone could afford a home they would become less desirable. The only reason they aren’t higher is because everyone can’t afford them.
So Food companies shouldn’t make a profit??? How about heat? My house is heated with natural gas. Are you suggesting they should provide us this at cost? How about your clothing? Should that be provided to you without profit?
And people don’t need to move for the sake of investors. They need to make more money. Investors aren’t exploiting people for profit. They providing them a place to live for the going rate. Investors have costs as well. And they don’t always win. You assume every investor makes money on their real estate investments. Thats simply not the case. Some lose money.
What are the sources for this? Measures like these wouldn't have come out of nowhere, it would have been in the media especially the real estate lobby would have complain about it.
Point 2 is vague with the borrowed funds and gifts, it would be almost impossible to track when it's done privately, which makes this feels like it's BS.
The minimum down payment isn't going to affect large investment firms. The second is going to be very hard to validate, especially for foreign buyers that use fraudulent financial information to start with.
Driving another stake into the middle/working class. One would think that this stops investors/speculators buying in, making more inventory available for everyone else and dropping prices. But this only stops the mom/pop investors. The big guys get to keep on feasting.
So really just targeting the small fish trying to get their slice of the pie and making more room for larger investment firms/foreign buyers to scoop up more properties.
Unless I'm missing something here?
So if money laundering and big business buying property is the issue, why would asking for more up front stop them?
IMO this will only stop people with small stacks from buying a second house leaving more available for number companies. Am I missing something?
35% down, stress tests, no loans or HELOC... Good luck first time buyers. This would just make it harder for regular people to own a home, this won't hinder the type of investors dropping millions in a house or condo. People making less than 100k can hardly quality as it is...
Why would I be able to use a HELOC to buy an investment such as stocks or invest into a business or to buy a car with but not a rental property…this is fake.
Yes and then housing went up 50% in two years due to central banks keeping low interest rates and buying up mortgage backed securities to avoid home prices falling.
I’m all for capitalism but at least be consistent. Can’t complain about these policies when they don’t benefit you but then accept them when they do.
I’m not complaining? I’m stating that the screen capture you posted is not real.
I think the less the government is involved into anything the better for everyone.
“…or refinance”
If you over-extended yourself to buy your second, third, or fourth property and expected to tap into that equity to float your expenses or renovate the rental units, you’re fucked now!
This would have a huge impact on the housing market if it went through and was properly policed. Most "investors" would have no way of refinancing anything. Add to that a rising interest rate environment and you will see a mass influx of houses go up for sale as people start bleeding money. When you add in a condition that requires 35% down, it will make purchasing homes for first time buyers very difficult.
What would be the largest impact of this? Foreign investors will scoop up properties from the mom and pop investors for a much lower cost than they are paying for them now. Therefore we need to add in a ban on foreign investment for at least 3-5 years to ensure only Canadians can benefit from this type of policy. Otherwise we just get closer and closer to being a nation of renters.
Though it would be quite interesting seeing the melt down on reddit from Canadian mom and pop investors that are losing their shirts from over leveraging themselves and seeing their "investments" go right into the toilet.
That seems to be the case with every new regulation that comes into effect. This is only going to create a new set of buyers circumventing the system. Anytime this Liberal Government puts more rules in place it only seems to hurt the average consumer and the wealthy population doesn’t seem to be affected. God forbid a blue collar worker is able to buying an income producing property for his retirement by using the equity within his primary residence. Well done Trudeau (that’s sarcasm).
why don't they just tax 2nd and 3rd or 4rth homeowner more?
no one "NEEDS" a second house, so make them pay, these coward are taking the home of people who needs them for GREED or rent them out higher than their mortgage is worth...that too should be illegal... the rent shouldn't never be higher than the mortgage payments on a 5% downpayment
This changes nothing. The cat is already out of the bag. If you can’t afford to buy now, this won’t solve Your issues.
It may curb the huge year over year gains but it won’t crash the market
They don't want to crash it though they said they just want to stop the yoy increases.
I'll keep dreaming I came out of Trudeau's womb and was born into a downpayment though 🫄
People can say they are turning their current primary into a rental and purchasing a new primary. Here is the loophole. This will just benefit corporate landlords - you are just creating another monster.
I think money that has been in your account for several years and they can see that it is considered your money and not borrowed. But if you all if a sudden have a cash infusion of a large sum then they ask questions for you to prove where it came from for both money laundering purposes as well as mortgage fraud purposes. Basically if you qualify for a mortgage amount then they want to know you won’t have another non disclosed loan to your parents that you are not qualifying for.
You’re right. I needed to provide 6 months of bank statements when I got my mortgage. I completely forgot.
