In the 1970’s, land was cheap. One could buy a home in Toronto for 25 thousand or a mansion for 50 thousand. When Prime Minister Trudeau got into power, he opened the doors, allowing all kinds of immigrants into Canada. This is not a bad thing. Immigration increases diversity and makes the joint less boring. Certain members of this ethnic group, not mentioning any names, gravitated to certain areas. When they came, they saw cheap land and they bought it, selling it back to members in their homeland for a bigger value. In the 1980’s, such a move exploded the value of homes in Canada.
At present, in Toronto everywhere you go in the city, you will find a construction site, building a condo. If you drive into the city on the expressway, you will notice a wall of condos going up. It is that obvious. It is not just one, or two, going up, it is more then the entire amount of condos in the state of New York. They are expected to remain empty and house no one. One ponders the fact government officials are getting rich off of this arrangement. They must have nice offshore accounts for this one. If you travel by transit, there is a construction crane at every stop.
Canada’s population is 35 million strong, strongly concentrated in Toronto, Montreal, Calgary, and Vancouver. We do not have a land shortage. Everything is too spread out for that. The condos that are going up are investment property. The Canada mortgage and housing corporation (CMHC) was created as a guide book for the real estate market. In reality, it represents the real estate investors, not renters, home owner, or potential first time home buyers. The federal government is gutting it, no longer protecting real estate investors. Foreign investors should expect a good shock with popping sound in their investments in Canada.
You want more proof? It is no longer a shock to see those in their 20’s, 30’s, or even 40’s, living with their aged parents in Canada. This past week, 11 students were found living in a 3,000 foot square home, all paying $500 to $700 in rent to a home owner. Why? They were students who wanted to live near their college, or university. And this is a common thing. It must have been a slow news day. No money to buy a corrupt official. No one hires honest people anymore.
Don’t believe that one. Visualize this. Cash strapped university graduates with MBA’s team up with other university graduates from school. They borrow money, buy investment property in the burbs, and turn the home into a grow-up, all to pay down the mortgage. They repeat the process. Maybe someone finds out, but no one cares. It is all too common. If the police don’t find them then the fire department will. If first time home buyers are not involved in such a scam, Canadian Real Estate agents are. Take a look here.
Everyone knows someone, looking at the classified section, looking to buy a cheap home stateside. Forget the media business prognosticators, or business advisers in the financial services industry. They are payed well to keep everyone calm. “Now is the time to invest,” they will tell you if you call your broker up. All lies but someone has to be paid to do that. Quite recently, I interviewed Tatiana Mihowich, an area Psychic Reader and Healer. “I usually read unemployed professionals,” she told me recently, “who have had their name in the newspaper, had the big job, the big money. They are now unemployed, broke, have responsibilities, and don’t know where they will get their next dollar from. This is not an isolated thing, it is part of the collective of the new society.” If you missed the message, press the replay button.
Developers finance political campaigns. The media only reflect the opinions that come from real estate agents and the companies that they work for. They all say the real estate market is hot in Canada, not in a bubble which it has been since the 1980’s. If you did not get the memo, the real estate market in Canada is over inflated. I, like many others who live here, fully expect to see a Japanization of the Canadian housing market. What is that? Japanization was a real estate crash that happened in the 90’s in Japan, which led to home values in Japan to return to 1983 price levels. Ouch! The rich in Canada need to learn such a lesson. They have no sense of social responsibility, only greed, arrogance, and stupidity. They are not even the right caliber of individual to exercise such power that would decide the fate of nations, let alone the lives of their own citizens. They just look at the balance book. If it is not in their backyard, why should they care? That is their mentality, period.
No politician would discuss such an issue in the media. The developers would not allow it. Real Estate agents all want their commission checks. Everyone should be paid. Political campaigns should be financed. Real Estate investors from foreign countries should not have to learn a hard lesson in investing in Canada. Such an experience would cause those with money overseas to lose their shirts, causing massive unemployment and social unrest. Maybe people with money need to learn such a lesson. If you read this far, find and sign a no disclosure agreements, send it to someone, and believe that corporate media machine about there being a hot housing market in Canada.