What’s the best time buy or sell?
Occasionally I will get a question like “hey I’m looking to sell soon, when’s the best time?” or “when should I buy to get a good deal?”
The answer to both is: you’re probably focused on the wrong thing.
The reality is, you can’t normally outsmart the market so you shouldn’t think too hard about what month or week to buy in. But let’s examine this a bit closer. What people are actually asking is: can I get a better price at some point in the year? More precisely, they are asking if there are some times of the year when properties can deviate from their market value. The short answer is no, but there is some nuance there.
I’ve looked at the issue in the past on the selling side, in my article about whether it’s a better time to buy in the fall. In that article I found that the fall market does usually bring some price weakness both in terms of sales prices relative to assessed values, and the price that sellers will accept relative to list price. However the difference is very small, only about a percent less in the winter compared to the spring on average.
And not all of that is necessarily a reduction in prices relative to the properties’ value. Part of the reason sellers are slightly more flexible on price and properties sell for slightly less compared to assessed value in the fall is that the average condition of properties is not as good. Move-in ready properties have broader appeal and tend to sell in the spring market if reasonably priced, while those with some defects are more likely to hang around into the winter. Those small defects that buyers care about aren’t captured in assessed value so the weakness relative to assessment doesn’t tell the full story.
I still recommend that house hunters not give up looking when the market is slow from November to January. Most opportunistic sellers will pull stale listings and try again in the spring, but the ones that stick around in the winter through multiple price drops or with vacant properties may be more willing to negotiate when other buyers are scarce. In addition, there are always people that have to sell, and in the winter those sellers make up a greater percentage of the listings (vacant sales make up a greater percentage of activity in the winter than the spring). Just don’t kid yourself that you’ve found an undiscovered gem. If there’s a property that’s been listed since the spring and is still there by November, there’s a good reason, and that reason is nearly always a price that was too high.
But what about the selling side? In some ways it’s just the other end of the buying side so the findings above still apply. However if you want to sell a place, should you list it now, in January, in March, or in May? Part of this of course depends on what your plans are afterwards (are you buying another place?), but let’s put that aside.
Beyond price, there’s also the issue of time to sell, and it’s pretty clear that things move faster for listings in the spring. Peak sales months are April through June most years, but you don’t need to wait until then to list. The improvement in sales time happens quite quickly, and generally by mid to late January the market has recovered substantially from the winter doldrums.
The myth of the deal
Why do people even believe that there are deals to be had? No one is asking when they should buy their TD shares (protip: not right before they get busted for money laundering), so why are people so keen on it with housing? It’s not entire baseless. The housing market is less liquid than the stock market and each property has unique aspects that make establishing market value substantially more difficult. That’s increasingly true as you get away from the mainstream product. What’s the market value for a property that has only one or two potential buyers looking at it?
Prior to the availability of online listing services, there was much less exposure for property sellers. That made properties more difficult to price and increased the chance that a buyer paid more or less than market value as it was expensive to expose listings to enough buyers. However the housing market has been made substantially more efficient in modern times, and thus there’s less opportunity for real below-market sales. Every new listing is sent to hundreds of people with private portal alerts, and hundreds or thousands more will see it online in the following weeks. Just as in the stock market, finding deals is exponentially more difficult today than in the past.
The exceptions
All that isn’t to say that deals are impossible to find in housing. Most people know someone with a story about how they got a good deal on a place, but once you dig deeper, there’s usually a reason.
- The dinner party effect – Everyone likes a deal, and for that reason those stories are likely to get told at parties. “Oh yeah, well when we bought our house we paid list price” isn’t nearly as engaging.
- Unique information – You can outsmart the market if you have unique information the market doesn’t have. Is the zoning about to change? Are the obvious defects not as bad as they appear? Is the property not listed publicly? Is the owner desperate to sell? Many things could give you an advantage, but take a moment to consider how unique the information you have really is.
- Unique skills. Mostly this falls under renovation skills. Properties that need substantial renovations have a smaller buyer pool, so are more likely to deviate from their market value. In addition to that, people with construction skills will often be able to secure a discount if they can bypass market prices for required renovations. If the average buyer is factoring in $40,000 for new perimeter drains but you can do it in a weekend with your excavator you have an advantage. It’s debatable whether this really constitutes a below-market purchase (you could spend that weekend earning $40k on another job) but it feels like one.
- Unusual times – There is the odd time where the market freezes up and we see more sales that seem to be outside of market value. On the downside, this happened briefly during peak COVID lockdowns, while the world’s financial systems were melting down in the fall of 2008, and during the housing crash of 1981. On the other side it can happen during times of market mania, like spring of 2022 when three quarters of properties were going in bidding wars, sometimes for well over their true value.
In general though, worry less about timing and more about fit. If you save a percent or two on the purchase but have to upgrade the place sooner because it’s not the right home, you’re likely to lose the savings and more in transaction costs.
Also the weekly market activity:
| November 2024 |
Nov
2023
|
||||
|---|---|---|---|---|---|
| Wk 1 | Wk 2 | Wk 3 | Wk 4 | ||
| Sales | 30 | 170 | 287 | 394 | |
| New Listings | 89 | 332 | 512 | 885 | |
| Active Listings | 3103 | 3063 | 3013 | 2644 | |
| Sales to New Listings | 34% | 51% | 56% | 45% | |
| Sales YoY Change | — | +44% | +47% | +3% | |
| New Lists YoY Change | — | +3% | +0% | +13% | |
| Inventory YoY Change | +14% | +12% | +10% | +25% | |
| Months of Inventory | 6.7 | ||||
Sales are maintaining their pace at around 50% higher than this time last year while new lists are keeping up with the year ago pace. The numbers look even stronger when looking at residential resales in the metro area (Sooke to Sidney), where new lists have been lagging the year ago pace while sales are nearly 70% higher.
That has meant substantially stronger market conditions than a year ago.
How does that look in historical context? Well last November was the second weakest November in 20 years, so a substantial improvement in conditions still doesn’t get us into a strong market, but November should finish pretty much at the historical average.
Keep in mind that the “average” market conditions during those 20 years is decidedly a sellers market with rising prices, and the only reason those market conditions are not tighter is because of a continued strong pace of new listings. Last November we saw the second highest pace of new listings in 20 years, and it looks like we’re set to match it or come close this year. That will have to continue to keep the market in check at these sales levels.
New post: https://househuntvictoria.ca/2024/11/25/nov-25-market-update/
im waiting for patrick to jump in with some facts that say Canada isnt folding tent
westerly, the canadian dollar is non starter, we have had a 60 cent dollar in the past and not a big deal . real estate will be on sale for americans, think whistler. Best thing we can do is get interest to neutral and let the dollar fall . im seeing all sorts of irrational over reaction to trumps ramblings
Thursty- I appreciate your enthusiasm about real estate appreciation. Although I don’t think SFHs will go down, I do think that prices will stagnate for several years. Prices are just too high and the average Canadian simply can’t make enough money to comfortably afford one in the top markets. I also think that the immigration golden road is going to slow and may even reverse.
Thursty, “him slapping on tariffs will be good for real estate”. Can you elaborate? Why, because the can$ goes in the can?
We’ll see. It’ll depend on whether Trump loyalists are actual yes men, or just ruthless careerists imo.
Dad, this trump being trump, it’s all b.s . I hope he does power up the economy as it will be good for Canada . No difference from last time he was in power . In fact him slapping on tariffs should be a boost to real estate prices
The potential hit to our GDP doesn’t really bode well for real estate does it? I appreciate the whistling past the graveyard shtick, but c’mon man.
Tariffs are also likely to be inflationary which doesn’t bode well for lower rates. Fingers crossed there are still adults in the room in DC.
Wait 10 years and buy a new house to go with a new kitchen. LOL!
Nothing odd about it imo. This is who Trump is, and he repeatedly turned to the subject of tariffs in his rambling, incoherent rally speeches during the campaign.
Trump doesn’t give two fucks about Canada.
Meh, it will be business as usual. I don’t c what the fuss is about . We are a real estate superpower, that’s our secret weapon
Wait 10 years in hopes that kitchen cabinets will be much cheaper then.
What answer do you want?
Also I’d much rather stay friends with the US.
It is a bit odd that trump wants to further alienate the US – especially from its closest neighbours and us – very close in proximity and close in culture. Putin and Kim are rubbing off on him.
Let’s hope we figure out something for the arctic fast.
Below is a quote by Albert Einstein that I hold dear to my heart since I first found freedom as a child in Canada circa 1980.
“There are only two ways to live your life. One is as though nothing is a miracle. The other is as though everything is a miracle.”
Yes, we are stuck with these guys. Maybe sanity will prevail in four years, but I wouldn’t bet on it.
i understand America is our number one trading partner and they hold the reserve currency. Are we just stuck with these guys forever? Is finding other trading partners the end of the world?
Lol, you think a 25% across the board tariff won’t affect Canada? If he actually does what he says, we’re in for a global trade war.
Your only hope is that Trump isn’t moronic enough to do it, or that he doesn’t have the executive power.
dee, u will be just fine , the chatter of tariffs is a non starter. Wont have much if any effect on Canada
What will the tarifs affect? Should I buy my kitchen cabinets now?