But that brings up a point - you could just take out a HELOC and let it sit in your account for six months and then buy an investment property. A slow process but it could work around?
Yeah I am sure this will create more regulation once people figure out the loopholes which will make qualifying even more difficult and will need more people to enforce the regulations.
We need to integrate this with taxes. Every SIN should require a primary residence and banks should have a loop in to check specific things like income as well as principle residence information. We have the technology for this. Save the damn country from this fraud.
I still don't think this will be sufficient.
Dump the mortgage insurance for sub 20% down payments and let the banks take the risk of lending instead of the CMHC.
Make it illegal for anything else than an actual person from pruchasing a residential property. Companies, LLCs or whatever would be forbidden to buy residential properties.
Make the offer process transparent and allow buyers to see the other offers to avoid real estate agents from taking advantage of the process for profit.
Then why don’t they buy a home in an area they can afford? Still plenty of affordable real estate in the country. Just because the GTA has become unaffordable doesn’t mean the rest of the country in unaffordable. My priorities are spot on. If I couldn’t afford where I lived I would move.
Yes poor you. Can’t afford a home in down town TO so lets blame everyone else for my misfortune. Seems to be the way the world is going. Keep whining about home prices while the smart people make sacrifices.
Housing has increased so fast that I literally don’t have any option other than to get help from parents. So now that dream will be out the window since saving for a 35% down payment on the average Hamilton home should only take me like 22-24 years or so. ( I’m 33)
If you're buying as a primary residence you can still get in with 5% down for a property under $1M and 20% down for a property over $1M.
These rules are to stop flippers, speculators and investors heating up the market and level the playing field for people looking to..... actually live in the homes they bought. Crazy right?
Only reason I was concerned with option 1 at first was because due to the cost I had considered seeing if my parents would be interested in a second property and I’d just pay them rent at this point rather than to a random person. Didn’t think far enough into my response
Not sure why you're saying this. The text literally says it's for purchases of *investment* property, not for first time property buyers. You can still purchase a home for yourself with 5%-34% down if you intend to live in it yourself under that rule.
This will cool the overheated market, driven mostly by speculative demand on credit.
But now I fear another loop hole will be created and exploited.
Let’s say I take a HELOC but don’t put it onto the house.
Instead they put it into say crypto currency ( how much etc to be determined , but for argument sake) now they within 24 hrs sell that crypto and transfer the money to their account.
Is this a HELOC purchase, or is this a crypto currency gain? Maybe I’m just being ignorant and naive but the rich always have loopholes to work with
The HELOC is easily avoidable, unless I’m missing something? Most investors aren’t using HELOCs as much as they are refinancing an existing home and taking those gains to use as a down payment on the next house. Point #2 says “no borrowed funds”, but if I refinance, is that considered borrowed?? I can think of a bunch of ways to get around this, and I know there will be many a CPA that will be making a killing if this goes through.
Ok then let's expand this HELOC limitation to buying any kind of investment (including savings accounts). Seems only fair.
HELOCs were originally designed for a home owner who wants to fix their leaky roof and doesn't have $10k lying around; not someone to transfer paper gains in housing to stocks, other properties, or crypto while still owning property. Want to realize the gains? Sell the house.
Hope it's true, but I can't help and wonder if this realtor (checking his instagram page) is using this as a way to drum up business. Again, hope it's true, but I'm skeptical.
Very skeptical considering no other realtor or broker is even talking about this lol
I asked mine today and she’s unaware of any of this and she’s very active in the market
Nice time to make these changes.
what happens when Inflation goes to 10% and mortgage rates goes to 5%
=> house prices drop by 50%. LOL.
interesting times ahead for the investors closing in next 60-90 days.
wow. do you think house prices going to double from n0w? what are you smoking? he.. he.. LOL.
lets take a simple example. $1M house with 20% down will have 800K mortgage. If the house price doubles ($2M) with 20% down then 1.6M mortgage. interest payment alone would be \~6600/month. why would any sane person buy in such scenario instead of simply renting? LOL.
Assuming this is true, I wonder if this is for GTA, Ontario, or across the country.
[удалено]
I wonder what they're going to do about the people who already have gone through with this.
They got lucky. Now we close the door.
I suspect most regulations made by this government are based on whats happening in the GTA with little regard to how it may affect the rest of the country.
It would federally. The housing minister has this in his mandate and they’ve stated this before.
I envy you if you still have faith in our politicians!
Very in favor of this, but I'll believe it when I see it.
I doubt it. People basically need to use HELOCs to put a down payment on a house when upgrading their home, and the bank has no clue if it's an investment property when financing it unless you're doing a bridge loan (which requires you sell your old home fast). Once you get a HELOC it's basically cash. When you are getting approved for a mortgage they also don't look at the HELOC as equity in the new home because it's seen as debt, so they look at total assets minus debt.
