Half of Canadians on the brink of financial collapse

[CdnFox]

https://www.victorianow.com/watercooler/news/news/Real_Estate/Half_of_Canadians_on_the_brink_of_financial_collapse/

62% are struggling to make ends meet.

62% are spending way too much on housing.

51% would miss a mortgage payment (or rent) within three months if they lost their job.

Many are living paycheque-to-paycheque.

The online mortgage search and comparison site www.ratefilter.ca did a survey that reveals 62% of Canadians are spending more than 30% of their pre-tax income on housing.

The number breaks down to Canadians spending an average of 37% of their pre-tax income on housing.

So, it's students, younger workers, young couples and young families that are feeling the crunch the most.

 

[CdnFox]

And it's these younger kids and families who are flocking to the CPC having just realized what voting liberal or ndp has gotten them.

Hopefully they'll remember for the rest of their lives.

[eyeball]

It's time to make mortgage interest a deductible expense. I'd even make rent a deductible expense.

Landlords get to claim the expense of being a landlord as a deduction so renters should have the same opportunity.

[August1991]

3 hours ago, CdnFox said:

....

Many are living paycheque-to-paycheque.

.....

So, it's students, younger workers, young couples and young families that are feeling the crunch the most.

 

Older established Canadians are rich.

It is immigrants and younger Canadians who are poor.

=====

I have no problem with that. We should reward people who create a civilised society.

Land values in Toronto and Vancouver are high because of the efforts of past Canadians.

[August1991]

10 minutes ago, eyeball said:

It's time to make mortgage interest a deductible expense.

...

Absolutely not.

Clark in 1979 started that idea.

Trump correctly fixed SALT.

====

In Canada, unlike the US, mortgage interest is NOT deductible.

And in Canada, unlike the US, provincial/municipal  taxes are NOT deductible.

(Until Trump changed this and made US federal tax law like Canada... )

Edited December 18, 2023 by August1991

[CdnFox]

6 minutes ago, eyeball said:

It's time to make mortgage interest a deductible expense. I'd even make rent a deductible expense.

 

For your primary residence you mean. rather than investment ones.

They do that in the states and this is one of those rare cases where i would tend to agree with you. There's a number of good reasons for that. Just as we make capital gains on primary residences non taxable. A little tweaking of those laws would be a significant benefit.

Quote

Landlords get to claim the expense of being a landlord as a deduction so renters should have the same opportunity.

Sure - and it reduces barriers to home ownership disproportion ally for the lower and middle income people which is good and it adjusts with your income naturally

Having said that - back to the inevitable truth, it would do nothing until we start building enough homes - it would allow people to afford to pay more, and if there's not enough homes that just causes the price to shoot up as competition forces people to pay whatever the maximum they possibly can is.  NOTHING we can do makes a difference till we crack that nut.

[eyeball]

4 minutes ago, August1991 said:

We should reward people who create a civilised society.

And beware of people that society leaves behind.

Those who forget history are doomed to repeat it. You've noted the pattern of wars that dot the not so distant past yourself on many occasions.

[CdnFox]

3 minutes ago, August1991 said:

Absolutely not.

Clark in 1979 started that idea.

Trump correctly fixed SALT.

====

In Canada, unlike the US, mortgage interest is NOT deductible.

And in Canada, unlike the US, provincial/municipal  taxes are NOT deductible.

(Until Trump changed this and made US federal tax law like Canada... )

Ahhh no.  No he didn't eliminate it.

"The law limited the application of the mortgage interest deduction for married couples filing jointly to $750,000 worth of debt, down from $1,000,000 under the old law, but up from $500,000 under the House bill. Mortgages that are taken out before Dec. 15, 2017, are still subject to the current cap. The change expires after 2025."

So - you can still deduct the interest on the first 750 thousand US.  which in the states is the entire mortgage for most people given how much lower their houses are.  So if your mortgage total is 1.5 million - you'll still deduct half your interest.

 

 Paying assessed taxes is one thing, that's different, but writing the interest payments off on your taxes is reasonable and prudent.  I think you're confusing the two.  A city doesn't charge income tax. Writing off your interest on your income taxes would not affect the assessed taxes you pay the city.

[Aristides]

15 minutes ago, August1991 said:

Absolutely not.

Clark in 1979 started that idea.

Trump correctly fixed SALT.

====

In Canada, unlike the US, mortgage interest is NOT deductible.

And in Canada, unlike the US, provincial/municipal  taxes are NOT deductible.

(Until Trump changed this and made US federal tax law like Canada... )

Yes but Americans have to pay capital gains on their principal residences when they sell unless they buy another property of equal value or more.