Entertainment has already started, a full 2 months in advance.
https://www.cnbc.com/2024/11/26/trump-vows-an-additional-10percent-tariff-on-china-25percent-tariffs-on-canada-and-mexico.html
We’re gonna need a hell of alot more beer than $250 worth.
Bring your cheque.
And beer
Dude, I have two Strats , a 12 piece Pearl drum set, all the PA’s, mics, etc for all the vocals including (backup,frontman) whatever.
Max, good for u , self help . I can come over and help u drink all that beer , maybe bring over the tele to plug into the marshals
I think it almost all comes down to random luck. Yeah I’m ok with the randomness 🙂
Thanks for the idea Arrow
Well, I’m not here to bullshit anyone. I’m going to take that $250 cheque and head straight down to the BCLS and buy 8- 15 packs of beer and then spend the balance on lottery tickets!
Its the holiday season of “ignorance is bliss”.
Some people are raised to believe in themselves, others start their adult lives already beaten down.
100%.
Thursty -“In my life I credit my good fortune with a lot of mentoring from family.”
That creates self respect, which is the key to believing one can do better. Those two attributes influence ones quality of life more than growing up with money or an education do.
Dee -“Of course it’s nice but I think it’s better spent elsewhere.”
Your good nature & good idea inspired me: I pre-spent some of my vote buying cheque and bought a good wool blanket for the one homeless gentleman in my neighbourhood.
Exceptions can be made for a man of your caliber.
Max-You’re going to want Manitoba’s hydroelectric power to survive.
Leo, we need to seriously consider adding LOL emoji in addition to the Thumb Up.
If we got rid of Trudeau along with anything and everything East of Saskatchewan. The West would be just fine!
Loyalty, not performance.
It’s hard to think of a bigger contrast in world leaders than Trump and Singapore’s current PM.
Lawrence Wong is the ultimate middle of the road, reasonably competent technocrat. An institutionalist to the core. he stands for incremental change, as needed, within the current system. If Wong was an American politician, he’d be part of the “deep state” that Trump wants to destroy.
Either do I. Effort equals results.
Exactly. Its those that figure it out young (like 18) rise above it. The ones that dwell on it (for like years) end up wallowing in it. Also I wasn’t deprived so it wasn’t a hardship. It was just very action packed.
$0.60 USD to $1 CAD would drive capital investments out of Canada, combine with tariffs would definitely drive up inflation and interest rates.
I have to agree. We shouldn’t vote for morons, no matter their level of education.
I think Trump wants more of a Singapore authoritarian governing style that tie public employee salary to performance.
Educated has nothing to do with it. It is the entire govern body that run on personal interest, favoritism, lobbying, nepotism, and diversity, instead of economy focus.
Sidekick , I agree I’m floored by the cost of materials . I guess that’s how we arrive at 4 mil for a new house . Frank has it right , houses should be tied to bitcoin and the average house should be 200 mil , imo
Some blame the 1930’s depression on the Smoot-Hawley Tariff Act, when the U.S. imposed massive tariffs to protect American producers. I wonder if Trump knows anything about this. I doubt it, that’s the problem with voting in uneducated morons to lead our countries.
Patriotz, I think alot of countries look for balance in their growth . trump wants China style growth and cares rocks about the environment or equality. That’s not the case here and just wouldn’t fly today
Prior to the last Trump term I had the option to hedge on a decent sized order of rebar. I didn’t, and as a result the cost went up 50% after the steel/alu tariffs. Tariffs will absolutely push up new construction costs. Ugh.
Isn’t every politician? Doesn’t mean they’ll get it. Even the ones who have a clue.
Dad, yep voodoo economics, but i wouldn’t worry too much about tariffs or even a 60 cent dollar . I think we have a lot of room still for interest rates to go down .
I’m sure the tariffs will do wonders for low rates.
Marko, “Random luck is a smaller factor in Canada…” Ya, we’ve had a couple property purchases over the past 10-15 years that were the result of bad luck, well maybe poor guidance on behalf of the lenders. We pushed through on both and have been very fortunate for it. How does the saying go, “if life gives you lemons…” While I feel fortunate to live here and have the opportunity, I don’t attribute anything we’ve accomplished to luck.
Vicre, ya trump and the bond market is going to be more challenging for the bank of Canada . At least trump is a fan of a hot economy and low rates
Rates not looking good thursty, 5 year yield back up to the 3.2% range now from the lows of 2.7% in late summer.
https://www.mpamag.com/ca/mortgage-industry/market-updates/new-home-prices-plummet-to-lowest-level-in-14-years-across-canada/515288
Interesting
good to see sales up and new lists down. a couple more interest rate cuts before the spring market should heat that puppy up.
Some people rise above hardship, others wallow in it.
That’s what determines success.
Month to date activity
Sales: 425 (up 46% compared to same time last year)
New lists: 656 (down 6%)
Inventory: 2909 (up 9%)
Marko, all of which help to inflate asset prices. I say keep it coming .
The majority of the world lives in less square footage. I don’t understand how we can expect more in Canada when we are doing everything we can to lower productivity, increase bureaucracy, chase away investment and we aren’t taking advantage of our natural resources. It doesn’t shock me at all that our GDP per capita is diverging from many countries such as the US. We are becoming poorer in relation and with that expectations on the housing front have to drop.
Random luck is a smaller factor in Canada than the vast majority of countries around the world. Typical story in Croatia from the island my father is from; 50 to 100 years ago inheritance is subdivided and the kids the parents don’t like are given waterfront property (difficult to grow things due to salt, etc). No one needs to sell it off as there is no property tax of any sort. No capitals gains, etc., so they just let it sit for generations at no cost. Today some of these waterfront lots are being sold in the multi-millions of Euros to Russians, and EU buyers. Many other examples of where completely lazy morons are set for life. Even better is those kids inheriting expensive condos that were gifted to their parents by the communist party so the parents didn’t even earn these assets in a fair manner to start.
In Canada sure you may inherit a home in Oak Bay but first of all between property tax and insurance you are over $1,000/month then add maintenance. Then you can’t really let it sit vacant due to vacancy tax. Then if you keep it you get hit with capital gains (unless you move in). You need to be somewhat capable/smart to maintain random luck in Canada.
I haven’t followed it closely but a quick search of the last few years: $500, $1,200, 10% more OAS over 75s. Maybe he’s saving the best for last.
I don’t recall any money being pumped out to me, only away from me.
This has got to be the most ill conceived program ever created. Something tells me that the liberals came up with it to humiliate Trudeau and get him canned.
He’s been pumping it out to seniors for years. Pretty sure the working class are the last to be bribed.
Supposedly, seniors who are not working will not receive this $250 allowance, according to the stipulations on who receives the crumbs. For that matter, anyone who is not working will not receive it either. That’ll go over big with voters.
Probably his son. What I find disconcerting about that $250 cheque and little GST holiday is that apparently it puts our country another 6 BILLION into debt. Please make it stop!
Pierre Trudeau?
No secret there Max. The old handle was too long as most people just shortened it anyway. The icon is the same as before, seems you can’t change it just by going under a different name.
“Whiles I am a beggar, I will rail and say there is no sin but to be rich; and being rich, my virtue then shall be to there is no vice but beggary.” – The Bard of Avon
I-am-Groot!
Well, you are whatever aren’t you? Or are you Barrister? And wheres K112 and Just Jack? Did hopeful ever find that house out in Sidney since it was so close to that really big Canadian Tire store? I also think sam at 3:35 pm is actually Marko in disguise.
Going to bed. Enjoy your evening.
Max , a wise man once said if u don’t have enough debt you’re not trying hard enough.
Max, it isn’t about you personally just that your comments are whataboutery.
None of this has anything to do with me. My five year fixed matures late October 2025. One more five year fixed term and I am done with banks forever. The only reason I have another term is because I pulled a Thursty and leveraged the house to build a garden suite in my back yard. Money well spent, especially at 1.86%.
You started it with your cricket theory on the ultra high end market.
Max, sounds like you really want to find some way to stick it to the banks. One should consult an insolvency trustee before going into foreclosure as the laws vary from province to province and person to person.
Sam, i think sometimes it’s worst having wealthy parents , it becomes a real shock when the rug gets pulled from under u . I have many friends from Dunbar area that really never amounted to much . It’s only until u get older that u learn money is very fleeting and u really never had enough . I had a house in edgemont and luved doing projects in West Van
I did, twice. the lender might pursue a judgement for the difference.
If the borrower went BK and the lender is now underwater on the asset…Then what?
Max read my comment at 4:02.
Smart is good. I think there’s also random luck. I’m sure there’s academic papered written on the role of luck and the implications.
As for the$250, people with our household income do not need the money. Of course it’s nice but I think it’s better spent elsewhere.
Even if they go in the red?
In that case Max, the lender’s collection department will keep dropping the asking price until it is within reach of buyers.
That works great if the property is within the reach of any prospective buyers in today’s market, as apposed to the crickets you were suggesting in your original post.