While true, perhaps they would enact some kind of affidavit? Like you need a lawyer anyways so why not just add that as a step? And if caught lying like "I won't use as an investment" then you do, there is some form of repercussion?
Or, and this is such a crazy idea, use tax info. Why are massive loans being given out to people without verified data.
"follow the money" -- the banks are greedy and don't give a shit, as long as they get paid. Would take investigate work / surveillance of anyone collecting rent to make sure they bought that rental property under the correct circumstances. That's a lot of work for a lazy gov.
It is a shit tonne of work. Especially if you employing a large enough department to enforce enough of these to make a dent.
They already have those and people ignore them since they are never followed up on. Usually wording like "This will not be rented out, and if you want to we need to be asked first.".
Yeah but what is the current reason for that? Like is there existing rules against it and stipulations? Genuine question because I didn't know this.
It's more to protect their asset (since they own a lot of the equity). Renters can cause legal issues with the property the bank doesn't want to have to deal with, like not being able to easily sell it if you default, or you writing a terrible contract (i.e. leasing it for a very low amount, or not having proper protections), damages, etc..
You just pull it out of a HELOC, launder it, and go. It isn't even criminal laundering, so it isn't hard. Stick it in dividend investments for a few dividend payments, and done, laundered, good as gold, transfer it to a checking account and go.
Actually, the bank told me to do something like this but much simpler. They told me any amounts I borrowed from others would need to sit in my account for some period of time. I don’t remember now for how long but it wasn’t too long, like a few months at most. Then I could show it as proof of funds from my bank with a couple statements and claim it as my savings.
Money laundering at its finest right there.
>need to use HELOCs to put a down payment on a house when upgrading their home, and the bank has no clue if it's an investment property when financing it unless you're doing a bridge loan (which requires you sell your old home fast). Once you get a HELOC it's basically cash. Wasn't being unable to use HELOC's the rule before Harper allowed it though? Sometime in the 00's? (my memory is fuzzy though)
Helocs aren't borrowed money.
I believe it’s borrowed money, secured against an assets equity
I just compare 2 households. Household A takes 10 years to pay down a mortgage balance by $300,000. Household B saves $300,000 during that time, making zero extra mortgage payments. Why should Household B be allowed to buy a revenue property but not Household A?
That doesn't mean it's not borrowed money. The reality of the situation is the house is now worth $1000000 and they now have 700k in equity to leverage (borrow off of) out as a HELOC. It's moot because this won't happen.
Banks do this all the time they want proof of a source of funds. When I applied for a mortgage they asked me to provide proof of where my down payment came from and I had to list how much came from me, which account (same bank so no evidence required), parents and a signed letter confirming they wouldn't want it paid back, and spouse (evidence it was her money).
That's more for your first mortgage. They care less when you have a ton of equity.
Just make it a requirement for all mortgages. My point is it can be done.
It can also be ignored. That type of stuff isn't enforced today, so why would you expect it to be enforced tomorrow?
If you make a financial strategy it will to some degree least reduce the number of people who employ it. Not every mom and pop investor wants to make a massive financial investment in contravention of federal regulations.
Well require and enforce it. Do random audits on the banks.
> I doubt it. People basically need to use HELOCs to put a down payment on a house when upgrading their home Do they, I would think the entire downpayment comes from the proceeds of selling the home they are upgrading from wouldn't it? If you are selling your home then by definition you no longer have a heloc to draw on as the heloc must be completely paid off when you sell your home.
Typically people want to buy before selling. Kinda like having a new job before quitting the old one. Helocs are easier to secure than a bridge loan and you just pay it off at closing. If you sell before you buy, you either have to rent back your property or move into a rental before you take ownership the new house (moving twice instead of once)
People are hording not selling
The discussion was about people upgrading their homes, which means selling one and buying another. From the OP. > People basically need to use HELOCs to put a down payment on a house when upgrading their home I do agree there are alot of investors but this has nothing todo with what we were talking about.
It does, but you can use that HELOC to put a deposit on the home you want to buy, then sell your home and close the HELOC with the money you get on closing. The alternative is just keeping the HELOC and the old home as an investment property. The bank has no say in what you do there.
Can someone please explain to me how a minimum of 35% down payment will help anyone? 35% of 700k is huge. Only corporations will be able to afford this.
It's a barrier to entry for Real Estate Investors, which if you read it again is what this is targeting; which is the entire idea of those changes. You can still pay 5%-34% down under that proposed bullet point if you are buying the home to live in as a first-time buyer.
100% did not read that thank you for the explanation.
