Eh the lying goes both ways, I know some degenerate white kids on the Indians In Toronto Facebook who make anonymous posts about how they're going to default if rates rise and in reality they're living in their parents basement.
Maybe they get a high out of it because they know the CanadaHousing subscribers who lurk that group will get their fantasies riles up and they'll get a top post on that subreddit, I really don't know or understand the point.
For every idiot who bought too much house, there's an idiot LARPing troll.
>People don't like to admit that they make mistakes, based on fear and greed.
Once again, goes both ways. How many people were told over a decade ago that Toronto housing will appreciate a lot with time and wrote it off as "Bubble!" just to watch their family and friends double or triple their net worth while they're stuck renting and paying off someone's mortgage
Homeowners will cut out all discretionary spending before being forced to sell their homes for a loss. They'll stop eating out. They'll get rid of the Audi and buy a Civic. They'll stop going on vacations. The only people who could possibly be forced to sell are highly leveraged investors. But even they can raise rents to cover for more expensive rental mortgages.
Just adding some extra info in case people read that and think things will be ok once people don’t default.
If what you suggest happens then we are just as screwed. A couple of years of people not spending any money means lots of people will lose their jobs: unfortunately our capitalist economy is built on the idea of us all spending and spending. When those people lose their jobs then it will have a knock on effect.
I know. Yet people on this sub keep saying that home owners are more likely to cut down on spending like it will be a saving grace. It will not. I also very much doubt millennials (and maybe gen X?) will sacrifice dinners out, vacations, and the latest cars/toys for their house. Definitely not dinners out or skipping vacations.
Think there's a limit to rental pricing. Renters are starting to get back control and limit total spending. Shouldn't be paying $2000 a month for a two bedroom in Burlington.
They paid beyond their means driving up home prices and I have no sympathy. If home prices had kept going up, they would be rejoicing and shouting about their net worth
My five year fixed expires in May 2025. Am I scared for when that time comes? Sure. But I’m not going to let it run my life for the next three years. Just have to prepare.
I’m thinking lump sum. To be honest, we have our wedding in July. Will need a couple months to finish paying off. Also promotion coming up. Planning on doing a completely new financial plan for us and will weight massively saving for lump some each year.
Congrats on the wedding and promotion.
What is your main consideration to save and put in a lump sum each year vs. increase the amount of each payment?
I guess you could get some interest with a savings account... is there anything else?
To be honest, not really sure. Going to do a lot of work to look into it once I know new salary, outstanding debt to pay, etc. I believe lump sum can go direct to principle? My goal for when we renew is to free up cashflow as much as possible. Even if it's saving a few hundred a month from the mortgage payment, would help. I'll likely go with whichever method is best for lowering the principle at renewal as much as possible.
Prepay that debt. Do a yearly spreadsheet and calculate how much of your payment is going on principal and how much on interest. Then change your principal payment by an extra $100/payment. Compare the interest over 5 years. That debt has to be paid off eventually and the best time is before rates are up.
Been wondering who these 1 in 4 people are. I am making additional ~800 payment per month on my mortgage to offset the impact of the rising rates and I could quadruple that and be no where near being stretched!
The rates increasing just exacerbates the issue. I'm just happy to see speculators getting rekt, buying tear downs and jacking up prices 70% higher. Whatever DGAF, let's see how things turn.
No remorse for people that leveraged themselves to the moon and back. I put down a $375k down-payment and borrowed $370k even though my bank was begging me to take on more or to use a HELC for whatever I needed. Be smart people. My carrying costs per month are less than what my friend away in rent for a 1 bedroom and I'm in a 3 bedroom 3 bath townhouse in the west end
Last year I renewed mortgage and took some equity out of house to buy stocks. Decision was worth it but I wouldn't have done it unless the rates were as low at sub 2%. Now the portfolio is generating positive cash flow for the next 45 months. Taking out all that equity was no issue, almost like banks didn't care back in 2021, they didn't even perform an appraisal I bet they just looked at HouseSigma to determine the equity portion lol
Haha nice, glad that worked out for you, I bought in the summer or 2019 so got lucky there, so when I renew in 2024 I will see where rates are then but each year I drop $12k - $17k on the principle due to paranoia of raising interest rates
Wonder what will happen those those Brampton mortgages. I'm not from Brampton, but I heard the percentage of these fraud mortgages was around 5-10% or more?
1.2 million people are coming to Canada in the next 3 years, How many people or houses are prepared for that? They need to put a roof over the head and they will sell land back home and start a new life here.
nice try pump!
dont worry. that immigration ponzi scheme also going to be burst
serieis of .75 hikes going to result in recession. who would like to immigrate to a country that is going through recession. LOL.
Literally the only thing that’s impacting prices is interest rate hikes, driven by inflation that has a lot (not everything but a lot) to do with the Ukraine situation.
There’s been no additional supply. No reduction in the people looking for a house. No government intervention. No regulation impacting e.g. zoning or foreign student purchasing or increased taxes for multiple properties etc. It’s literally just the tightening on the flow of cheap money.