Max, when the property sells the lender receives the outstanding balance, late fees, penalties, and foreclosure costs. If there is any equity left it’s returned to the home owner. If you owe more then the lender might pursue a judgement for the difference.
I came from everything in West Vancouver and then lost everything .. my parents lost everything. I fought very hard for the last 15 years to be able to buy a house. It is not about being privileged or working hard… that does not matter IMHO . What matters is if you are smart .. so start there.
Well then the lender can have his team gather at the round table, in front of the white board, right beside the water cooler and discuss how the hell they are going to handle this situation…And that costs a lot of money!
I get that part. I would too!
Patrick, “That means no cut in sales tax and no $250 giveaways for a start…” Can’t disagree here but I’ll be accepting mine. We’ve decided to give ours to our son to add to his FHSA or RRSP towards a down-payment in a couple years.
There’s a few things about JT’s gift that people with young adult kids may want to know (if they don’t already):
– A person has to have worked in 2023 and paid into CPP and EI. (I haven’t seen the CPP / EI part in the Gov adds, just a discussion on a CPA’s website)
– A person has to have filed their 2023 income tax return by Dec 2024. This is important, some young adults don’t file as it’s not required if no taxes are payable.
– It’s payable in April 2025. Interesting they chose next fiscal, but also to be aware, this is long past 2023 FHSA (has to be contributed in 2023), and it’s past RRSP contribution cut-off (end of February?)
I was talking to our son the other day about the FHSA and RRSP contributions / withdrawals (first time home buyer). He has enough to max his 2023 $8,000 contribution but it’s tied up in a GIC until January – this is too late for the 2023 carryforward which would be lost. Between us we’ll make sure that doesn’t happen (not the end of the world if it does but a year is a year).
I haven’t told him about the $250 X2 but when I do I’ll ask that he also puts his own in there and any resulting tax credits going forward. $750 plus rolling tax credits can quickly become over $1,000.
Separate from this, I’ve learned that the new (new to me) RRSP withdrawal for First Time buyer is $60,000. And as far as I can find they (son and GF) can each use both the $60K RRSP withdrawal and the $40K plus earnings FHSA, totaling $100,000+ each. This is now getting into purchase territory in 4 years.
Hope this helps others in their planning.
Well Max there are things the mortgagee can do, but the lender will only have so much patience. The lender doesn’t want the property, they just want their money back.
The mortgagee can sell the property themselves or finance with another lender and pay off the mortgager.
Ya i wouldnt worry about the rich, they are still doing well . This shouldnt be news but the housing market has been well supported by banks through this downturn.
How exactly would this help the lender? Yay! Now we have a great big house with great big property taxes to pay with sky high insurance premiums to pay since the house is now vacant and there are even more crickets at the showings than ever before!
The lender would more than likely be subject to the land vacancy tax. The lender would have to heat the house so the mildew doesn’t set in. The lender would have to pay the gardener to maintain the property so it doesn’t become over grown and derelict. The lender would have to hire a property manager of some sort to go checkout the interior atleast once a week. The lender would have to keep up with all the security/camera, Irrigation air blowouts, gutter clean outs, pressure washing payments …On and on and on.
The lender would also have to pay someone in the office to make sure all these measures were taken care of on a monthly basis. Not to mention the accounting and legal costs. The lender would be far better off negotiating some kind of deal with the homeowner. Unless of coarse the homeowner hasn’t already planned a strategic default, collapsed that shell company and moved on!
I kiss the cross around my neck quite often.
No offence taken.
The way I see it, most HHVers who’ve made it this far and are living successfully in Victoria (like me) are also very lucky, and should be fortunate for that. All it would take is an accident or illness to end all that. I pinch myself regularly to remind myself of that.
And if course there are many truly disadvantaged people in Canada that haven’t been so lucky or otherwise haven’t received the opportunities that we have. And I definitely am not referring to them when I say that we have it made. Government should do more to help those people and leave the “workforce” making up to $150,000 per year alone to fend for themselves. That means no cut in sales tax and no $250 giveaways for a start. Put that money to use helping the poor.
I’m just commenting in response to people discussing that Vic students now have to pay for parking and they didn’t 20 years ago. And that’s supposed to mean something. So what?
Today there are 346 houses for sale in the Victoria Core which is about 3.3 months of inventory. The median sale price for the last 30 days was $1,172,500 with an average days-on-market of 46. The typical sales to assessment ratio is 97 per cent. That doesn’t seem too bad, but there is more to the numbers than just the median and DOM.
50 percent of the house sales in the core (middle income range) lay between $997,000 to $1,450,000 with the MOI at 1.75 and a DoM of 39. If one is house hunting in this price range the market is slightly in favor of sellers with the typical home selling at 101 percent of assessed value, but still not enough to raise house prices as the typical home is selling in this price range at $1,135,000.
Once a prospective purchaser is in the top 25 percentile there is a large increase in the MOI to 7.9 MOI and the DoM is 57 days. The market for housing in the Victoria Core is top heavy and using these metrics would by a buyers market.
The top 10 percentile of houses that would be appeal to the top 2 percent of incomes would be houses over $3,575,000 has been the sound of crickets with 35 properties listed and only one sale in the last 30 days. A home owner in this price range that is forced to sell within 90 days is going to be bludgeoned. Such as a property in Saanich that was previously purchased for $6.6 million and is now listed at $4.9 million.
Now here’s my opinion. The Victoria Core housing market is top heavy and we will need to see price decreases in the upper income market as sellers expectations are not aligned with local or out of town buyers. We have likely lost most of the top 2 percent of income households to other cities in Canada. For them Victoria may be a nice place to visit but they wouldn’t want to live here as they get more value for their money elsewhere. That’s the problem with living in a small island city as Victoria has to compete, for the two percenters, with the Metropolitan cities that have more amenities and greater ease of travel.
You left out social media and “reality” TV, which is the message I get from that chart. I didn’t grow up with either of course.
My parents raised me. When I turned 18 I moved out because I couldn’t stand living with them anymore. That was kinda the normal thing to do if you didn’t want to look like an oddball. I did rent a suite from my Dad because he was a land pimp back then with a few rental properties, but that was different since he didn’t live there. I was given advice from my parents but money was never given to me, that was always something that had to be earned.
As for inheritances, I don’t expect any. My Father is on his fifth Wife now and my Mother on her fourth Husband so there are quite a few siblings in the mix. I don’t want anything anyway, they can all look after them and fight over their money.
When I was young there were a couple of times I ran over budget on some solo ventures I was pursuing at that time. As a last resort I would hit my Father up for a short term loan. This would have been drawn up by his lawyer at high interest. Borrowing money from my Dad would have been akin to borrowing money from Knee Cap Eddy and as mentioned, A very last resort.
So well all my siblings are bitching and moaning, fighting with each other over who gets what. I’ll be sitting here, next to my one and only soulmate, with a smile on my face, knowing that when I meet my maker I can honestly tell him we did this all ourselves. With that said I’m sure I’m not the only Gen X’er that was raised in a dysfunctional family.
If we rely on people’s “opinion”, not actual statistics, on who/what is high income, we will get a completely different picture based on who you ask. Their opinions may be influenced by how they grew up, their age/generation, their income, their expenses relative to income, if their house is paid off, how recent bout of inflation affected them, etc.
Hmm Just as importantly, a good week of sales again with some strong prices . It appears the wise want to get a head start before the spring market . With low inventory prices should start pushing higher , all good news Canadian’s.
Well Patrick then I guess no Canadians come from nothing.
Yes I am very privileged.
I’ve been thinking about this more and part of the problem (for me) is the suggestion (perhaps unintentional) that people who are poor or who struggle are themselves to blame. If only they worked harder etc. It is false that working people are all lazy or that the problem is simply a lack of effort. Just like it’s a delusion to think that Canada operates as a perfect meritocracy.
Patrick I didn’t meant to offend you personally.
>> As for me, *** I personally come from nothing *** . I personally honestly do not care where people come from except it irks me when people don’t acknowledge their privilege.
So you “came from nothing”? Well look who’se not “acknowledging their privilege”! You really think what your parents and society provided you growing up was “nothing”? I consider it a privilege to have grown up in Canada period, where we’ve all had and have plenty of opportunities. And I certainly don’t consider where I came from – living in a rented house on the Prairies in the 60’s and 70’s to be “nothing”. It was awesome and our parents gave us a lot, through hard work , and we had plenty of opportunities. So I acknowledge that and don’t call it “nothing”.
How will you feel in 20 years if your kids post on a forum “I came from nothing”?
I personally honestly do not care where people come from except it irks me when people don’t acknowledge their privilege. Bobby acknowledges it – that’s very cool. I have a good friend who has a trust fund and she acknowledges it too. As for me, I personally come from nothing. Ended up having almost all my undergrad tuition paid via government scholarship but then got a lot of debt in the second degree. And, as I’ve said before, my parents didn’t/couldn’t help but my partner parents gave us the money for the down payment for our first house.
Now I’ve saved a lot for my kids’ university but coming from a working background I can see many peers that do not or cannot do this for their kids. So what will happen when these kids want to go to school – especially now that everything is so expensive.