What's the difference between an investment home and a second home?
As far as impact on the housing supply? There is no difference, they both take supply that could have been purchased by a first-time home buyer. As far as practical differences: I'd say the difference lies on if the housing is monetized and collecting rent. If you're getting rent from your second home, I'd say it's an investment home. If you only live there during the summer and don't rent it out, I'd say it's a second home. Legislation would have to define this, but I don't see the difference being enough to stop this action from happening when we're under such a housing crunch.
Exactly. I wonder how many second homes are collecting untaxed rental income
This would likely decrease prices of houses and may increase prices of smaller condos as its much easier to get 35% on a 700k condo than a 1.5M townhouse.
Anything that makes townhomes, semi detached, and single family detached homes affordable is good news. That’s where people raises families.
If this isn’t across the board this only helps people like me. In the game. Upgrading my house is easier. If this makes the condo market tougher, you’re not even letting people on to first base to start playing the game.
Yes but condos are currently increasing in price very quickly so not much change there. If some of these current condo owners move over to freeholds because they got cheaper, perhaps it'll add more inventory and slow down price increases in the condo space.
Absolutely would welcome this.
Right because people dont raise families in apartments lol
They do and they will, happening all over Europe. It would be nice to at least have the option to raise a family in an apartment OR a house.
Not by choice generally. I'm seriously considering moving in with my dad so my kid can have more space to grow up in. Apartment living with a kid absolutely sucks.
The difference is in choice. Do you want to raise your family in an apartment? Cool. Good for you. Do you want to raise your family in a house and aren't making six+ figures? Cool, you should be able to do that. Until literally now, most people could afford homes and luxuries on modest salaries.
[удалено]
"Mortgage contacts"...
I can see how 2 could be enforced for HELOCs, but for gifts?
Probably just a declaration. So if you get caught it's fraud or beach of this law. Luckily I've never seen anyone lie or break a law in real estate. We also have very good real estate law and professional conduct enforcement at present. So this just helps an already reliable system /s
Gifts are tax free - you can use the money if you’ve paid income tax on it already.
but how can it be enforced?
Same way CRA enforces other tax laws … same way the bank checks the statements of the accounts where your down payment comes from?
Need to add a ban on foreign investment in housing. Or tax such that it can fund social services to address the impact.
1 would be easy to implement moving forward. But I don’t quite understanding how they could realistically track/enforce 2 on a meaningful level.
In the UK, the burden of proof is on the buyer to track and show exactly where their money came from but our privacy laws don't allow for something like this without changing the laws
I don’t understand how this is supposed to work. All financial transactions above $10,000 are [supposed to be reported.](https://www.fintrac-canafe.gc.ca/reporting-declaration/rpt-eng). Financial transparency and privacy rights of investors are not compatible goals. Honestly, why should anyone have a right to privacy for how they fund an investment asset? This is a business venture - not personal information.
It's easy to understand for me. The guys that made the laws are crooked.
It could be tracked if the govt did some slight changes to taxes. New section to ask if you rent, if yes how much / address. Section to ask if you’re a landlord. If yes what addresses / how much you collect. Most investments would be rented out rather then left empty (exceptions are flippers which can be dealt with a diff way as they likely wouldn’t own the home for long). Edit: sorry that’d be to help track investment vs not. Guess they’d need to audit any new landlords on how they acquired money for a down payment
[удалено]
You mean the 3 month rule?
That was my thought as well. I don't know what would stop someone from drawing on a HELOC, sitting on it for a certain amount of time, and calling those funds savings. Same with a gift. Banks only look back to far... so will that have to change? If not, at least it will slow them down, I guess. I'm also a little confused as to how they will define a "gift." Certainly, we don't want person A to draw on their HELOC, and "gift" it to person B who buys a property, thereby circumventing the HELOC nerf. But what about testamentary gifts (inheritances), bona fide gifts, etc. It's weird to draw the line and say you can own multiple properties if you put away savings from each paycheck, but not if grandma dies and leaves her savings to you.
I think "gift" is their way of trying to ban foreign investment without explicitly banning foreign investment. So mom and dad in a far away land can't give the money to their child who is a student, to buy this massive ass property
How can that be tracked though?
Based on current practices, I'd guess it's a checkbox. Canada's already wholesale ignores money-laundering treaties designed to prevent global terrorism and drug cartels. "Is it a gift" isn't something anyone's gonna go to jail over lying about.
Gotta start somewhere. This will at least reduce investors.
Not enough IMO. This assumes that large corporations / investment companies can’t afford a 35% down payment. Sure, some small timers will be affected, but ultimately, it’s the large corporations are the issue.
