The HOT Truth About The Canadian Housing Market

The HOT Truth About The Canadian Housing Market

[Music] hey everyone welcome back to the mark lawfuller experience we got andrew hines here again and it’s your monthly update i guess that’s uh we seem to be doing this every month or thereabouts yeah uh yeah and we’re going to be talking all things canadian real estate sounds good what are you seeing out there like well mark i was catching up on your last video and i i was wishing that we could have debated right there and chatted about it because um yeah there’s there’s a lot of the same going on in canada like across the board we’re seeing sales come down a bit but we’re also seeing inventory down and sometimes at far lower than uh five year averages yeah which uh so the problem is is persisting here we’re seeing a real lack of supply and that issue isn’t going to go away no matter what we do to demand well and so if you guys didn’t catch the last video basically i was arguing that well i was i was reading from two reports one was a td bank report one was the scotia bank report the scotia bank report was basically saying we have a systemic problem in canada is where we do not have enough housing and we are not building enough housing we’re not building enough right so so i know we’ve talked before about the municipality issues we’ve talked about about the fact that it’s it’s tough to get building permits it’s tough to uh to get approval to develop new areas um and the fact that we’re green belted and it’s we have a lot of nimbianism not in my backyard so we don’t want to go you know the whole point of the green belt was to densify right that was the whole point was to put more density on on less space to protect our green space and our farms and which i’m all for but we do need to go ahead and identify it but we don’t have a partnership between all levels of government but that that that’s honestly not why we’re no no we’re yeah those are inefficiencies for sure so yeah yeah we we can get into some specific stats if you want you guys comment down below is this why you do you just come to hear andrew and i talk because these are my most watched videos so i mean basically what’s going on you guys have probably seen it all out there is the fact that like prices are down right prices have come off their highs um which we kind of talked about this back in march and like february march uh april we were talking about this that i mean we basically saw a 10 increase in prices between january and february yeah and a 10 and one month increase is it’s unsustainable absolutely so they had to come down a little bit and i think what we saw and the trend that we were hearing from different realtors you know kind of uh the word on the street was that there were less bidding wars so yeah and that’s the emotional factor right if you take that emotional factor the people that are just so attached they’ve lost out on five houses if they have less bidders that they’re competing against they’re more likely to get the house that they looked at and less likely to get frustrated and pay too much so i think we’re seeing a little bit of that happening but there’s still that lingering supply issue i’m gonna put this out there that so i mean just what’s on the screen right now you can see it so there’s a like a 9.5 difference february from january to february and then another what’s that 5.5 from february to march that’s that’s like a 15 increase in two months yeah like if we saw that over three years i’d be super happy with the real estate market so obviously there was had to be a reversion to the me um so like you look and you go okay from january was 6 18 and now it’s you know 660. to me that looks like okay we’ve reverted back to the mean we’ll never fully get there though i don’t think personally i don’t think we’re ever fully going back to say where we were oh no no we’re not going to get back march 2020. no we’re we’re not going back yeah but i’m just saying so coming back to them so the mean yeah is basically what i mean so there’s i mean it’s government policy to inflate the money supply inflate the housing to have that go up over time it’s just government policy and again with lack of inventory that’s what’s going to have to have to happen but basically you’re going to see a price scale like this and that they want it to stick to that price scale so it’s going to pop up it’s going to pop down so i think we popped up and then i think we popped out i think my prediction for august is we’re going to see a price a slight price increase in overall value okay from yeah so we’ve been trending a little bit down you think we’re going to come back up yeah i i i’m predicting that more for fall i really do think you know you’re going to have that normal cycle because in any normal year we typically do have a little bit of a trough in july august because everybody wants to go on vacation we’ve had a really nice summer so i got a while here here’s the thing that most people aren’t talking about is this is the second best july ever for home sales okay like it’s not like it was like this horrible thing it’s just it sucks compared to 2020 because well we didn’t have a spring market and a lot of the sales from march and april got pushed into june july august so yeah the sales are going to be down but nobody’s talking about is that it’s the second best year for sales ever so there’s still a heck of a lot of home selling out there and people aren’t listing right now yeah so we’re elevated over the five year average on the sales but we’re still following that trend where we’re troughing a little bit now even though it is way up overall and then i think we’re coming back up again yeah in the near future i honestly don’t think we’re going to see 10 to 15 or 10 5 10 increases