Aside

2018.4.11

It’s incredibly dispiriting to know that despite my financial responsibility there is almost no chance that I’ll ever own property in the city I live in, and a possibility that at some point rent alone will force me out. I cannot imagine what life is like for those who have less privilege than I enjoy.

Link

First-time homebuyer? You could have less borrowing power under new mortgage rules

The CBC:

But Tal says the one place the rule changes will be felt is the Toronto condo market, where sale prices are below $1 million a property and deals often involve first-time buyers with down payments of less than 20 per cent.

“That’s exactly where the target is,” Tal said.

Shaun Hildebrand, senior vice-president of real estate market research firm Urban Nation, agrees with Tal.

“If there is a beneficiary to these policies, it will be the condo market, whether it’s on the for-sale side where buyers are forced into lower price points or on the rental side, as well, as fewer first-time buyers are getting into the marketplace,” Hildebrand said.

While I tend to agree that moving people towards a long-term rental market is important and not an inherently bad thing (in fact, that culture is prevalent in other housing markets), it does demand affordable rental properties. So: will the slowdown in the condo market actually reduce costs of condos due to competition, and lead to a lower rental rate for them on the basis that landlords will not have to recoup the same investment, or will rents remain where they are (and rise) so that wealthy landlords can extract further rents from their tenants?

Link

How do young people afford a house? They find roommates.

How do young people afford a house? They find roommates:

“When you look at the home market for first-time buyers, to get in can seem like an insurmountable task,” says Aaron Zifkin, Airbnb’s country director for Canada. “In a lot of our host community meet-ups, we’re seeing a lot of people who are really excited being able to bridge that pay point by earning a little extra income from a nanny suite.” Or, if no nanny suite exists, the pullout couch in the living room might do.

In Vancouver, for example, more than half of the money taken in by the 4,200 Airbnb hosts went to pay for necessities like the rent, mortgage or groceries, according to a company report released in July. With the typical host earning $6,500 each year, more than half of them said the extra cash was a reason they could afford to stay in their home. Seven per cent said the money helped them avoid foreclosure.

But don’t worry: there isn’t really a housing crisis in major metropolitan areas when people have to rent (parts of) their home in order to avoid forclosure. And the fact that roommates are a requirement for many 30-somethings to purchase 850ft condos in Toronto is entirely appropriate.