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Cost of housing in Canada

Bruce Monkhouse said:
"Everything was custom built for our family"

My interest went down after that, .......yes, the bank rate thing truly sucks, but no one was forced to spend like their hair was on fire.
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Is that a thing ? When people's hair is on fire they make rash and poor financial decisions ? Lol
 
Bruce Monkhouse said:
"Everything was custom built for our family"

My interest went down after that, .......yes, the bank rate thing truly sucks, but no one was forced to spend like their hair was on fire.
Click to expand...
"It's not like we're struggling for work or anything. We make good money. We have good jobs, but it's just, we want to be able to live our lives and not be putting every dollar toward a mortgage"

Sounds like a sob story as of this line to me. You overspent, you took the risk of a variable rate, and now the piper needs paying.

I'm not heartless, I have some sympathy. But there's going to be an awful lot more of this going on. The times were too good for too long, and people forgot how to live within their means.
 
RedFive said:
The times were too good for too long, and people forgot how to live within their means.
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I don't necessarily disagree but I think it's more fundamental than that - people don't know what it MEANS to live in their means. There is no financial education of any kind at any level. If you don't understand interest rates, compounding savings or even the most barebones basic budgetting then you're going to be struggling forever.
 
In all fairness, back in 2020 bearded face Trudeau stood in front of a mic and refused to answer a question of what would happen if rates went up, considering all the debt he was taking on. The MPs and banks forecasted low low rates for years to come… so people went nuts and maxed out their affordability. Like with everything choices have consequences, but the gov was peddling low %s. Never trust a liberal with fiscal policy and responsibility.
 
shiska said:
I don't necessarily disagree but I think it's more fundamental than that - people don't know what it MEANS to live in their means. There is no financial education of any kind at any level. If you don't understand interest rates, compounding savings or even the most barebones basic budgetting then you're going to be struggling forever.
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We're in violent agreement.

Pair that with banks and the government keeping interest rates artificially low and not only enabling but encouraging Canadians to take extreme amounts of debt while printing boatloads of cash and I foresee a very big back blast on this. I am in no way shape or form an expert, its just a gut feeling. We're in for a rough ride as a country.
 
The worst part for people who default on mortgages is the debt doesn’t disappear with the house.

Unlike the States where you can give the keys to the bank and walk away in Canada the bank forecloses on the home and whatever the deficit is after it sells, you are still on the hook for.

The only way to actually escape that remaining debt is to go into bankruptcy, which means basically all the rest of your assets will be seized. Many had to have family members (usually parents) as guarantors, which if there is a few hundred thousand of debt left over they will be on the hook for. Overall it isn’t a good picture for many.

I just renewed my mortgage, it went to 5.6%. Just a idea of what its looking like at the moment.
 
Eaglelord17 said:
The 2500 sq ft houses as much as I generally hate them make sense in some regards from the change in social dynamics. People spend much less time out and about, the home has become your outside. Add in all the work from home requirements and now you also need office space within your home.

One of my family members has a home with likely about 3000sqft of space for 3 people. It made sense when they had the 4 kids, but after 3 of those kids left its now mostly unused poorly maintained space. Don’t you dare mention to them the idea of downsizing though.
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I live in what would qualify as « huge » I guess.
Eaglelord17 said:
The worst part for people who default on mortgages is the debt doesn’t disappear with the house.

Unlike the States where you can give the keys to the bank and walk away in Canada the bank forecloses on the home and whatever the deficit is after it sells, you are still on the hook for.

The only way to actually escape that remaining debt is to go into bankruptcy, which means basically all the rest of your assets will be seized. Many had to have family members (usually parents) as guarantors, which if there is a few hundred thousand of debt left over they will be on the hook for. Overall it isn’t a good picture for many.

I just renewed my mortgage, it went to 5.6%. Just a idea of what its looking like at the moment.
Click to expand...
my very first mortgage in 2001 was about 5.4%. People just got used to abnormally low rates for a long time. But it’s not rates per se, it’s the house values that are a bigger issue.
 
Remius said:
I live in what would qualify as « huge » I guess.

my very first mortgage in 2001 was about 5.4%. People just got used to abnormally low rates for a long time. But it’s not rates per se, it’s the house values that are a bigger issue.
Click to expand...
It's intentional, housing is viewed in Canada as a retirement savings plan rather than a necessity. If the government did anything to drive down the value of homes, home owners who need the value of their house to stay high for retirement would riot.
 
Remius said:
I live in what would qualify as « huge » I guess.

my very first mortgage in 2001 was about 5.4%. People just got used to abnormally low rates for a long time. But it’s not rates per se, it’s the house values that are a bigger issue.
Click to expand...
Exactly, for me that just about 2% raise in rates translated into about 55 dollars extra a payment. My principal is not very high though.

If I had a big principal and a low rate though and was struggling as is, I wouldn’t have the warm and fuzzies.
 
Eaglelord17 said:
The worst part for people who default on mortgages is the debt doesn’t disappear with the house.

Unlike the States where you can give the keys to the bank and walk away in Canada the bank forecloses on the home and whatever the deficit is after it sells, you are still on the hook for.

The only way to actually escape that remaining debt is to go into bankruptcy, which means basically all the rest of your assets will be seized. Many had to have family members (usually parents) as guarantors, which if there is a few hundred thousand of debt left over they will be on the hook for. Overall it isn’t a good picture for many.

I just renewed my mortgage, it went to 5.6%. Just a idea of what its looking like at the moment.
Click to expand...
Nobody seizes assets in a bankruptcy in Canada (what would they do with it all?). Unsecured debts are discharged in the process, but nobody walks around wearing a barrel.
 
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