It’s the increasing divide that concerns me —- and also the denial that it’s happening. Pretty hard to fix a problem if you don’t think there is one.
I am Generation X and can confirm that when I started university there was still some free parking on campus (not UVic). The most convenient parking was already pay but less convenient parking was free.
Bobby, “So yes compared to todays generation or most generations I had it easy, I’m starting to sound like Scott Galloway. I worked hard at my job and saved at least 50% of my income. I just don’t see this story being even remotely possible for most young people today unless your making 400K+ and spouse working”
$1,500 annual tuition? sounds low, but we were more focused on food on the table. We pay our kid’s tuition and it’s about $7,500 / year, not Harvard. Free parking? We parked off campus to not pay parking fees, this was mid-90’s.
The story wasn’t remotely possible in 1990-2000 either. One in a million. Sounds like you had it easy compared to your own generation.
I think most would agree that home ownership is much more difficult today than 25 years ago. The question is why? The answer is- rampant immigration. People with generational wealth sending their children here for a better life. They also wanted a place to stash their money and bought multiple properties. Every country has an upper class, and in countries like India, the top 1% would easily exceed our entire population. We are also finding out that Canada is a haven for criminals. Our justice system is so soft, crime really does pay. Countries around the world are finding this out and are electing governments that want to curb immigration. I think the cat is out of the bag, and things won’t improve for a long time. Get used to our new normal.
High house prices?…. So what, the day you buy your home , aside from transfer tax.fees, your net worth doesn’t change. You’re buying a $1m asset thats worth $1m. It will likely appreciate more than your mortgage interest, and you’ll be making money and increasing net worth from day 1 on the purchase. As most of the millennials who bought pre-Covid have found out, as their net worth has risen much faster than non-homeowners, despite the high home prices.
As stated that median income doesn’t includes many 100,000+ self employed who shelter their income in corp and the fact is a home was only 4x to 5x household income in 2000 in the core even using your figures vs 10-15x now.
> Yes Patrick despite what you think things were much easier back then.
Easy for the 1% of people like you making 4X median incomes, Because median household income in Canada back then was $55,000, and you were making 4X that + your wife’s income. Why do you assume that average -income people in the 2000’s also had it easy, when they were making 1/4 of the money you did?
Yes Patrick despite what you think things were much easier back then, although I never said my story was typical. Even my entry level job that may have paid 40-50K in 2000 was 4 – 5 times cost of average house vs 15x income now on entry level 70K job for a home.
Get real!
200k salary, +your wife working as well ?… Your story isn’t typical of average people in 2000.
Inflation adjusted to today would be $340k income for you + your wife’s part time income.
Well of course you had it easy, just likely someone today making $340k income + wife working would also have it easy.
I will admit I have had it pretty easy, I am part of generation x and went to university when tuition was $1,500 and parking on campus was free, I believe my share of the monthly rent on a really nice home that 4 of us shared in a larger Ontario town was about $250/month around 1990. After university I travelled for a few years when you could get a eurorail 6 month train pass for under$500 and there was no “tourism pollution” like now. I had my first job in 1995 that paid around 35K, I worked for a few years then took another year off and then met my wife and we travelled West.
I then talked my way into a job that paid me around 200K in 2000, we bought our first house in Victoria a few blocks from the ocean in the core for under 300K and paid half of it off with funds from a condo we were given a few years earlier in Toronto. The mortgage was paid off within 5 years before we then had a few children, my spouse worked part-time with provincial pension and rode her bike to work, I made my own hours and a good day was a couple of workouts and a golf game. I then retired in 2015 in my 40’s to spend more time with kids after working less then 20 years.
So yes compared to todays generation or most generations I had it easy, I’m starting to sound like Scott Galloway. I worked hard at my job and saved at least 50% of my income. I just don’t see this story being even remotely possible for most young people today unless your making 400K+ and spouse working. If one of my children was buying a house today I would probably give them 500K as a gift, hopefully matched by their spouses family so they could start a family early, that’s the way its going to be from now on for the most part where the wealthier families will give their children a big leg up, good luck if you don’t have that advantage, although I have a feeling home prices are going to continue to stagnate for the rest of this decade although property taxes will continue to accelerate at 5-10%/year as just anounced again by Victoria and Langford for 2025.
As I have stated things are so much harder now then in the past for young people, unlike what some of the elderly boomers on this fourm will tell you, no wonder we have a mental health crisis in the younger generations and more the 40% of gen z said they don’t intend to have children (US stats).
n/m
This is true. Education is much more expensive and you need more of it these days to get the same level job. So young folks already starting at a huge disadvantage with serious student debt. Then buying a house way more daunting now than 20 let alone 40 years ago.
There’s plenty of crusty curmudgeons on HHV who think they had it so hard back when and “young folks these days just want it all on a silver platter”. Also don’t get me started on some of the “self made” trust fund babies that think it’s all so easy because all that parental money made it pretty damn easy for them.
>> I can’t help but wonder if Patrick isn’t just imagining how things are for younger folks from a large sf home that he bought for 200k x decades ago. You know?
Well, “wonder” no more. The answer to that is no. Never got any parental help, and never bought a cheap home anything like that. And let’s stop shooting the messenger.
Dee, I was of the feeling that there are alot of selfmade folk on here . Getting help in life is a good start but peeps still have to have the hustle to make things happen. In my life I credit my good fortune with alot of mentoring from family . I do think there’s alot of good advice from folks like Patrick and so on.
Dee, I wouldn’t assume half of us didn’t come from the cleaner / labour population. I was a labourer and spouse was at a minimum wage retail job when we were first married; no education and limited prospects at 24.
Went back to school as parents (credit to my wife, and to the disgust of everyone that thought they should have an opinion) and we will retire comfortably. None of it was easy or cheap.
So in case no one has noticed the group of people that comment here on hhv are often privileged. It’s not like my cleaner who makes 30K/year is creeping the blog or commenting. That means we are not a representative sample of the larger population. In any case, I can’t help but wonder if Patrick isn’t just imagining how things are for younger folks from a large sf home that he bought for 200k x decades ago. You know?
Consider the age of the SFH in the core. They started building out Oak Bay in 1858 when they were panning gold out of the Sooke and Leech Rivers.
https://www.leechtownhistory.ca/
http://www.webturf.com/oakbay/history/gift/pdf/gift_print.pdf
And the Malahat looked like this…
Smaller dwellings?…. That’s more “hotdogs” – Zach wants steak!
You should run that by Zach and see if he’s interested in one of these new small places. Good luck! (Don’t mention that there might not be parking).
If you mean SFH. waste of land use. especially in the core.
Well yes and no. Indeed we have a lot of square footage per capita, but that square footage is very unevenly distributed. Much of the square footage is going into new houses that are affordable only to people who already own and can move up. And don’t forget empty nesters who are becoming increasingly common – and own much of the SFH stock in metro Victoria.
Now if that extra square footage were going into a greater number of smaller dwellings, we might be going somewhere. Has anyone though of that? 🙂
Wait… are you a 5 person household, or a 1 person household arguing like you’re a 5 person household? Big difference. Only 8% of households in Canada have 5 or more people, so let’s not pretend that’s the norm.
There’s always folks in every generation that feel hard done by . Social media reinforces this belief and folks cling on to it. Stats will never ever tell the whole story and only being in those times will fill in all the lil nuances that the big picture can’t hope to understand.
Canada’s existing housing stock has close to the highest square feet per person of any country. This contradicts conventional wisdom that we have a housing shortage.
About 700 sq feet per person in Canada. Close to the highest (USA=800) and well above most other countries.(France=450, Germany=450, UK=400)
So the question for anyone saying we have a housing shortage is, compared to what country does Canada have a housing shortage?
How can that be true, when the number of people per dwelling in Canada has fallen consistently, from 2.6 people per dwelling to 2.4. And Victoria is only 2.1 people per dwelling. Why would we need more homes if we cannot find as many people to put in the homes as previously?
You’re right Patrick.
There’s too many people out there who don’t want to move to Langford or Nanaimo, but also don’t want to live in a 900 sqft condo with their 4 or 5 person household.
All of these crazy Millennials and Gen Z kids with their outsized expectations…
Patrick, I hate to disagree with your expert opinion, but nearly every actual expert commentator I have read agrees that the biggest reason why house prices are going up is because we have restricted the supply of homes being built, even when demand is rising.
This is why house expenses have risen way faster than both inflation and incomes.
The reality is that most people are willing to cut back on other spending choices like vacations, and kids activities, and many are willing to work longer and retire later in order to earn enough to compete for more expensive homes.
This is a different story than “everyone is doing better” so therefore they have more money to waste on housing.
Instead it is a story of declining quality of life indicators and an economy that has allowed housing to gobble up more and more of household consumption.
> Anyways, long story short: high incomes today bring you far less than what median incomes would be able to afford a generation ago.
That’s because there are more “Zachs” out there today than a generation ago. namely, young people with high incomes determined to own a nice SFH in a great part of a great city. All of that is fabulous news and a great plan. But the numbers of millennials and GenZ in that very same position has exploded compared to a generation ago. This is the same reason that Taylor Swift tickets are unattainable, everyone wants the same thing.