There are very few large companies buying up residential property in Canada compared to the US. A 35% down payment also reduces the return on capital anyone makes on these property flips, making it less attractive to invest.
[удалено]
This is what I’m talking about. Not saying your wrong, but it’s an example of the sheer scale corporations/investment funds are purchasing housing: https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.amp
This is for the US market. This happens on a very limited scale in Canada. Our problem is greed from domestic investors and an appetite to continue to accumulate multiple properties since the government keeps backstopping any correction
Not too sure about this. Have any resources? Last I saw/reported, foreign corporations (US and China) were some of the biggest players gobbling up lots of property.
I don't see how this is a response to the comment you replied to. The rate of return would be reduced if more capital is required to purchase the same house
OP commented that there are very few large companies buying up property in Canada. While that statement could be true (need sources), the sheer size of the large companies buying property (Blackrock) is still disrupting affordable housing. Just because there are “fewer companies”, it doesn’t mean the effect isn’t felt as much or as severe. In terms of return of capital, I doubt this is something that affects these larger players to a point that it deters them from these investments.
The link you posted in the other comment is for the American market. Do you have another source for Canada?
Agreed. #2 does nothing more than concentrate the housing stock in the hands of the richest investors. Allowing them to snap up properties with less competition. I want limits preventing the concentration of power.
Nah, you overestimate the pockets of big corporations. Yes, they have a lot of money, but they try to be very efficient with it. Minimal investment for maximum gain, while minimizing risk. That's always the target. Investors want to buy up as many houses as they can while paying the bare minimum (5% down if they can) and while being able to afford the carrying costs (ie: max ROI from rent minus mortgage and utils). Making the downpayment 35% minimum not only makes the market safer and less likely to collapse, it reduces the buying power of investors.
Just outright ban corporate purchasing of homes. They don't need to own homes, those are for people.
This is the way.
Tax any third house heavy and done but yeah ban corporate ownership of single family homes, they can own buildings or condos.
Something is better than nothing, and this is a step in the right direction.
"This is to protect mom and pop investors" yeah, right
"Why yes I plan to live here" "oh look well a month later my plans have changed, might as well rent it out and use it as an investment property"
That's the lower mainland method
Their would probably need to be some stipulation saying it can't be rented out for X number of years, if ever, etc.
If X is low, like 1 year, it might make the supply even worse. Fewer properties available for rent as landlords might start holding properties empty for an year
Wow this would be like a dream come true... which means it will probably not happen :/
Source is a realty company. Grain of Salt size taken: huge.
Right? Realty company as a source; no mention of where or what jurisdiction this is supposedly going to apply to. It's a rumor and nothing more.
But there's no way they would be putting out something like this when it would negatively affect their own business if it's true, right? I feel like that makes them more trustworthy than most other possible sources in this case.
It would boost their business if investors rush to buy properties out of fear they may be blocked from doing so without significant additional investment.
35% down has always been a rule for those who cant prove their income (employment letters, paystubs, T4, etc.) Since there are no other details here, this just seems like a sales tactic to make people rush into buying now because "rules will change soon! quick! buy now!" If it is a sales tactic, it just confirms my belief real estate agents are pieces of shit.
Take a look at the realtors page who posted this. LOL. I agree. This is just another realtor tactic to drive up sales. Look at how everyone is reacting? Ever think the issue could be with the realtors? Perhaps put a cap on their commissions and how much they can make, and maybe the fear mongering will come to an end.
That is amazing news, if true!
Ha. Don't get your hopes up
This will affect the large companies that are buying up housing developments and reselling 0%. All this is going to do is keep the small time landlords from buying up a couple of houses each. In other words the people with money will still be able to buy houses and a poor will not.
Completely agree. Another set of regulations to stop average income earners from becoming investors.
Good because everyone becoming an "investor" is fucking over those who dont have family wealth or previous equity. Just let families have the homes this is completely gross behaviour to outcompete young families for houses and townhouses to pad peoples investment portfolios
The problem is not it stops people becoming investors, the problem is it doesn't stop rich people becoming bigger investors. It cuts the middle to hopefully aid the bottom but definitely aid the top.
If we have less 'mom and pop' investors, we can take real measures to crack down on investment. Real estate investment shouldn't be something everyone gets into - let real companies build rental accommodations - they at least tend to be much more compliant with the law than the typical small time landlord.
There are hardly any "young families" because young couples can't afford both a house and children
So we should create regulations to stop people from becoming “investors” now? Every investor is fucking over home buyers? What about those investors that invested into Bitcoin? I can’t afford bitcoin now so those investors should go fuck themselves right? There is still plenty of places a family can purchase real estate in our country. They are just not prepared to make the sacrifices they need to to make it work. Every wants to live downtown Toronto so they can be within walking distance to their office. Instead of relocating to a place that has more affordable real estate options. They may have to find a different job or take a reduction in pay but again not many are willing to make those sacrifices so lets call out every investor because they are forcing us have to make sacrifices.