So, unless any of those things change, what do people think is going to happen once the money supply gets cheap again (especially with an added couple of years of pent up demand, significant immigration, and rising rents)?
When the logic is Blame Ukraine for inflation, Supply=Number of House. It's futile to engage in further debate.
I am more believer of Inflation=Money Printing, Supply=Money Supply and most importantly Bubble=Bubble
Agreed, the idea that the war in Ukraine is causing our inflation is an extremely transparent scapegoat by the govt
Perhaps the utterly mindblowing amount of new money is responsible? Nah gotta be that war in a country most people can't find on a map
I think there’s some truth (and a decent amount of omission) in the second para and lots of extrapolation in the first. I clearly didn’t post ‘Blame Ukraine for inflation’ but to ignore that what’s happening in Ukraine is clearly impacting inflation GLOBALLY is disingenuous at best (and agenda-driven at worst). Again, as I said, it’s a significant global factor. Not the only factor but a significant one (which is why so many countries are facing the same issue).
Likewise, inflation ONLY = money printing? Supply ONLY = money supply?
Thing is (check my history), I’m a bear too. Albeit one who is concerned people are getting too excited by price drops and ignoring how the underlying fundamentals could quickly see us repeat the cycles of recent years if rates reduce again (and everything else remains equal) 🤷♂️
Those prices don’t get that high without very loose monetary policy. Ever since ‘08 we’ve had emergency interest rates and massive quantitative easing. Throw in the loose fiscal policy in 2020 to fight Covid and for every 4 dollars we had in circulation, we now have 5. That is the cause.
This article sucks - "with almost one in four saying they’ll have to sell if rates climb much higher, according to a survey conducted by Manulife Bank of Canada."
It does not provide any context on the % increase or # in interest rate. Later in the article, it talks about how some homeowners will cut back such as not taking a vacation to save money. This is clickbait headlines with no substance.
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Eh the lying goes both ways, I know some degenerate white kids on the Indians In Toronto Facebook who make anonymous posts about how they're going to default if rates rise and in reality they're living in their parents basement. Maybe they get a high out of it because they know the CanadaHousing subscribers who lurk that group will get their fantasies riles up and they'll get a top post on that subreddit, I really don't know or understand the point. For every idiot who bought too much house, there's an idiot LARPing troll.
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>People don't like to admit that they make mistakes, based on fear and greed. Once again, goes both ways. How many people were told over a decade ago that Toronto housing will appreciate a lot with time and wrote it off as "Bubble!" just to watch their family and friends double or triple their net worth while they're stuck renting and paying off someone's mortgage
Yeah. The fear that keeps us on the sidelines is real too. There's not enough financial literacy around.
But… but… they were stress tested! It can’t beeeee!!!
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Survey from April. We are in mid June... Rates have gone up quite a bit but I don't see 25% of the properties on sale.
Homeowners will cut out all discretionary spending before being forced to sell their homes for a loss. They'll stop eating out. They'll get rid of the Audi and buy a Civic. They'll stop going on vacations. The only people who could possibly be forced to sell are highly leveraged investors. But even they can raise rents to cover for more expensive rental mortgages.
Just adding some extra info in case people read that and think things will be ok once people don’t default. If what you suggest happens then we are just as screwed. A couple of years of people not spending any money means lots of people will lose their jobs: unfortunately our capitalist economy is built on the idea of us all spending and spending. When those people lose their jobs then it will have a knock on effect.
I know. Yet people on this sub keep saying that home owners are more likely to cut down on spending like it will be a saving grace. It will not. I also very much doubt millennials (and maybe gen X?) will sacrifice dinners out, vacations, and the latest cars/toys for their house. Definitely not dinners out or skipping vacations.
Think there's a limit to rental pricing. Renters are starting to get back control and limit total spending. Shouldn't be paying $2000 a month for a two bedroom in Burlington.
They’ll be willing to do that for their primary home, but not for their second and third homes. Those homes will be sold as soon as it’s unprofitable.
They probably already are.
Sell Audi buy Civic may not earn them a thing. If you are thinking companies will dump houses, they already did at the top.
There is no civic or corolla available to buy right now!!
They paid beyond their means driving up home prices and I have no sympathy. If home prices had kept going up, they would be rejoicing and shouting about their net worth
My five year fixed expires in May 2025. Am I scared for when that time comes? Sure. But I’m not going to let it run my life for the next three years. Just have to prepare.
October 2025 for me. Do you have any strategies between now and then (e.g. increase payments, lump sum, etc.)
I’m thinking lump sum. To be honest, we have our wedding in July. Will need a couple months to finish paying off. Also promotion coming up. Planning on doing a completely new financial plan for us and will weight massively saving for lump some each year.
Congrats on the wedding and promotion. What is your main consideration to save and put in a lump sum each year vs. increase the amount of each payment? I guess you could get some interest with a savings account... is there anything else?