One of the main reasons that home prices have risen so much is that people are doing well, and are able to pay the higher prices, and so they outbid their cohorts to getter a better home. That might seem obvious, yet many people here don’t accept that, and look to “bogeyman” as the cause of the high prices. Fact is, when “umm..really” was looking buy his house, he was likely bidding against “Kristan” and other HHVers in the same boat. They weren’t bidding against any bogeymen[foreigners, satellite families, vacant homeowners, SVR landlords, money launderers, unexplained wealth etc.]
A sign of our affluence… Almost no one here on HHV is looking for a condo, or even a beat up old SFH. They’re looking for a nice SFH, typically in core Victoria, which is one of the most expensive cities in Canada. And the good news is most here will find just that.
This debate about “is 150k a high income” are kind of missing the point. Yes, it is a high income both personally and household, given that the vast majority of Canadian individuals and households earn less. It is also about 30k above the median household income for both Victoria and Vancouver.
The reason why a “high income” doesn’t seem like much is because housing expenses are so high. A generation ago a family earning at or above the median income in Victoria could buy a house at 3-4x income.
Today, with a median household income of around 125k, that would be like buying a house for $500,000.
Fat chance of finding that in Victoria today.
Even some of the cost estimate on here are way off. Patrick estimates 42k for a mortgage? That’s only $3500 per month. Maybe if you bought your house 10 years ago or before rates went up, but not today.
Assuming 20% down, at 4.3% interest, without CMHC insurance you can buy for about 800k with a $3,500 per month mortgage. Within city limits there are only condos listed at this price. There’s a 3 bed in Esquimalt the rest are 2 bed units. All have strata fees over $600 per month.
Don’t forget, property taxes of $250/month, maintenance / strata fees of 600-700 per month (all of the $800k properties listed in this city have strata fees in this range), home insurance $125/month, hydro and water and natural gas $150 per month, home internet $75 per month.
So conservatively another 1200 monthly in standard home expenses or $56k per year in housing expenses, which an extra $14k on top of your estimate. That gets you an old condo outside the core.
Anyways, long story short: high incomes today bring you far less than what median incomes would be able to afford a generation ago.
I’m not in it for the money.
Yeah well we make over 200k/year and I’m surprised that we don’t have more left over each month. Of course I’m grateful but it does make me very worried for people who are actually poor. I went to Starbucks and a pack of a dozen instant coffee is now $16. I swear 2 years ago it was only $9. It’s stuff like that – we notice. Bobby once the youngest is in kindergarten it gets easier – then much easier once they hit grade 6 and can stay home alone.
Max- In the time it would take me to grow my own 20 lbs bag of potatoes, I can make hundreds of dollars. Doesn’t make sense.
More bad news for new condos
https://www.msn.com/en-ca/news/canada/real-estate-agent-seeks-800k-in-commissions-for-units-sold-in-troubled-condo-project/vi-AA1uBew4?ocid=socialshare&cvid=4540c470e33d4b78b4cd119b44d13d07&ei=43
Max, 2 parents working is extremly stressful if you have children especially if you live in the burbs and have to commute.
Two parents working is called a healthy family unit.
Bobby k , I don’t think a lot has changed . Lots of peeps in there 20’s and 30’s are just doing fine . Plenty of people in their 50’s and 60’s that have never owned a home , or made the big income . Senior poverty is also very real. I myself never had a high paying job , never even broke more than 50 g a year lol .
Thank you very much. Not sure how stats canada gets things so wrong – or how we manage on our lower class incomes.
I do agree it is much harder to buy a house now.
I’m just setting the reciord straight for people who think 200-300K is big money, its middle to upper middle class now.
I’m not complaining I am greatful for everything I have, I am juts tired of several people on this fourm who think people in their 20’s and 30’s have never had it so good. Of course every generation has to struiggle at times but 20-30 year olds have it much harder then people 20 – 40 years ago. Good luck owning a home on one income with 1 spouse staying at home which you could do 20 years ago so 2 parents working leads to a much higher level of stress in family.
Dude, your a whiner.
For that couple with 200K income I didn’t include a second car as good luck getting to both childrens activities with only one car, even house league hockey will set you back 3K/year each (registration, equipment, couple of summer camps, away tourament on mainland), play rep hockey or other high level sports 10-20K/year each when you include travel. Also 1 nice vacation is 5K +. Home appliance replacement and renovations like shingles, furnace. Meals out with family. Also how about hobbies like biking (nice bike 3-5K +) or skiing etc. Oh and visit to family across Canada 3-5K every few years.
All of these things of course are not necessary but just don’t call 200K household income wealthly or even 300K as rich nowadays.
Yes there will be many inheritences but I bet in many instances one of your parents lives into their 90’s which means their money may run low or you will get funds when your in your 60’s. I have 4 parents still alive in early 80’s they may be worth 10MM+ but funds may not be passed down for 10+ years and in many cases those children at 60 dont need the funds so pass much of them down to their kids.
You can grow potatoes in your garage year round very easily with a 4′ florescent grow tube. I haven’t tried the led tubes yet. We do all of our vegetable starters from seed in the garage prior to the May long weekend.
My very first ride was a 1972 Duster. She was a year older than me.
Frank, I agree there’s lots of folk with 2 mil in their jeans. inflation over the last 20 years has been very fruitful. Why work when the stuff u own is going up so much. The collector cars I could have bought makes me shudder
10 lbs bag of red potatoes-$9, 20 lbs-$8. Go figure.
My God man, have some empathy!
Top 2% net worth in Canada is around 2.5 million. That would make most boomers in Toronto, Vancouver and Victoria who own their homes in the top 2%. Many of them have RRSPs with a million or more.
I would think that just about everyone in the top 2% got into the RE market a decade or more ago, has received an inheritance or gift from family, or both. Remember income generally doesn’t peak until people are into their 50’s.
Just looking at current income doesn’t tell the whole story.
I hope that is not the case, because it will more than likely out pace salary growth. 5K at 7% growth per year would end up to be 80K property tax in 40 years from now.
Max- I have a banana and some duct tape for $3.2 million, that’s 1/2 price!
Were you expecting a Government handout?
Me too!
I am struggling with the concept that a $200k household able to put $60k a year into investments and that has $2,400 a month leftover to spend on house league hockey is hard done by.
Even dog food is expensive these days. So don’t bank on eating that.
> stand by my statement that 100K or 150K is not a big income or (200K or 300K family) . Here is a working couple making 200K with 2 kids:
Stand by it if you like, but the $200k couple you describe is saving $75k per year using your numbersr. Awesome! That’s $1 million saved in 13 years, and that doesn’t include appreciation/growth.
Here is a working couple making 200K with 2 kids:
Income tax 40K
RRSPs 40K. <——— save $40k
TFSA 14K <———- save $14k
RESP 5K <——— save $5k
Mortgage 42K <——- average save, via equity pay down, $14k
Prop taxes 5K (projected to grow by 6-8% indefinately)
Food and hosue hold misc 18K
Car payment and insurnace (1 car) 7K
I did not include daycare, home insurance, gas, utilities etc..
Why worry about hockey costs? You’re saving $6,500 per month, or $75k per year using your numbers,
Retirement is the killer on finances . Just make sure u have stuff to sell to pay the bills .
Take the townhouse out of the equation.
So basically pay chq to pay chq after retirement/education and rainy day savings while living in a townhouse hoping the car doesn’t crap out. So this is supposedly the life style for a top 2% household in Canada?
Frank. I have rare “Verzameling van een Meenigte Tulipaanen.” Tulip bulbs that I’ll trade straight across for those Taylor Swift tickets.
Purple Tulips. It is no secret that purple blooms are the epitome of royalty! These flowers represent luxury and grace.
https://en.wikipedia.org/wiki/Tulip_mania
Bobby K- But can you afford Taylor Swift tickets. That’s the true test of one’s wealth.
https://www.debtclock.ca/
Retracted
retract.
Well I think the problem is if the average keeps going down then the fact that someone is above it is less meaningful. Money is always and only valuable in relation to what it can buy.
Here is a working couple making 200K with 2 kids:
Income tax 40K
RRSPs 40K
TFSA 14K
RESP 5K
Mortgage 42K
Prop taxes 5K (projected to grow by 6-8% indefinately)
Food and hosue hold misc 18K
Car payment and insurnace (1 car) 7K
I did not include daycare, home insurance, gas, utilities etc..
This leave you with $2,400 month, you better hope your child doesn’t like hockey.
If your family makes 300K you have and extra 4K months after bigger tax bill and RRSP contribution, so 6.4K/months (all aprox.).
No wonder younger people live and home longer and 40% don’t plan on having children.
The only saving grace is that many people under age 60 will be getting very large inheritances.
I stand by my statement that 100K or 150K is not a big income or (200K or 300K family). The average income figures doesn’t account for the large segment of self employed people who keep their income low and leave big money in the corp.
25 years ago I earned over 200K and my income grew by inflation over the next 15 years until retirement in my 40’s which was an option becuase that was a solid income when the average home was 250K in Victoria.