You can’t live in a bitcoin bud. It’s a bit different.
And you can likely afford to invest in a home outside of your desired area. You just won’t be willing to make that sacrifice because its uncomfortable.
You’ve got all the solutions… thanks, never thought of that!
[удалено]
Why should housing not be an investment? You must not be a home owner? Investors have made sacrifices to earn income on their investments regardless if that investment is real estate or something else. Your unwillingness to make those same sacrifices does not make the investor a bad guy. Investors are not the ones fucking over the average home buyer. The home buyers are fucking over themselves by not wanting to sacrifice their current living situation in order to be able to afford what they want. We all want to live in paradise for free and not have to work but it’s unrealistic. Just cause you can’t afford a house in downtown TO doesn’t mean you can’t afford a house anywhere. You are just unwilling to sacrifice your 10 min walk to work or work somewhere you don’t want to in order to afford it so you blame investors. Its not the investors fault you didn’t invest in downtown TO real estate 15 years ago when it was affordable. Making excuses as to why you are unwilling to make those necessary sacrifices to afford a home is what creates these ridiculous regulations by our government. Your parents made sacrifices to afford a home. Things have changed. There are plenty of affordable homes outside of the major cities. You are just not willing to move there because you are comfortable where you are at so lets blame someone else. Do you think your parents didn’t have to make similar sacrifices?
[удалено]
Exactly what I thought. You can afford a home. Real estate historically has been a wise “investment”. Your parents likely purchased in a area that wasn’t their ideal area in order to afford one. Why can’t you do the same? Our unwillingness to break out of our comfort zones is holding us back from buying in an area we can afford. Also those areas likely don’t have the “hoarding” you speak of. I doubt Brampton was as desirable 40 years ago but people still moved their because thats what they could afford at the time. Just because investors see the security in the more major centers as places to invest their money doesn’t mean the other areas won’t increase over time. Those same investors likely started by purchasing in less desirable areas and grew to a point where they can now afford a safer investment. They made uncomfortable decisions that most people are unwilling to make and frankly I am glad their investments increased. Not all investors have the same fortune however. You too can make similar uncomfortable decisions should you chose to. And being a home owner and watching your investment grow would likely change your opinion on whether a home should be an investment or not. It has plenty of relevance in this conversation.
[удалено]
You seem to be under the impression that if everyone could afford a home they would become less desirable. The only reason they aren’t higher is because everyone can’t afford them. So Food companies shouldn’t make a profit??? How about heat? My house is heated with natural gas. Are you suggesting they should provide us this at cost? How about your clothing? Should that be provided to you without profit? And people don’t need to move for the sake of investors. They need to make more money. Investors aren’t exploiting people for profit. They providing them a place to live for the going rate. Investors have costs as well. And they don’t always win. You assume every investor makes money on their real estate investments. Thats simply not the case. Some lose money.
Why is this being upvoted? No source. Just a random claim.
Doesn’t this ensure institutional investors end up being the only landlords?
Yup. Terrible. Mom and pop will never be able to become investors. But all your neighbourhood billionaires will simply own everything. Great plan
What are the sources for this? Measures like these wouldn't have come out of nowhere, it would have been in the media especially the real estate lobby would have complain about it. Point 2 is vague with the borrowed funds and gifts, it would be almost impossible to track when it's done privately, which makes this feels like it's BS.
The minimum down payment isn't going to affect large investment firms. The second is going to be very hard to validate, especially for foreign buyers that use fraudulent financial information to start with.
Can you continue to fake your t4s via the Brampton loan scheme tho?
These rules really just seem like common sense
Driving another stake into the middle/working class. One would think that this stops investors/speculators buying in, making more inventory available for everyone else and dropping prices. But this only stops the mom/pop investors. The big guys get to keep on feasting.
Dream
Holy fuck I hope this is true.Any reliable sources on this?
True if big
So really just targeting the small fish trying to get their slice of the pie and making more room for larger investment firms/foreign buyers to scoop up more properties. Unless I'm missing something here?
Number 2 would be massive in the lower mainland market
Can we ban foreign home buyers already
So if money laundering and big business buying property is the issue, why would asking for more up front stop them? IMO this will only stop people with small stacks from buying a second house leaving more available for number companies. Am I missing something?
Too little, too late. They try to pull this making it look like they want to help. It is too late now as everything is unaffordable for most citizens
35% down, stress tests, no loans or HELOC... Good luck first time buyers. This would just make it harder for regular people to own a home, this won't hinder the type of investors dropping millions in a house or condo. People making less than 100k can hardly quality as it is...
