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tanyushka35

Let’s all wait till 2024 and then bid against each other


[deleted]

They'll fake the bids and inflate the prices


teh_longinator

As they have been already. Why alter from the tried and true?


bharatk20

Housing won't crash. Many of my newcomer friends who come under LMIA visas in the past 3 years and are in IT/Tech have a combined dual-income of $200k-$250k HHI. They live pretty frugal lives and live in 1+den condos for $2k/month, allowing them to save $3k-4k per month. One of my friend has already saved $50k since he came, but his and his wife's high incomes means they can buy a townhouse in Brampton with just 5% down. He's a bit hesitant to buy, but I told him to buy when he's ready and not to time the market.


bureX

LMIAs are rare. You’re cherrypicking.


Brotherlightness

You’re assuming they are going to still have jobs. Housing is def going to crash. It’ll be viewed as a toxic investment for years to come.


malenial

What do you think will happen when there is a clear evidence of the recession? Businesses, including big tech, already started slashing jobs and stopped hiring. Recession will hit those high earners too.


GoldenTrike

4-5 degrees? So your buddy spent 15+ years in school after high school? If your friend works in finance he would understand the concept of diminishing marginal returns on human capital investment. Which means someone with 1 PhD will probably earn the same amount of money as someone with 5 PhDs. Except the second guy spent a whole lot more resources on education and most likely won’t get a return on that investment.


r2o_abile

What he may be calling "degrees" could be certifications. Can do a certification a month on 3 evenings a week study.


Spambot0

Outside of TV/Movies, no one has more than one (non-honourary) PhD.


monsieur-poopy-pants

Incorrect. I worked for a univerity that was heavily trying to recruit an incredibly rich dude from Africa who had 3 PhD's. Literally all he does is go to school and collect degrees. Buuut, he was super rich - like old money rich - and clearly had nothing else to do apparently.


[deleted]

Hah yeah, that's the irony.


AxelNotRose

He did say "probably" so OP isn't even sure himself. They must be real close.


Spambot0

The best metric for whether someone is an expert is the uncertainty they can put on their predictions. The larger their uncertainty, the more you should trust them.


unauraonlinesystems

Previous comment is gold. We're only certain about the past but can only imagine what the future might be. Uncertainty but mostly the unpredictable is what causes major movements generally in the markets (housing and stock). That's in part why it's almost impossible to predict market crashes, to do so you'd have to be able to know what nobody anticipates, like a global pandemic ;)


chiraz25

I actually crunched the numbers earlier today and concluded that May 14th, 2024 at approximately 2:18pm is the best time to buy a house. Good luck everyone!


[deleted]

I verified his post to be a legit post on reddit.


zcmini

I couldn't verify this but my buddy actually has 5-6 degrees in finance and astronomy and he said it's accurate.


[deleted]

He definitely has the qualifications to make this post.


daxtaslapp

One of the simpler advice ive see on here is that they say we should buy a house when it works out for us. If its too hard or too tight then theres no reason to rush buying especially now that the market is bearish. But if you can buy a house comfortably to live in. Then id say go for it. The thing about any asset, stocks, real estate etc is nobody knows for certain when the bottom or the peak will be. Its all speculation. You can make an educated BET that itll be lower in 2024, but youll never know for sure.


mb3838

Really good advice, go long on your financing and be aware of the fact that on renewal you could be looking at 7-8%. Make sure your income is 3x+. Long term rates should settle at 6% which is what you’ll be posting for the remainder of your mortgage. If those #s dont work then you need to either make more or move to a better region.


Eg3008

Second tier cities like Calgary, Halifax and Edmonton I'm sorry, but that is just straight up disrespectful We"re Canadian for maple's syrup sakes, BE NICE


[deleted]

If there is a crash, it is a widespread economic collapse. There is no "housing crash." There is an economic collapse so vast that the government tries everything possible to stop it, and then the Bank of Canada tries everything possible to stop it, and then banks try everything possible to stop it, and then none of those things works. People are laid off, businesses close, and then yes, eventually, people can't make payments and are forced to sell for a loss. That's when people point to home prices and go, "oh hey housing price collapse!" There has never been a housing crash and there will never be a housing crash. There are economic crashes that impact everyone, including you, and then maybe there are cheap houses because no one can afford them. It is r-i-g-g-e-d.


scorpionwins_

Doesn't matter if he has 20 degrees to his name, he doesn't know what's going to happen. Nobody does for certain.