[CdnFox]

12 minutes ago, Aristides said:

Yes but Americans have to pay capital gains on their principal residences when they sell unless they buy another property of equal value or more.

Which makes more sense than how we do it.  I think everyone knows i'm generally speaking against taxes altogether wherever avoidable but it does make sense that you would NOT pay taxes on the interest you have to pay to have a home to live in, and that you DO pay taxes if you sell that home at a substantial profit other than the amount you reinvest in another principle home.

Unfortunately that does rob the gov't of a great deal of income during inflationary times. Inflation goes up, interest rates go up, the deduction on people's taxes goes up, gov't revenue goes down.

When the gov't says that homes shouldn't be about profit and investment - they mean for anyone other than them

[eyeball]

5 minutes ago, CdnFox said:

this is one of those rare cases where i would tend to agree with you

It's weird how you can do that without being an arrogant pecker about it. It's a little creepy actually.

[CdnFox]

5 minutes ago, eyeball said:

It's weird how you can do that without being an arrogant pecker about it. It's a little creepy actually.

It was one of the rare cases where you weren't saying something stupid.  

(better?    )

[August1991]

17 minutes ago, Aristides said:

Yes but Americans have to pay capital gains on their principal residences when they sell unless they buy another property of equal value or more.

Good point.

In Canada, we don't. This primary residence capital gain exemption has always bothered me.

I worked and made money. You bought a house and made money. What's the difference? 

====

Of course, as my English brother-in-law once said, in America - they live in trailers.

[CdnFox]

1 minute ago, August1991 said:

Good point.

In Canada, we don't. This primary residence capital gain exemption has always bothered me.

I worked and made money. You bought a house and made money. What's the difference?

I - the homeowner - made a capital investment and a commitment. You could have moved at any time, the homeowner takes a risk.   Look at what happened to home owners when interest rates skyrockeded after the first trudeau was in office and inflation went bonkers - or what's happening to home owners now. Under the second trudeau.  (hmmm.....  i may have just spotted a big part of our problem)

Nonetheless - the renter enjoyes all kinds of protections. Their rent increase is protected, they are granted rigths the homeowner doesn't have, they usually don't have to pay for their own repairs, etc etc etc.

So there's a big difference.  But if you disagree - become a homeowner and there, problem solved.  

[August1991]

1 minute ago, CdnFox said:

I - the homeowner - made a capital investment and a commitment. You could have moved at any time, the homeowner takes a risk.   Look at what happened to home owners when interest rates skyrockeded after the first trudeau was in office and inflation went bonkers - or what's happening to home owners now. Under the second trudeau.  (hmmm.....  i may have just spotted a big part of our problem)

Nonetheless - the renter enjoyes all kinds of protections. Their rent increase is protected, they are granted rigths the homeowner doesn't have, they usually don't have to pay for their own repairs, etc etc etc.

So there's a big difference.  But if you disagree - become a homeowner and there, problem solved.  

Strongly disagree.

I  - the renter - chose to pay you money every month.

====

Real estate is a difficult business. As Charlie Munger would say, Too many people know too much.

[CdnFox]

3 hours ago, August1991 said:

Strongly disagree.

I  - the renter - chose to pay you money every month.

So what? That didn't change a single thing i pointed out.  Can't you even make a simple argument to defend your position?  I disagree! Because SOMETHING!!!!!  You're starting to sound like myata. Because we can! What??  LOL

[Michael Hardner]

I'm much happier reading the posts of August1991 and Myata because they are about big ideas and they foment discussion.

They don't just point fingers at a fictional archetype and scoff.

[QuebecOverCanada]

12 hours ago, CdnFox said:

Nonetheless - the renter enjoyes all kinds of protections. Their rent increase is protected, they are granted rigths the homeowner doesn't have, they usually don't have to pay for their own repairs, etc etc etc.

The renters do not own the home, therefore, it is not their "own repairs". It's the homeowner's repairs.

And thank God they have to do the repairs. Rents are incredibly high. If the unit/home isn't profitable anymore, then the homeowner has to accept the risk for its investment and come to the realization it has to be sold. There's no guaranteed investment in the world.

[taxesanddeath]

16 hours ago, August1991 said:

Older established Canadians are rich.

It is immigrants and younger Canadians who are poor.

=====

I have no problem with that. We should reward people who create a civilised society.