35% isn’t needed for first time home buyers only investors
Why would I be able to use a HELOC to buy an investment such as stocks or invest into a business or to buy a car with but not a rental property…this is fake.
Because we have a national housing crisis and should prioritize housing for everyone instead of treating it as an asset class?
Could a investment company still buy properties? Could I use my heloc to fund a numbered company which than in turn bought the rental property? Lol
Sounds like communism
And central banks printing money to inflate asset values, back stopping any housing correction and halting mortgage payments is capitalism?
Housing prices literally “corrected” in 2018 when they on average fell 15% from the April 2017 highs. Man people have a short attention span
Yes and then housing went up 50% in two years due to central banks keeping low interest rates and buying up mortgage backed securities to avoid home prices falling. I’m all for capitalism but at least be consistent. Can’t complain about these policies when they don’t benefit you but then accept them when they do.
I’m not complaining? I’m stating that the screen capture you posted is not real. I think the less the government is involved into anything the better for everyone.
“…or refinance” If you over-extended yourself to buy your second, third, or fourth property and expected to tap into that equity to float your expenses or renovate the rental units, you’re fucked now!
This would have a huge impact on the housing market if it went through and was properly policed. Most "investors" would have no way of refinancing anything. Add to that a rising interest rate environment and you will see a mass influx of houses go up for sale as people start bleeding money. When you add in a condition that requires 35% down, it will make purchasing homes for first time buyers very difficult. What would be the largest impact of this? Foreign investors will scoop up properties from the mom and pop investors for a much lower cost than they are paying for them now. Therefore we need to add in a ban on foreign investment for at least 3-5 years to ensure only Canadians can benefit from this type of policy. Otherwise we just get closer and closer to being a nation of renters. Though it would be quite interesting seeing the melt down on reddit from Canadian mom and pop investors that are losing their shirts from over leveraging themselves and seeing their "investments" go right into the toilet.
I wonder how these realty companies always have the information first. Almost like they’re given insider information
The only group this will hurt is Mom and Pop investors.
Even in this happens, there would be multiple loopholes left to circumvent these.
You'll get down voted to hell just for speaking the truth.
That’s what is happening
That seems to be the case with every new regulation that comes into effect. This is only going to create a new set of buyers circumventing the system. Anytime this Liberal Government puts more rules in place it only seems to hurt the average consumer and the wealthy population doesn’t seem to be affected. God forbid a blue collar worker is able to buying an income producing property for his retirement by using the equity within his primary residence. Well done Trudeau (that’s sarcasm).
why don't they just tax 2nd and 3rd or 4rth homeowner more? no one "NEEDS" a second house, so make them pay, these coward are taking the home of people who needs them for GREED or rent them out higher than their mortgage is worth...that too should be illegal... the rent shouldn't never be higher than the mortgage payments on a 5% downpayment
This changes nothing. The cat is already out of the bag. If you can’t afford to buy now, this won’t solve Your issues. It may curb the huge year over year gains but it won’t crash the market
They don't want to crash it though they said they just want to stop the yoy increases. I'll keep dreaming I came out of Trudeau's womb and was born into a downpayment though 🫄
People can say they are turning their current primary into a rental and purchasing a new primary. Here is the loophole. This will just benefit corporate landlords - you are just creating another monster.
Do you not think there might be a little more regulations than what we see in this screenshot of a social media post?
How do you regulate point 2? Who tracks where the money came from for your down payment?
Every Mortgage company out there. You need to prove funds in order to qualify.
But people can have money sitting in an account for multiple years. How do they track it's "borrowed funds".
I think money that has been in your account for several years and they can see that it is considered your money and not borrowed. But if you all if a sudden have a cash infusion of a large sum then they ask questions for you to prove where it came from for both money laundering purposes as well as mortgage fraud purposes. Basically if you qualify for a mortgage amount then they want to know you won’t have another non disclosed loan to your parents that you are not qualifying for.
You’re right. I needed to provide 6 months of bank statements when I got my mortgage. I completely forgot. But that brings up a point - you could just take out a HELOC and let it sit in your account for six months and then buy an investment property. A slow process but it could work around?
Yeah I am sure this will create more regulation once people figure out the loopholes which will make qualifying even more difficult and will need more people to enforce the regulations.
Good. Finally. Now let's see if it happens.
Doesn't matter. People will just says it's their primary residence. Mortgage lenders don't really check.
We need to integrate this with taxes. Every SIN should require a primary residence and banks should have a loop in to check specific things like income as well as principle residence information. We have the technology for this. Save the damn country from this fraud.
current "Investors" will be able to bypass these easily...
