Renters struggle as prices soar across Canada April 10, 2018
This is in response to the article written by Linda Givetash which can be found by going here:
To start what I find interested is the section where the writer states the following:
The Canada Mortgage and Housing Corp. says average rents nationally went up last year by 2.7 per cent to $947 per month.
In case you didn’t know The Canada Mortgage and Housing Corp is CMHC, the biggest disaster to have hit renters in Canada. Personally I don’t have a problem with rents rising, I don’t have a problem with housing prices rising, what I do have a problem with is the government insuring both industries. Most Canadian cities have rent controls, I’m against rental controls but that’s up to the Canadian voter to decide. On the federal level exists the Canada Mortgage and Housing Corporation (CMHC) which is a Crown corporation of the Government of Canada.
So people understand, what this means in simple to understand terms is that the housing market is protected by the Canadians tax payer, Federally, provincially and on a municipal level. Now if you’re an investor or a housing or apartment building developer would you
(A) Build condos, condo town homes for people to OWN?
OR
(B) Build apartment buildings or townhouses for people to rent?
If you answered (A) you’re absolutely right.
So guess what happens when condos are built? Guess what type of person buys up the condos first? If you guessed real estate investors ding, ding ding you’re right again.
Guess what real estate investors base their rent prices on? If you guessed the amount it costs them to pay for the mortgages and maintenance fees for their crappy condos? ding, ding ding you’re right again.
So when this happens guess who can’t afford their rents? If you guessed single Moms who live in a one-bedroom apartment on Vancouver’s east side ding, ding ding you’re right again.
This is common freaking sense and I’m irritated that Canadians can not see this. It’s common freaking sense. You can’t have rental controls and CMHC a Crown corporation of the Government of Canada protecting the housing market. Protectionism mean less competition. If you protect 2 industries and ask the private sector to choose 1 the private sector is going to choose the one that has the lowest costs. It’s common freaking sense, everytime a new condo gets built lives are being destroyed, prices are being eroded and future disasters are being created. This is not a a laughing matter Canadians are in debt, in variety of ways and we are in the early stages of this disaster.
I keep on saying this and I’m going to keep on saying this again HOUSING PRICES CAN NOT BE STAGNANT, HOUSING PRICES CAN NOT GO DOWN. If housing prices do not go up there will not be a crash there will be a collapse. The government can not tax people already in debt, being in debt means you’re pushing your productivity to a later date. If a person has a million dollar house or a half a million dollar condo and they learn that they’re stuck and they can’t sell and the have a renewal date where the bank tells them that their mortgage is worth more than their condo or house will sell for, the game is over.
It’s not a crash, a crash means it can be restructured. This disaster can’t be restructured, there’s only one option left and that’s 100 year amortizations. That also means being stuck, That’s what Japan has, but at the very least Japan is known for it’s quality products, it’s quality industries. Canada well we’re taxing our industries into oblivion and replacing them with Government jobs. Canada also doesn’t have nearly as much people as Japan does. I’m not sure if the Governor General of Canada is our equivalent to the Emperor of Japan but Canada is in a very serious threat of economic collapse and from an outsider perspective it’s going to be a very sad day in history.
These high rent prices are the first signs of a collapse brewing, Liberal followers, employees and parasites of the government you’re running out of people to tax, you’re running out of industries to nationalise and technologies are making your 1990’s style socialism a relic of the past. Paul Martin was the last intelligent Liberal mind, he created loopholes for a reason. Trudeau’s Liberals are trying to virtue signal and regulate everything in a time where in my opinion it’s all going to backfire. Based on what I’m seeing, if I were the Conservative party I would throw the election and leave the collapse to the Liberals.
I want Canada to see how incompetent these people are, I mean let’s be honest the free market could have done this and at the very least the people responsible for this mess would be bankrupt in the end. But see with the CMHC and rental controls backed by the taxpayers, bailouts are a reality all the financial institutions in Canada are betting on it, regardless of whose in power when the crash happens that government is going to have to bail out the banks. It’s why I say housing prices can’t go down! It’s GAME OVER if the housing market in Canada gets stagnant let alone depreciates.
Maybe Canadian home owners can hold on for 1 year of hearing their mortgage is higher than their house will sell for, but what about 2 years of bad housing news, 3, 4 or 5 years of being stuck in an overpriced home/condo that you can’t get out of without taking a massive financial loss? haha! In America when homeowners heard the news they simply walked away. In Canada many areas don’t have Foreclosures they have Power of sales which is interesting because that opens the door to lawsuits. Because when a housing market is as subsidized as Canada’s is who or what determines market values? If a bank sells a house in a Power of sale process at a huge loss what happens there? What is market value? In Ontario is it MPAC? I’m not sure. Sounds like government intervening to me.
If conservatives want to inherit this mess well, whomever takes over from Trudeau better warn Canadians what’s coming because there’s no escaping it! This is a disaster and it’s getting closer every single day.