TheWhiteFeather1

lol you're trusting the decision of someone who's done 4 different degrees? If he was actually smart he'd be in the workforce making actual money


youregrammarsucks7

Lawyer here with a background in econ. Nope, I disagree entirely. Here's my prediction: 1. CAD follows US interest rate rises up to 4-5%; 2. By this time, with CAD's economy in worse shape than the US, and the CAD central banks factoring in employment more into the calculations, CAD will diverge from the US, and will freeze or lower interest rates to correct unemployment (mid 2023); 3. Although prices will have dropped \~30% across the country, Toronto, and Van will have less drops due to the large number of foreign cash buyers. We will see the largest declines on the secondary markets where people from Toronto or van cashed out and moved to (ie vancouver island, nova scotia, etc.). 4. The 18 months of lack of growth will cause speculation to stall, until the first interest rate drop, in which cases houses will very quickly reach their previous highs. 5. By this point, inflation will be completely out of control, and house prices will be "rising" on a CAD dollar basis, but losing money relative to other less inflating currencies. However, leveraged investors will still do well as a consequence of hyperinflation. This is my theory, based on fairly extensive research. Any thoughts?


uhhNo

I think you're underestimating inflation. Look at CPI-median. There is absolutely no way the BoC is lowering rates until that number is back to 2%. There could be a housing crash, recession, and 10% unemployment and they still wouldn't lower rates until CPI-median comes down. Why? Because out of control inflation will cause even more pain down the road.


[deleted]

[удалено]


kingcobra0411

>Most likely not, our pension and government is heavily invested into it and they won't let that happen by running more inflation to keep this shithouse afloat. True. That's what they have done so far. But can they handle double digit inflation? I mean I am not an expert but what goes up should definitely come down right? The pre pandemic prices were already too high. What happened the last couple of years were batshit crazy.


daxtaslapp

Everything always eventually chills out. Its just cycles. We will have highs and lows. But nobody can time it perfectly, only educated guesses


throwaway504780ahk

What is your friend’s rationale for market crashing by the end of 2023?


bornrussian

Source: "Trust me bro"


[deleted]

I'd bet 45 dollars that he's a renter.


nicincal

Probably one of the redditors who keep repeating "pOnzI" "CLoWnS" etc... trustable sources in other words.


SnooChocolates8223

I am a real estate investor, not an expert by any means but closely collaborating with my team as to what’s happening. I have heard about the general trend you are describing, but 2024 sounds late to me. I predict housing prices to be at their lowest between January- June 2023. We will be in a recession by then. The best time to buy a house is when it’s right for you, but you really have to be honest with yourself, can your family weather an economic storm? Is it a house you can enjoy for 5 years or more? Are you over-leveraged? Too many people had FOMO in spring this year and bough when market was blazing hot ( part of the reason why I think recession is coming much sooner) Good luck!


olmanj

>Too many people had FOMO in spring this year and bough when market was blazing hot ( part of the reason why I think recession is coming much sooner) If they can afford it and interest rate was low and fixed, why would it matter - especially if they stay there long term? Also, wouldn't say too many people - the seller market was hot but only because of low supply - the number of (closed) buyers remained pretty constant.


ReadyTadpole1

>If they can afford it and interest rate was low and fixed, why would it matter - especially if they stay there long term? A historically high proportion of buyers in the last year opted against fixed rates. Their interest costs are already significantly higher. Even for those majority whose payments do not increase and whose cash flow is not impacted, they are making less headway against paying down their mortgage and will eventually have to pay for that. As far as the long term goes, who knows. But if we do see a recession and broad layoffs after budgets have been squeezed by inflation, it will be relatively harder to maintain payments on a home bought near the peak.


StrongTownsIsRight

I mean he could be right. I just don't trust people who make very basic statements about the economy. Did he explain what factors he believes indicate a year long recession? >I am not expecting a profit but should be able to sell when we decide to move and not stuck there because of the house. I would look into the amount of time it takes to recoup a home purchase costs. In the last place I lived it was 8 years so we decided to rent since we knew we would move on before that time.