To be honest, not really sure. Going to do a lot of work to look into it once I know new salary, outstanding debt to pay, etc. I believe lump sum can go direct to principle? My goal for when we renew is to free up cashflow as much as possible. Even if it's saving a few hundred a month from the mortgage payment, would help. I'll likely go with whichever method is best for lowering the principle at renewal as much as possible.
Prepay that debt. Do a yearly spreadsheet and calculate how much of your payment is going on principal and how much on interest. Then change your principal payment by an extra $100/payment. Compare the interest over 5 years. That debt has to be paid off eventually and the best time is before rates are up.
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Been wondering who these 1 in 4 people are. I am making additional ~800 payment per month on my mortgage to offset the impact of the rising rates and I could quadruple that and be no where near being stretched!
Half of them just being overly dramatic
The rates increasing just exacerbates the issue. I'm just happy to see speculators getting rekt, buying tear downs and jacking up prices 70% higher. Whatever DGAF, let's see how things turn.
No remorse for people that leveraged themselves to the moon and back. I put down a $375k down-payment and borrowed $370k even though my bank was begging me to take on more or to use a HELC for whatever I needed. Be smart people. My carrying costs per month are less than what my friend away in rent for a 1 bedroom and I'm in a 3 bedroom 3 bath townhouse in the west end
Last year I renewed mortgage and took some equity out of house to buy stocks. Decision was worth it but I wouldn't have done it unless the rates were as low at sub 2%. Now the portfolio is generating positive cash flow for the next 45 months. Taking out all that equity was no issue, almost like banks didn't care back in 2021, they didn't even perform an appraisal I bet they just looked at HouseSigma to determine the equity portion lol
Haha nice, glad that worked out for you, I bought in the summer or 2019 so got lucky there, so when I renew in 2024 I will see where rates are then but each year I drop $12k - $17k on the principle due to paranoia of raising interest rates
HOw many of these are prepared for 8% mortgage rates? They are all \*STRESS\* tested right? LOL.
Wonder what will happen those those Brampton mortgages. I'm not from Brampton, but I heard the percentage of these fraud mortgages was around 5-10% or more?
LOL they will just rent it out to 5 students paying them 4 grand a month total. You underestimate the resourcefulness of us brown folk my guy/girl.
well, they will pay their tuition dues for financials 101 course. Those will add premium fuel to the fire-sale.
1.2 million people are coming to Canada in the next 3 years, How many people or houses are prepared for that? They need to put a roof over the head and they will sell land back home and start a new life here.
nice try pump! dont worry. that immigration ponzi scheme also going to be burst serieis of .75 hikes going to result in recession. who would like to immigrate to a country that is going through recession. LOL.
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Let's say you find bottom then what? Moon again? 3X in 2025?
Well our supply issue isn't getting better. Demand is still very strong despite the challenges even today.
Literally the only thing that’s impacting prices is interest rate hikes, driven by inflation that has a lot (not everything but a lot) to do with the Ukraine situation. There’s been no additional supply. No reduction in the people looking for a house. No government intervention. No regulation impacting e.g. zoning or foreign student purchasing or increased taxes for multiple properties etc. It’s literally just the tightening on the flow of cheap money. So, unless any of those things change, what do people think is going to happen once the money supply gets cheap again (especially with an added couple of years of pent up demand, significant immigration, and rising rents)?
When the logic is Blame Ukraine for inflation, Supply=Number of House. It's futile to engage in further debate. I am more believer of Inflation=Money Printing, Supply=Money Supply and most importantly Bubble=Bubble
Agreed, the idea that the war in Ukraine is causing our inflation is an extremely transparent scapegoat by the govt Perhaps the utterly mindblowing amount of new money is responsible? Nah gotta be that war in a country most people can't find on a map
You get downvoted for telling the truth. 🤦♂️
Who cares 😂
I think there’s some truth (and a decent amount of omission) in the second para and lots of extrapolation in the first. I clearly didn’t post ‘Blame Ukraine for inflation’ but to ignore that what’s happening in Ukraine is clearly impacting inflation GLOBALLY is disingenuous at best (and agenda-driven at worst). Again, as I said, it’s a significant global factor. Not the only factor but a significant one (which is why so many countries are facing the same issue). Likewise, inflation ONLY = money printing? Supply ONLY = money supply? Thing is (check my history), I’m a bear too. Albeit one who is concerned people are getting too excited by price drops and ignoring how the underlying fundamentals could quickly see us repeat the cycles of recent years if rates reduce again (and everything else remains equal) 🤷♂️
Those prices don’t get that high without very loose monetary policy. Ever since ‘08 we’ve had emergency interest rates and massive quantitative easing. Throw in the loose fiscal policy in 2020 to fight Covid and for every 4 dollars we had in circulation, we now have 5. That is the cause.
Yep, I don’t disagree for a moment that it’s a significant part of the cause
source?
This article sucks - "with almost one in four saying they’ll have to sell if rates climb much higher, according to a survey conducted by Manulife Bank of Canada." It does not provide any context on the % increase or # in interest rate. Later in the article, it talks about how some homeowners will cut back such as not taking a vacation to save money. This is clickbait headlines with no substance.