FWIW I will also not get either gov’t handout either as I took large capital gains last year ahead of the tax changes.
A family earning 200k will have about 140k after taxes assuming two sort of equal incomes.
That leaves $11,700/month after tax. Assuming shelter costs of $5000 a month if they own their home and have a 650k mortgage this leaves $6,700 a month for other expenses.
The average family of four spends $4,200 CAD a month on everything but shelter – less if the kids are school aged. This means that the 200k family has $2,500 a month more than the average family to spend or save each month.
Not sure what there is to be bitter about.
East of Alberta. All the way to the East coast…A good chunk of it anyway.
I think everyone is missing the point. If they make the threshold too low, the vote buy doesn’t hit enough of the voter demographic they are targeting. A lot of the chattering class voters that typically vote Liberal, are in that 100k to 150k range. On the federal side, the Liberals really depend on those chubby government workers and teacher types (surprisingly even losing support in that cohort) and guess where their pay lands.
Right on. Good for them (the swifties). I’m all about the long game. Saving again for a second overseas adventure.
Think of all the nerdy people that will be able to put a down payment on a Taylor Swift concert ticket. It warms my heart.
@dad you can certainly take an average of a group (say those earning ~200k). That’s how averages works (they’re not magic just simple math).
Anyway, like most things can’t point to one source as authority for what is/is not a certain standard of living in Victoria. For example, the sources I had pointed to different conclusions about the classes – based on different google switch term. We’d need a reliable source and for it to be broken down by city for it to be truly meaningful.
I stand by my original contention. 200k is not swimming in it where children and a mortgage for sf are involved in Victoria. I think that’s the point/problem. It should be, but it’s not (and I know some people will think that’s how much we make but that’s a misinterpretation).
“It is still wrong, imo, to give $250”
As is giving $500 (BC), and giving $200 (Ontario) to voters.
It seems that incumbent politicians have no shame these days (in other countries, that is called vote buying).
I’m gonna go out on a limb here and say the average household (if you can call it that) earning $200k a year is probably doing quite well.
Not sure why there is all this talk about households making this or that with no reference to data.
As of 2020, the median total income for economic families in Victoria, British Columbia, was $100,000. This figure represents the combined income of all family members before taxes.
Some might think that a household making 200k is not well off. However, in British Columbia the top 10% of households earn $126,000 or more, while to be in the top 5% you need to have a household income over $162,210.
If you are have a household income of 200k you are in the top 2% of Canadian households. 200-225k a year is also about the income you need to borrow a million dollars to buy a single family house here right now.
https://thekickassentrepreneur.com/household-income-percentile-calculator-for-canada/
JT’s ” Christmas ” rebate of our tax dollars is going to add 6 billion dollars to our already massive defecit……Insane!
A house with 200k a year and 2 school aged kids and a mortgage for a sf will not be swimming in it. Not nowadays. But they should be able to pay the obligations and feel only a little bitter that they’re not richer.
It is still wrong, imo, to give $250 to each and every person making under 150k. It should be household income at the very least. Man that’s insulting to poor people.
Interesting, so for a couple making 200k a year with 2 kids that just bought a livable $1.1M SFH. Please show me the math on how they are dog shit with money if they don’t have much left over?
I would say that it’s the people who make far less than that who really understand how much things cost these days.
Maybe if you’re absolutely dog shit with money.
Lol well said, those that think 2/3 hundred grand is a lot of money really doesn’t have any concept of how much things cost these days…..
LOL, I also didn’t know implying that <$4k a year for property tax is cheap and mine being double that amount means I am flaunting my wealth. I could be like Thursty and leveraged to my eyeballs.
P.S. my comment about not getting a subsidy was hours before anyone said anything about 150k. I just know I won’t qualify for any type of government subsidies….
Earning over $150K and not getting the gov’t cheque is one thing, pointing it out to others is bragging about ones wealth.
(as is “Lol damn, only $330 a month in property tax? mine is like over 2x that….”)
It’s high compared to those who don’t get it, and the great majority of Canadians don’t get it.
Now there’s the problem, a household make 2/3 hundred grand a year and there’s not much left over to invest or at least hold onto . As the saying goes , wealth is not income and income is not wealth lol
A household income of $150k would put you in the top ~5% of households. $300k would put you in the top ~1%.
150k is not high income for a household, but if you have 2 people each making that —- I consider that household income to be on the high end. Wouldn’t it count as at least upper middle class in Canada?
150K is not a high income anymore, perhaps it was in 2000 or at best 2010
I wouldn’t doubt some restaurants increase their prices 5% and put the “savings” into their pockets. The consumer always gets screwed.
LMAO, I got 2 kids. But hang on, not getting a government subsidy is now considered bragging about wealth?
We don’t know that he’s super wealthy. Could be he thought it was 150k household income and he’s the single earned with 10-15 kids.
Every silver lining has a cloud: The $250 cheque giveaway gives VicRE another chance to brag about his wealth.
Well especially for people whose housed income is nearing 300k. That is the insane part! I mean, ok fine maybe some rebate for households with an income up to 100k.
My hope is that sanity prevails, and they drop the dumb ideas of the temporary sales tax holiday and the $250 giveaway.
It is more likely to be paid by the current and future borrowers in terms of higher interest rates as the GoC bond yields are not going down anymore.
Don’t think so, this is from the National Post:
Canadians who worked in 2023 and earned less than $150,000 in net income are eligible for the tax-free rebate.
They need to have filed their 2023 tax return by Dec. 31, 2024. Within the tax return filing, they must have claimed the tax credit for Canada Pension Plan or Quebec Pension Plan contributions on employment or self-employment earnings. And also claimed the tax credit for Employment Insurance or Quebec Parental Insurance Plan premiums on employment or self-employment earnings.
No talk of per household.
Not seeing how the national debt would effect me much . It is what it is . Along as the economy is humming along good enough
@Westerly that must be household income. If not that is crazy!
Dee, “Btw how do we know if we qualify?” So far it’s every person that worked in 2023 and earned less than $150,000. I’m assuming that’s per person per household. We’re under $150k each and expect $500 between us.
Kristan stop thinking that MMT is similar to personal debt.
https://youtu.be/c2heaQdjTZQ?si=iHPzOyMcS5TsS4GG
South of the border, debt obligations now exceed spending on national defense.
Does anyone here understand MMT (modern monetary theory, the set of ideas commonly invoked by Western governments that justifies overwhelming amounts of debt and printing of money) to be able to give a defense of it that doesn’t sound like a combination of voodoo and hide the ball?
I do wish things were just cheaper overall rather than getting strange Christmas bonus from government. Btw how do we know if we qualify?
These cash rebates are obviously going to be popular but they are a sign of a failing government at the federal level.
Prior to the handouts, the house was in a permanent state of deadlock because none of the other parties would work with the liberals. The NDP like the optics of cash handouts so now they might agree to loosen things up for a bit.
Meanwhile cash handouts are terrible policy. Thinking Canadians need to ask where this money will come from? Debt of course.
The federal government already has massive debt obligations that are growing because they have been continuing with huge deficits year after year.
This is going to be catastrophic for the future. Expect to see higher taxes and/or lesser services and benefits from future governments for a long time.
Good for you, I won’t get a dime. Spend my tax dollars wisely please!
Mt tolmie, yep pretty much but then again I think most western economies have had the same game plan
By flooding the economy with cash, leading directly to inflation, causing people to invest in real estate as a way to hedge, leading to a bubble, which attracted speculators, driving real estate even higher, leading to more inflation, etc.
Thursty, “Ya, the house inflation has been great under JT. It’s the one good thing he’s delivered”. Maybe I’m late to the party. Exactly how has he delivered this?
Again, depends on one’s perspective. At the beginning of the pandemic you could have bought a million dollar property for 143 bitcoins Today, around 10 bitcoins
Frank , yep it sucks but there are still ways to make it work and get ahead . I’m constantly floored by what people are paid today .
Depends on one’s point of view, not so great for people wanting to buy a house, even rent an apartment. It’s called inflation.
Ya, the house inflation has been great under JT. It’s the one good thing he’s delivered, but overall I have no complaints , I’ve enjoyed the ride
Which contributed to the unaffordable housing crisis and increased homelessness. Not exactly an improvement for many people, except the rich got richer..
How much has your house increased in value over the decade of JT?
115%
https://youtu.be/0WCkeQzlQDw?si=teySex-q3gvGklic
Meanwhile, in the art world….
https://www.msn.com/en-ca/video/news/duct-taped-banana-sells-for-62-million-at-art-auction/vi-AA1usVCm?ocid=socialshare&t=38#details
I don’t agree with anything Trudeau has done over the last ten years. People who need $200, need $200,000. He’s treating the public like children, giving them a raise in their allowance. Pathetic.