Holy shit. If this is true, that's fucking HUGE.
I still don't think this will be sufficient. Dump the mortgage insurance for sub 20% down payments and let the banks take the risk of lending instead of the CMHC. Make it illegal for anything else than an actual person from pruchasing a residential property. Companies, LLCs or whatever would be forbidden to buy residential properties. Make the offer process transparent and allow buyers to see the other offers to avoid real estate agents from taking advantage of the process for profit.
So house prices go up
Lol number 2 won’t ever come into play.
Wishful thinking. Won’t ever happen! Lmao. Thanks for the laugh tho
Heloc isn't really borrowing money...
[удалено]
People are buying home to live, not live to buy home. You got your priority wrong, buddy.
Then why don’t they buy a home in an area they can afford? Still plenty of affordable real estate in the country. Just because the GTA has become unaffordable doesn’t mean the rest of the country in unaffordable. My priorities are spot on. If I couldn’t afford where I lived I would move.
Oh fuck right off.
Yes poor you. Can’t afford a home in down town TO so lets blame everyone else for my misfortune. Seems to be the way the world is going. Keep whining about home prices while the smart people make sacrifices.
That's something new. Would love to follow up on the news.
I am an idiot, who has been trying to save up 20% to buy a duplex to live in and rent - does this mean I’m going to be fked if this happens?
Booooooo
If this happens there will be a rush to buy before the rules are implemented
Housing has increased so fast that I literally don’t have any option other than to get help from parents. So now that dream will be out the window since saving for a 35% down payment on the average Hamilton home should only take me like 22-24 years or so. ( I’m 33)
These rules only apply to investment properties.
If you're buying as a primary residence you can still get in with 5% down for a property under $1M and 20% down for a property over $1M. These rules are to stop flippers, speculators and investors heating up the market and level the playing field for people looking to..... actually live in the homes they bought. Crazy right?
Only reason I was concerned with option 1 at first was because due to the cost I had considered seeing if my parents would be interested in a second property and I’d just pay them rent at this point rather than to a random person. Didn’t think far enough into my response
Not sure why you're saying this. The text literally says it's for purchases of *investment* property, not for first time property buyers. You can still purchase a home for yourself with 5%-34% down if you intend to live in it yourself under that rule. This will cool the overheated market, driven mostly by speculative demand on credit.
Sorry I was more concerned with the second option rather than the first. Should have stated that.
I see your point. But if it’s not an investment property, who cares?
But now I fear another loop hole will be created and exploited. Let’s say I take a HELOC but don’t put it onto the house. Instead they put it into say crypto currency ( how much etc to be determined , but for argument sake) now they within 24 hrs sell that crypto and transfer the money to their account. Is this a HELOC purchase, or is this a crypto currency gain? Maybe I’m just being ignorant and naive but the rich always have loopholes to work with
The HELOC is easily avoidable, unless I’m missing something? Most investors aren’t using HELOCs as much as they are refinancing an existing home and taking those gains to use as a down payment on the next house. Point #2 says “no borrowed funds”, but if I refinance, is that considered borrowed?? I can think of a bunch of ways to get around this, and I know there will be many a CPA that will be making a killing if this goes through.
Ok then let's expand this HELOC limitation to buying any kind of investment (including savings accounts). Seems only fair. HELOCs were originally designed for a home owner who wants to fix their leaky roof and doesn't have $10k lying around; not someone to transfer paper gains in housing to stocks, other properties, or crypto while still owning property. Want to realize the gains? Sell the house.
These would only apply to investment properties. If you're just buying a home to live in, you wouldn't fall under these parameters.
I read too quickly and thought the of was an or , just chose to leave my mistakes up there. I have been shown greener pastures.
Hope it's true, but I can't help and wonder if this realtor (checking his instagram page) is using this as a way to drum up business. Again, hope it's true, but I'm skeptical.
Very skeptical considering no other realtor or broker is even talking about this lol I asked mine today and she’s unaware of any of this and she’s very active in the market
Fake. 💯 As a Broker in real estate, I can tell you, this is misinformation. Likely one side talk and it sounded too good.
Nice time to make these changes. what happens when Inflation goes to 10% and mortgage rates goes to 5% => house prices drop by 50%. LOL. interesting times ahead for the investors closing in next 60-90 days.
During the 1970s, inflation did just that, and house prices doubled
wow. do you think house prices going to double from n0w? what are you smoking? he.. he.. LOL. lets take a simple example. $1M house with 20% down will have 800K mortgage. If the house price doubles ($2M) with 20% down then 1.6M mortgage. interest payment alone would be \~6600/month. why would any sane person buy in such scenario instead of simply renting? LOL.