it’s just not sustainable it’s not sustainable and there’s there’s that same affordability issue that we’ve talked up talked about before there’s only so far that prices can continue to go up before people can’t afford it right but i mean the government will take credit uh or whoever will take credit for this coming back and they’ll say oh it’s our um it’s the new stress test that we put out in july which i mean we’ll link the video that i did on that one saying basically it’s a bunch of crap it’s not going to do anything and it didn’t do anything last time um but it’s just another another measure to affect demand all government seems to be able to do is just try to you know effect demand either tax it or or do something to try and control demand without addressing the supply issue and creating efficiencies there that are going to allow us to build more units well and i mean i guess that’s what it comes down to and i mean we’re going to be broken records for a long time i think because i i i don’t see anyone really taking this on a national provincial a a municipality level very seriously no not really and and then beyond that there are layers to the issue too right just getting labor we were just talking before we started the the video is that it is getting harder to get labor and then of course no one’s really encouraging uh young kids to get into the trades so uh this problem is probably gonna become more exasperated listen if you’re 17 18 watching this video and you want to become a plumber or an electrician you can you know basically start an apprenticeship today and be making 50 60 grand your first year and then like by the time you’re out of that four-year apprentice which they’ve paid you to do you’re making a hundred plus a year and you could probably own about five or six rental properties by that time exactly whereas the other people go to go to school until they’re 22 at least or 21 22 and then they’re coming out with a load of debt and they’re still starting at 50 and still having to learn street smarts right so while you’re working in plumbing or one of those trades you can learn the street smarts you can learn how to invest from people by going to networking events for me with my kids i’m going to go the other way i’m not telling them to go to university i don’t care my kids are going to probably going to go to university if they want to they will but yeah i mean i don’t care what they do like if they want to go into the trades or they want to go to university my whole thing is you gotta learn how to invest yeah like that’s my biggest thing is hey go learn how to invest um learn how to trade options learn like real estate investing just learn the numbers and if you they know that and the biggest thing i teach them is how money works right which is not taught in school which is not taught in school like i’m still flabbergasted when i go when i i mean i used to go out and speak um oh that’s coming back but um when i used to go out and speak i’m like well you guys understand how money works and how banks make their money and everyone’s just like and i’m like how do you not know this like yeah well i i learned that in economics when i took it to school so there’s few there’s few programs at school that really do teach you life useful things that are going to help you in the real world but i would say a business economics degrees help yeah yeah all right we’re not to get tangent but we digress we always do but i mean that’s why people come here is that why people comment down below is that why you come here or is it just for my pretty face or hey if it’s like the last video i got tons of comments about my singing oh yeah i heard that that was good yeah i’m not going to sing for you now um so they do talk about obviously that um and this is this is the tail always is the two biggest markets really affect the the pricing right um which is being toronto and vancouver they skew the national average by so i think it’s 660 000 if toronto and vancouver were taken out it’s like 120 or 130 000 difference oh yeah so you’re talking about what 440 430 thousand dollars uh for the national average but you can see like i’m just pulling up the chart here where the average price of properties in vancouver and like it’s it jumped that that that was the 10 and now that’s come back down so i don’t know the markets that i work in or where i’m investing they seem either flat or or slightly up right even since like april yeah not as volatile as these these major markets what do you make of that why do you think it’s so volatile it’s a great question um i don’t have a very good answer for that i don’t have a good answer for that either other than the fact that maybe that’s some of the push of trying to get into like we saw this before the last stress test okay um to get in early and then that levels off and then and then it dove down after and then basically it went and reverted to the mean and over time okay so that makes sense so people were anticipating stress tests coming in they bought a whole bunch of properties now that that goes away i mean so what i know that in january february there’s always a shortage of inventory since i’ve been a realtor for 12 years there’s always been a shortage of inventory and then march comes along and everyone lists their property and you know they they sell whatever they do right they buy and sell their properties in march and then you know april may there’s you know there’s residual but it’s not as much as march and then you know people are so done by june july august that again they go out and so supply it goes down again and you know less people look and we’re seeing that like supply is is way down but i mean worse like i had four or five buyers right now that have been out bid i don’t know four or