I also don’t agree, it just obscures the fact that we are over-taxed in the first place. We’ll get $500 in our house and while it’s nice to have, we won’t notice it. What we will do is put it into our RRSP, possibly an RESP, or maybe even through our adult kid’s FHSA. Wherever it goes it will not be spent (sorry JT) and any tax credit the contribution generates will also go back through the registered accounts.
i was a buyer in a private sale over the summer. i’d actually reached out to Marko to look for SFHs in vic, and would have otherwise happily worked with him, but found out a friend of a friend was planning to list a unique property in cobble hill. horse facilities, riding ring, sfh. a niche place that wouldn’t appeal to most due to % of land being horse focused, but finding a turn key ‘horse home’ under 1 mill is so rare for those who do want it. we jumped on it, had it inspected and worked with a lawyer, and got it under 900k. smooth process. me and the old owner sorted the negotiations over fb messenger (well the wife and i, both the horse people, the non-horse husbands on both sides left it to us. must be a horse people thing haha)
Nor do I, it’s apparent that most of the benefit will go to people who don’t really need the money. An increase in the GST credit, which is means tested, would be far more cost effective.
But maybe that’s a feature not a bug. Doug Ford is going to “give” every man, woman and child in Ontario $200. Ho ho ho.
Patrick, agree we have a slow economy in bc and Canada at large and not a lot of concern for ballooning deficits, these are just dumb announcements
I am not doing anything, I was describing a hiccup that often occurs in a private transaction – the buyer is not qualified or does not have the means to purchase.
>> >>>>>> Thanks for the link Marko, it appears to me that the report defines “multi-unit building” as any building with 2 or more legal dwelling units, which would include a lot of what we would call “SFH” these days, i.e. with a purpose built suite.
ChatGPT seems confident that a new detached house with a suite would be considered a SFH in CMHC housing start. Not sure whose stats the report you quoted are based on, but CMHC is the common source. ChatGPT could be wrong of course, but you’d need to find something to indicate that. The Victoria builders association reports similar dismal SFH starts quoting CMHC numbers. We are down 16% overall from last year. And they point out the dismal SFH numbers, and state that they are mostly in west shore.
Re: CMHC housing starts “ This distinction is important when analyzing housing starts:
1. Single Detached House: A stand-alone dwelling unit with no shared walls, even if it contains a secondary suite.
2. Multi-Dwelling: Refers to buildings with multiple units under a single structure, like duplexes, row houses, or apartments.”
He’s trying to buy votes. In a few months he might have to get a real job.
I don’t agree with either of these measures from our “spendthrift” federal government… I consider both of them “wasteful and ineffective”
“ Prime Minister Justin Trudeau announced on Thursday that his government plans to temporarily lift the federal sales tax on a range of items, including toys, diapers, restaurant meals, beer and wine, from Dec. 14 to Feb. 15. The government also unveiled the “Working Canadians Rebate,” which would provide Canadians who worked in 2023 and made less than $150,000 with a cheque for $250 in the spring.”
Ok so you are not actually helping them come up with the money, you are just advising on the market value.
Don’t know about that, whenever I’ve registered our new SFH builds with suites it has been “one dwelling” enrolled with home warranty. My interpretation 2 or more legal dwelling units means two PID numbers (strata duplex or larger). A SFH with a suite or a garden suite does not have two PIDS.
Thanks for the link Marko, it appears to me that the report defines “multi-unit building” as any building with 2 or more legal dwelling units, which would include a lot of what we would call “SFH” these days, i.e. with a purpose built suite.
SFH starts are looking really bad (page #6) -> https://www.bchousing.org/sites/default/files/media/documents/New-Homes-Registry-Report-October-2024.pdf
22 year low, but I am guessing if we had stats probably a 50+ year low in BC?
I’ll go back to what I’ve been saying for the last year or so on HHV if you want a SFH and can qualify to afford one I would personally buy sooner than later. I would bet $ that 2025 we hit a 23 year low in terms of SFH starts unless there are some huge SFH subdivisions in Surrey or similar I am not aware of.
100% one should always be open to a private deal. That is why I don’t ask my buyers to sign a buyer’s exclusive contract. If you are looking to buy a home and I’ve been showing you homes for three months and your co-worker offers you a great private deal you should probably consider it for sure, even if it sucks for me 🙂
One would think you would see private deals with condos at least as they are much easier to put a value on than SFHs.
I agree it’s not that common Marko and not appropriate for everyone or every sale. We still use realtors but always open to a private deal. And agree re: interest from neighbors. The first property we became interested in buying years back was a family we had known for years (this was an estate property). Sat down to negotiate with the heirs and they (or maybe we) were out to lunch on the price. I don’t recall what it actually sold for but we didn’t go back to the table after it was listed.
Sellers tells neighbour they will be selling and neighbour says they want to buy the property; however, when the neighbour starts looking into it they can’t qualify to come up with $1.2 million to purchase the property. Or a lot of the time the neighbour if he or she isn’t following the market might think the property is worth 900k when market value is $1.2, for example.
2375 lund road at 960k is pretty reasonable. Nice family home for 2 government/public sector workers.
How does a realtor help clients come up with the money? Never heard of that one before, are you also a mortgage broker or have one that you partner with?
But also much more difficult to assign a market value on properties above $1.5 mill. Just look at original ask and final sale price on higher end properties not unusual to see a 500k+ spread between those two numbers.
In theory, 100% agreed. In real life practice seller typically is not realistic, or buyer doesn’t have their crap sorted out, etc.
Quite commonly when I list properties the seller will say my co-worker or neighbour or whatever is interesting in buying the property how much commission would I need to pay if such happens. I just tell them give me the names I’ll exclude them from listing contract and commission payable will be zero if they purchase and it hasn’t bit me once in 15 years of selling real estate. It’s not worth my time to even discuss, just give me the names and let’s move on to other paperwork. People talk a lot, but then reality sets and neighbour realizes coming up with 1.2 million or whatever the price may be is not that simple.
Here is another real life example that happened to me this past summer. Long time clients of mine came across a vacant property not on the market so they contacted me, I pulled the title for them and they sent a letter to the owner’s address on title. Owner phones them back and was planning on listing the propery in the coming months. To make the numbers simple owner wanted 1 million off market. My clients offered 950k unconditional privately with no agents and seller didn’t take and went to market. A month later my clients purchase it for 955k with me as their buyer’s agent and the seller had to fork out 30k in commissions so seller netted 25k less but they simply had to go to market to accept what the propery is real worth.
Have I had clients buy off family, co-workers, etc., yes or course. Is it common? I don’t think so.
Super common to buy privately in Croatia where there is no MLS system.
I recall Leo measuring that 20% of RE transactions are “private” in the sense they are outside of the MLS. Various reasons , (selling new condos, private owner sales, family transactions etc.) Many of those don’t involve RE commissions. But any stat about mls sales only represents about 80% of the total sales.
I’ve had no problem buying privately, but no luck selling privately. One of my friends has never used a realtor to sell their homes, probably 5 or 6 in their lifetime, all principal residences. He does have 70 cousins and tons of friends. He should have been a realtor.
We’ve bought and sold several properties over the years without realtors involved. It’s not complicated. There’s generally been a known connection but not family so far. When properties get into $1.5 m plus fees matter!
Highly doubt this happens a “fair amount.” Most sellers are overally optimistic in terms of market value before they go to market and then reality sets in.
Another opportunity arises when you are aware that a property is coming on the market and you can work a deal privately. We have done this twice in Victoria. Friends let us know a neighbour was interested in selling and we made fair offers below market. We were very aware of the market conditions and selling prices in the area. Leaves out the realtor commissions of course for the seller. I think this actually happens a fair amount in Victoria. Be interested if Leo has any stats on private sales.
The only “deal” I’ve seen in RE is buying from family. No realtor, no PTT. Pretty rare scenario though.
Since I’m in city center and he’s way out in the sticks…I think I would be the winner. Metchosin has insane property taxes due to the low population. I don’t really think they cared much for price appreciation, they were just empty nesters and wanted some tranquility. I have sewer they have a septic field, I have natural gas they have a 200 lb propane tank.
I consider myself tremendously lucky to have made it out!
Peter- Bail out of your equities if the Dow hits 50,000. That has got to be the biggest bubble in history. I remember when the Dow was 700. This government spending can’t go on forever, our money is buying less and less every year. Question is: where to hide?
The good old days of making the double-ending work for you, way to go!
We did well with RE including investment properties for some 30+ years, but now in retirement, I vastly prefer a simple life, no debt, no tenants, certainly no private lending – collecting dividends and augmenting with a diversified portfolio has been easy as falling off a log. Yes, there will come some major drawdown, but even that isn’t my first rodeo.
Max- What is the comparison of the value the the properties today (according to assessment)? Who got the most appreciation?
It was on market with my Realtor. It was a well cared for house. It was exactly what I was looking for 2600 sq/ft house 10,000 sq/ft lot.
The Realtor didn’t know what I was up to and was shocked that I wanted to check out their house, but he let me through for a showing. I thought about for a day. I knew they needed a full price offer to make my deal work. I let him in on the plan. I knew he was double ending.
I just told him I don’t care…Make it work. And it did.
Max- Did the house come on the market or did you buy it privately? Great story,
Max, that’s a great story , timing is everything.