Land values in Toronto and Vancouver are high because of the efforts of past Canadians.

my friend, you are the mayor of the wrongville.  I know the housing market is almost flat-line when there is little or no immigrant. The whole situation is because JT's liberal is a one-trick pony. They only know fueling the economy with immigrants (I am not anti-immigrant, I was one). The immigrants coming in are not war zone refugees, at least most of them are not. They are at least the middle class. They come in and buy the house with their saving. The houses in Toronto and Vancouver are like the girls living along the Alaska-Canada Highway inner city in WWII, which local younger Canadian boys hard to date. In addition, just look at the new houses which even in a small lot have a very middle-class feel, with no borderline cases like in the 70s or 80s.
Now,  with the addition of carbon taxes, all Canadians are paying head taxes without knowing it. What can go wrong?

[CdnFox]

3 hours ago, QuebecOverCanada said:

The renters do not own the home, therefore, it is not their "own repairs". It's the homeowner's repairs.

 

What a trivial and banal comment.

Quote

And thank God they have to do the repairs. Rents are incredibly high. If the unit/home isn't profitable anymore, then the homeowner has to accept the risk for its investment and come to the realization it has to be sold. There's no guaranteed investment in the world.

Which is why they deserve to be treated differently than renters  

The funny thing  is most people who take the stance that you do.... "Owners have to suck it up if things go bad for them"...  are also the first to scream that having a home is  a right and renters should never be kicked out or have any risk at all.

So there you go.

[QuebecOverCanada]

6 hours ago, CdnFox said:

What a trivial and banal comment.

I know, I had to tell to you that the owners had actually ownership of the property and had to pay its maintenance. It's trivial and banal but obviously had to be told.

6 hours ago, CdnFox said:

Owners have to suck it up if things go bad for them

Yes. Every investments have their risks. I agree 100% with that. You can't invest and pay nothing in maintenance or just expect everything to be favorable to you just because you invested in something. Risks exist.

[Nationalist]

The risk of owning rental property is huge. All mortgages have gone up and depending on the amount of the mortgage, it's getting harder to just break even...even with the rent increases.

If we have a housing shortage...why not incentivize rentals?

[CdnFox]

29 minutes ago, QuebecOverCanada said:

I know, I had to tell to you that the owners had actually ownership of the property and had to pay its maintenance. It's trivial and banal but obviously had to be told.

Wow. I haven't seen anyone work that hard for a terrible joke since they took andrew dice clay off the air   That was pretty sad kid. Honestly i doubt anyone expected much from you.

BTW -if you didn't know what banal meant you could have just looked it up.

Quote

Yes. Every investments have their risks. I agree 100% with that. You can't invest and pay nothing in maintenance or just expect everything to be favorable to you just because you invested in something. Risks exist.

Nobody said differently. You appear to have started arguing with you and managed to corner yourself. Well done .

The issue was why they would be treated different than renters.  And there you go.

[CdnFox]

6 minutes ago, Nationalist said:

The risk of owning rental property is huge. All mortgages have gone up and depending on the amount of the mortgage, it's getting harder to just break even...even with the rent increases.

If we have a housing shortage...why not incentivize rentals?

Because we have a housing shortage.  We don't just have a 'house for sale' shortage, but an actual housing shortage.

Basically that means there are not enough homes to go around. So if fewer people buy homes, that means there are more people competing for the Rental units that are already in short supply. That drives prices through the roof for renters.

And unfortunately if rental prices Skyrocket then it makes it more attractive for investors to buy up homes to rent out which in turn means fewer homes for people to purchase and higher purchase prices.

We are in a bit of a death spiral. The more prices go up the fewer people can buy. The fewer people that buy the more expensive rent gets. The more expensive rent gets the more Investors will jack up the prices by buying homes. And the cycle continues.

The only way to beat this is build a lot more houses

Edited December 19, 2023 by CdnFox

[Nationalist]

6 minutes ago, CdnFox said:

Because we have a housing shortage.  We don't just have a 'house for sale' shortage, but an actual housing shortage.

Basically that means there are not enough homes to go around. So if fewer people buy homes, that means there are more people competing for the Rental units that are already in short supply. That drives prices through the roof for renters.

And unfortunately if rental prices Skyrocket then it makes it more attractive for investors to buy up homes to rent out which in turn means fewer homes for people to purchase and higher purchase prices.

We are in a bit of a death spiral. The more prices go up the fewer people can buy. The fewer people that buy the more expensive rent gets. The more expensive rent gets the more Investors will jack up the prices by buying homes. And the cycle continues.

The only way to beat this is build a lot more houses

Ya...that's rational.

Well...even once Polievre is in power, it'll take 2 years to even effect this problem.