five times already right so average home buyer is there anything to conclude from that or any wisdom that you can take from that and actually use to be profitable so you want to be buying in june july and you want to be selling in the other months selling another month but you don’t really want to be selling in december per se actually december’s not a bad time not not as good as say march though right i think well february march this year were some of the better years but typically i see in like january february march or so january february is again all the buyers are there but there’s not as many sellers so typical years it might be half a percent difference yeah i mean so if you can do that if you can buy it in these off like in the summer time you’re gonna like if you had bought again like this month or last month yeah you might uh so in may and june we were buying things and we were getting conditions on properties we were negotiating um deals we like there weren’t as many bidding awards there were still some but you saw two to four offers we’re seeing 10 to 16 to 20 offers again like in starter homes in hampton right okay so yeah you know better than i then so yeah august is picking up again yeah because in my experience it was always yeah like you said july was a little slower august was the slow month everybody was on vacation in august which that’s why i’m surprised to hear that it’s it’s picking up so much i think it picked i think so but the problem is the inventory yeah inventory again so i mean after september 1st are we gonna after labor day are we going to see inventory pick up i mean i certainly hope so um just from my sales business yeah yeah i don’t know right like it’s one of those things where it’s like has did we have that rush through the spring market and we started seeing this in june yeah end of may june where the you know some of the buyers were getting a lot of some fatigue and that type of thing right yeah so mark i was just noticing um a trend i was watching a review of the different cities in canada and what was happening and we thought prices last year were high and you know consistently in some of the major cities were 20 30 percent above last year’s average sale price and just looking at the the uh all of canada year-over-year change from july 2020 uh to 2021 um yeah 18.1 percent across the country well no that’s 18.1 in toronto and then 15.6 so it’s funny though like i just had greater vancouver up here and like they’re only 13 but and i would say that makes a lot of sense because there was that huge exodus from from the major cities like a lot of people wanted to get more space especially with the lockdowns happening so that that made a little bit of sense at least well that’s why i’m a little surprised with toronto being up the 18 right now right i think so we’re starting to see people come back into condos move back with opening and stuff like that um i mean that’s really driving some of some of the growth too right um i wonder if when it locks down again if we’ll actually see that come down the chair and just for myself personally this is this is i i want to look because i’m buying stuff out there edmonton only had a 7.2 change yeah it’s been a slower market i i really like what uh what albert has been doing in general in calgary i think has now returned to all-time highs in uh in average value well they’re up 11 year-over-year right so i mean alberta again bringing down the average yeah still bringing down the average even though they’re at all-time highs which is why i think it’s such an opportunity compared to other canadian markets yeah winter bank i mean it’s august and they’re still in winter there right so yeah they’re two weeks of summer yeah yeah they had it the first two weeks of august yeah yeah so 12 yeah i mean not as astronomical i think i think some of the other lower markets though you will still see that that 20 30 percent if you can you know micro niche down into the smaller areas you want a micro niche town let’s like windsor what’s winds are doing well look at this have a look at that yeah i mean pancreatic there you my point the rural areas further away from the major centers uh but i think they’ve caught us too yeah like that’s that’s wow let’s let’s check out another cottage market because we were looking at them before back in in the spring and they were up you know 40 something oh there’s 41 percent and core at the lakes there you go right and i that that’s my analogy of water going to the lowest spot when they’re you know there’s all this pent up demand people can’t afford in the cities they’re like okay well we can travel we can work remote well a lot of that is um we can’t we can’t travel yeah and we wanna we want cottage properties which i’ve seen yeah anecdotally up in the saabel beach area just things have gone insane up there uh properties have gone you know from low 300s to you know 500 600 in you know year and a half yeah and i’m just flipping through these so like oakville 24 uh oh what’s uh what’s windsor doing let’s check out windsor good old 30. 