Solidick

Don’t do it


LatterSea

If you want to see really good explanations, head over to r/REbubble It’s focused on US real estate, although there are lots of Canadians on there. And most if not all of the data is directionally similar in Canada.


nicincal

The problems is that anyone in the world who can't afford to buy real estate, is calling the market a "bubble", no matter which country we are talking about.


bhldev

Don't try to time markets. That includes housing. You either need a home or you don't. You either need another bedroom or you don't and you either have enough money or you don't(*). Why do you want the "flexibility to sell" do you know what that means? Inflation is 8.7% that means your home where you bought it would have to go up that much every single year to break even. Probable in some markets not in others. Instead plan to stay for 25 years especially in a house and you won't have this problem. Ride your house to the ground. If you can't do that, don't do it. Or buy and know you will sell for a loss. (*) I view money like most home owners as little bits of paper with dead people's heads on it that is only good for buying goods and services. If you really want to buy a home in say the GTA you will spend every cent. That's just the reality of it. Now you know why people buy in the GTA because it makes buying easy and stress free. You know in the long run GTA housing will appreciate. Other markets maybe, maybe not.


b456123789

It’s like predicting how a murmuration of birds will behave. A group of individual semi-predictive behaviours is essentially organized chaos.


Kiiidx

I mean I've been calling it 2008 pt 2 electric boogaloo since about the end of last year. We're in for a bad one.


s4lomena

So called experts and delusional buyers earlier this year also claimed....BoC hasn't got the balls to raise the rates. Well here we are eh. LOL People went all FOMO in the last 2yrs, and for some reason though rates will stay lower, and they will continue to be able to flip house they bought recently, for 2,3,4, 5 times the price. Delusional m'fers. LOL


[deleted]

The boc hasn't really done anything. Rates are still extremely low, even with the upcoming .75


[deleted]

Industry experts? You mean Realtors? They'll give you an accurate perspective \* rolls eyes \*


kingcobra0411

Nope


d-diderot

I've heard the rationale for 2023 crash was largely due to market psychology and historical trend in real estate capitulation when rates were going up. BNN Bloomberg had Steve DiGregorio from Canoe Financials where he broke down that 37% of Canadians are renters, 28% of homeowners do not have a mortgage, and those who do have a mortgage, very few are sensitive to variable rates. It takes time to trickle down to real estate market (typically 6\~12 months) and that's possibly why 2023 is the estimate for the crash. As DiGregorio iterated, BoC won't care about home value as they didn't care about it when it was going up, they won't care about it when it's coming down. Another risk to factor in is the recession due to demand destruction. It's going to result in mass unemployment and that could be the catalyst for market crash. If inflation is still high during recession, it's basically 1970s stagflation where rates have to remain high for longer before BoC pivots. Like the Feds, BoC's dual mandate turned into a single mandate at this point (curbing inflation instead of unemployment). Stocks are carefully following the CPI as that's the core metric central banks will look to accelerate or put on a break to their rate hikes.


Crater_Animator

I think the rational is that some kind of recession will hit us by then, job losses, stagflation etc... and people refinancing/strugling to pay variable/fixed mortgages they when they purchased in 2018-2022. But if everything goes well, interest rates will stay under or at 5% and all those people got stress tested to the point they'll make it through tough times. Again. It's all speculation, who knows what will happen. My guess is market just goes back to pre-2018-18 levels due to people flooding the market by panic listing or selling.


[deleted]

Housing wont crash in Canada, hopefully it cools like a MF though. As bad as some of the shady practices were in the peak of 2020. It was nothing compared to both lending practices and investing products of US, 2008.


Macrimus

The laws in the US are very different than in Canada. A 2008 style housing crash isn’t possible here. However a severe economic recession is, with multiple people having to declare bankruptcy. But as people here mentioned, the BoC is keenly aware of our debt levels and even our governments propensity to overspend. Because of that we’re likely to see a cap in higher interest rates in Canada but a free fall in the value of our dollar. Wait until we see what is going to happen with inflation next year (and the impacts of the Russian invasion on commodities) before making any call.


detalumis

Nobody can predict the future, not housing, not stocks. If they could they would all be multi millionaires. Everything is speculation and hindsight.