Because I was dealing with a bank not a private lender and I was running out of time on my construction loan. I put all my personal saving into the build and there was no action for the better part of 12 months. I was in trouble. That one conditional offer saved my sorry little ass. I came out with exactly what I was searching for to begin with. A good solid forever house.
Remember I was only 25…I didn’t exactly have a lot of money back then.
Why did you have to buy their house or lose your shirt?
Its risky business. I was sitting on a spec house out Metchosin. Beautiful house, four acres. I arranged my financing through the Laurentian bank. It was a shady little bank on fort street that did deals. I was living in the house having mail delivered and such for the capital gains exception. I was asking $400k and I had been there for almost a year. I finally got an offer and it was a full price offer subject to the sale of their house. I phoned my Dad asking what I should do. He said go check out their house. So I go check out their house using my Realtor and they wanted $240k.
So I phone my Dad and he says what did you think and how much? I said it was a great house and they want $240k. He says well then buy their house otherwise your going to lose your shirt. He knew by closing this deal I would have enough for the 20% down payment (for a traditional bank) plus around 15k in my jeans. My Realtor didn’t know how to handle it (he just wants to get paid) he had to go to the upper echelons to figure it out. This would have been in May 1998 for reference.
So here I am, in that house and that pretty much put an end to my spec house building days. And I couldn’t be any happier.
Frank , in the mid 80s I was paying north of 20 points on a construction loan . Short term money is always expensive , seemed reasonable back then
Max, ya good stuff , hard work and along with risk pays off. I just had a talk with my kids about risk and I don’t think it moved the dial , there’s no appetite for it lol
There was very little skin in the game. I’ve paid 15% and still made good money on the other end.
539 Castleton is classic. Bought at the peak for 1.65 and trying to unload for over a year. Original realtor wasn’t successful so got a new realtor and deceased the price by another 50k. Chasing the market down from 1.75 to now 1.5.
I was in my very early 20’s and the money looked pretty damn good to me. All I had at that time was a girlfriend and two dogs. I was just working as hard as I could for a down payment for our very own SFH and It paid off. I had a 20% down payment saved at 25 years old. No CMHC insurance, using a traditional bank, girl friend with a provincial government position combined with my self employment income, bought our very own SFH in 1998.
And we’re still here!
Vicre, family business , I’m 3rd generation. The kids , early thirties don’t share the same enthusiasm unfortunately.
I could never pay 12%. There’s easier and safer ways to make money with little investment.
How do you pass down debt?
Max , ya not big on partners , I find when things go well we are all friends and when they don’t , it’s an ugly battle .
My private lender back in the day was a plumber. He was first position on title. He would give me a start up draw to get me to lockup, then upon his personal inspection would give me a second draw to get me through to occupancy. He was a great guy, I paid him 12% for the use of his money.
Thurston, “private lending can get sketchy , think greg martel…” Ya, no intention of doing that, “Private lending” as in secured on title, max 65% LTV, 1st mortgage lender. I’m sure there other risk issues to identify but that’s where I would start.
Frank , I had 2 friends that sold just before the pandemic and buy down , they short changed themselves with hundreds of thousands . I will stick with our family tradition of passing on lots of debt lol
6-3031 Jackson st is listed for sale. IMO this is a great example of a missing middle property that we could use a lot more of:
– family friendly layout – 3bed/3bath
– small yard space, garage
– proximity to schools, parks, amenities
– NOT on a busy road but walkable to transit
– at or around $1M
Unfortunately, divesting of one’s assets is sometimes inevitable. Boomers are dying off and their heirs typically want the cash to pay down their debts (we are heavily indebted) or spend it like drunken sailors. RRSP’s will be cashed in, and properties sold. I’ve recommended to people I know to hold onto their parents homes, rent them out, and watch them appreciate. None of them did. The cash was burning a hole in their pocket. Property will always be in demand, I think that stock markets could take a big hit in the next 5 years.
westerly, private lending can get sketchy , think greg martel . once u hand over your cash for private placement u loose control of your money. i dont like the clients and i dont like people working in that market.
One other thought I’ve had if divesting the RE is to become a lender rather than borrower. There’s pretty good money in “private lending” and it can be done through the TFSA. Haven’t concluded anything on it yet, but could be a way to stay in the game while reducing market exposure / risk with tenants etc.
Imo, divesting going into retirement is the wrong strategy. I would much rather hold and borrow against it. I think right now is an excellent time to leverage and grow your holdings , and I’m not that young
I think you summed it up Frank. Our kids are at the buying age and we are “net selling”. We’re not far behind you and not planning any new purchases ATM. Also not keen on being a landlord for the next 20 years as we cruise into the sunset (although we may keep one rental). Most of our net worth is tied up in property and we are looking at consolidating it into a forever home plus stock investments.
An interesting post would be at what point in life should one invest or divest in real estate. I don’t think anyone near retirement should start investing in property. It’s something best to do when you’re younger (I was 34). My last purchase was in 2017, I was 62 and sold a property to buy this one. Definitely looking more towards selling than acquiring any investments, time is not on my side if things go south.
Max, lol I’m more gilligan than thurston unfortunately
Are you still with Lovey?
Worked well on our purchase. We even had it more simple. Didn’t mention recission period, all it stated that we had access could access the property 4 times on 24 hours notice before the close date. Had AO on a Friday, so it stretched the recession period and extra couple of days. So, the inspection and appraisal was all done before the end of recession period. Worked well for peace of mind since we went unconditional. We also went with a 10% deposit.
I’ve had it work really well; sellers are thinking why would anyone walk from the 0.25% – this is as good as sold.
Sometimes you are buying a condo and you can review the strata documents ahead of time, sometimes the inspection doesn’t matter (you’ll tear down the house), etc.
Last few deals I’ve done have been unconditional with a open closing date and it seems to go over swimmingly
So regardless that requires approval from the seller?, I wonder if defining access during recession period doesn’t work as well as straight up unconditional? Having money on hand to close is the straightforward part, making sure you are getting a house without issues is the tricky part with unconditional offers.
You can pre-inspect, you can define access during rescission as including appraisal, inspection, etc. This approach defintively is not for everyone.
It is a weird market, there are no shortage of multiple offers bidding up good houses which are priced to market while the shitty houses are sitting. In past downturns good houses were also sitting for a long time without multiple offers even when properly priced. This indicates to me that there are lots of $ on the sidelines looking for a particular product.
So you are saying unconditional but with a condition to access within the recession period? I guess since you are a builder you can spot major issues from a showing but most folks not in construction would most likely want an inspection done.
Aren’t the sales to list ratio and days on market the indicators of a buyers/sellers market? That is what we pay attention to. Buy in a buyers market. Sell in a sellers market.
For those thinking of buying or selling in the next few months, Alex Carroll has a good summary of the market.
https://youtu.be/HHSCsDX4lqQ?si=HYxmlFnXcZgPaSWv
Long time lurker, it appears sales are tipping up everywhere. New home sales are a laggard but with lower rates I’m sure those will follow. Thursty has been really spot on in his astute analysis.
and at least there is the mute button.
Incredibly well written post – I agree with everything you’ve said.
Just to give readers an idea a SFH with a suite under $1.2 million in the core will be in the search criteria for 3,000+ automated listing search systems agents have set people up on. You simply aren’t getting a spectacular deal in this day and age.
The one topic you didn’t touch on is unconditional offers. I’ve been writing a lot of unconditional offers this year for saavy sophisticated buyers and it is agreat way to knock another couple of % of the purchase price in my opinion. I discuss a recent real life example in this video -> https://www.youtube.com/watch?v=j-UrdB3S8P0
Personally I am going to be make a few offers in the next couple of months and 100% I’ll only be writing unconditional combined with leaving the offer open for a super long time (3 to 5 days) for the sellers to chew on. Just think it through the perspective of a seller. They’ve been sitting on market for months, the New Year is approaching, and offer them lower than their bottom line might have been but unconditional, you’ll complete in 10 days so they’ve have cash in their account in 11 days and esspecially if they have a tenant and you’ll take the burden of that tenant over and then you give them lots of time to think on it. You also are saying to the seller I’ve left this unconditional offer open for 5 days – feel free to shop it around to see if you can do better. I find it works really well in real life pratice.
The best part is the offers really aren’t unconditional thanks to the government so lots of upside, but limited downside risk.
“True Value” is Market Value. What you pay for a property is Market Price/Contract Price. Most of the time Market Price and Market Value are equivalent, however if the housing market is strongly in favor of buyers or sellers then the two may diverge. Further reasons why price and value may differ can be found in the definition of Market Value below.
MARKET VALUE:
The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and the seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress.
Note that real estate commissions are not included in the definition as an agent(s) facilitates a trade between buyer and seller they don’t add or detract from the Market Value of the property. The home seller pays the commission negotiated in the contract with the listing agent. Market Value is the same whether there is a listing agent or not involved in the transaction.
For me it’s buy in the fall and sell in the spring. I like the fall market bc I think some sellers start to panic thinking if they don’t sell now they will have to wait until January or February. I also like fall because im more likely to see houses that stick around that seem more defective than they are. That being said I’m sure Leo is right and overall it doesn’t make a huge difference.