30 29 right so this is still on that trend but here’s the thing that’s come down though yeah they were like 35. they were like 35 36 keeping in mind that is a month to month uh month of last year to month of this year that’s right yeah so it’s year over year average yeah let’s see what uh the montreal is doing of the world okay 23 yeah like i mean like these are all good numbers i mean i can’t 55 so there’s gonna be a reversion to the mean there at some point i i would unless it was yeah all things all things held equal yes yeah it’s the other factors that we can’t necessarily factor political decisions new economic changes there’s there’s so many factors which is why anyone asks for a prediction we can never give one yeah we can do our best but well i mean i predict that in the outlying ontario markets that we’re going to see a slight problem month over month in person yeah i you know and we’ve been saying this all along well you expected rural markets to go up and they they continually have not to two our horns here uh but we’ve done well it seems like toronto is trying is catching up though and some of the more the cities are catching up now that we’re open right yeah yeah it makes sense and hopefully it stays open um but if it doesn’t i think that that we’re going to see another kind of dip back down towards people wanting to leave i don’t think we’re going to close i hope you’re right i really hope i’m right uh greater moncton again 40 percent check out good old st john’s again california what’s insane right now by the way well i mean it was i mean you say that but it’s not as insane as uh just for lack of inventory they’ve just had this huge inventory problem well i mean saying that so i was talking to somebody yesterday somebody i mean they just bought a duplex in dartmouth for 150 000 now from what i know i’ve never actually been there but anecdotally somebody’s told me that dartmouth is not the best area okay so i don’t think they bought in the best area but they’re going to go out there and live there because they bought it 150 000 cash they rent out a half they you know they make some money yeah it’s all relative right like no matter what if i’m coming from a higher price market going to lower price it’s it’s going to seem appealing even if that market’s up 40 i’m still going to say wow my dollar goes further here and i think we’ve seen that across the board in canada people making moves a friend of mine is actually just making the move out to calgary he’s just he’s wanted to buy a house start a family and they figured there was a better opportunity there they’re moving yeah all right mark so what do you think’s going to cure this problem is anything going to cure this problem or are we just going to have to live with prices going up 5 10 a year every year i mean i think prices are going to go up every year that much i don’t i think 10 is a little aggressive um but that wouldn’t be anything new in the last decade no but i think historical averages run to the 5 and i think we’re going to refer to the mean um and i i think there’s going to be a housing shortage in places that you know don’t that don’t put limitations on growth put limitations on development until there’s an accord between all levels of government and support to you know say municipalities to hey we’re gonna pay some like some help we’re gonna help you put some infrastructure in place so you’re not charging maybe these huge development fees or you know we’re going to help you streamline the the process of getting the builds in um and we’ll give you some more money for that i don’t know if money throwing money at it’s the answer most times yet you know there has to be some give and take uh but i again just on like various simple issues there’s no accord between municipal provincial and federal government so this is a bigger issue so is that ever going to come to effect and i think like you’re seeing this out in alberta where you see a seven percent year-over-year increase in say edmonton but it’s a lot more free out there right like it takes a lot less time to get development permits you know they the density they are going denser they don’t have the land use restrictions so i mean that’s one of the returns one of my deterrents for actually investing out there was this um but obviously i went ahead and done it anyway so i i’m still looking in ontario even though the prices are ridiculous because i think there’s those issues in place and i don’t think they’re going to get fixed easily so i still want to buy more stuff in ontario because i think it’s going to do super well because those issues aren’t going anywhere those issues aren’t going anywhere so yeah at the end of the day say it’s become because i’m a realtor or real estate investor that i’m telling you to buy real estate sure or or you could just look at it and say hey well this guy looks at the facts yeah and makes business decision based on that not airy fairy stuff so i don’t know yeah absolutely well you’re in this business because you believe in it right no no one can really effectively sell things they don’t believe in right so real estate that’s a great it’s a great niche for you to be in i often contemplate to get my license as well just because yeah obviously where else can you build wealth like this yeah and it’s not even because of a realtor i i think about this more because i’m a real estate investor yeah um and this is why i do all this research is because i’m a real estate investor and you want to know for yourself right and a little bit of geek this way but yeah yeah absolutely and i i’m with you on the on the issues in ontario i don’t think they’re going anywhere i think that as cities get more and more developed they just add more and more red tape and we’re going to see that at west too but if you get those unincorporated i mean i hope so obviously i hope when i get my 200 units out there that then all this red tape comes in nobody can build anymore that’d be beautiful i don’t think it’s going to happen though awesome all right thanks everyone for joining us uh comment down below if you got something you you would like andrew and i to talk about uh leave it down below we’ll get to it and we’ll comment we’ll we’re pretty good at responding to most of the uh the questions and that down there so thanks everyone see you next time [Music] you
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The HOT Truth About The Canadian Housing Market

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