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h1g440rs3 t1_j5dgq9u wrote

Reply to comment by DisconnectedDays in The dichotomy of FT by Johs92

“Overpaid” but monthly mortgage payments are still very affordable.

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DisconnectedDays t1_j5dgvu1 wrote

Not without a job and if they’re forced to sell they’ll most likely not have any equity.

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dismayhurta t1_j5dmrvt wrote

This is what corporations want...desperate people who'll sell cheap and take shit jobs.

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JiggyJerome t1_j5e1304 wrote

Capitulation. That’s the sophisticated word that banks and financial institutions use when retail investors give up and sell off their equities in order to pay for essential needs.

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VallenValiant t1_j5emk82 wrote

But not shit-paying jobs. Inflation means it is a waste of time working for minimum wage. You would only die tired. So it is either getting better wage or roll the dice and start a business.

There are some shitty jobs that pay well, and that is the way it should be. But shit-pay jobs will die out because people can't afford to work in those jobs.

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[deleted] t1_j5exp8i wrote

[deleted]

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Reggie_001 t1_j5ga732 wrote

The problem is that when too many people end up having to do that there is a collective energy that builds. To put it into perspective, things are exponentially worse than when the American revolution began, we are getting close to how bad it was when the French revolution began..

It's fine when the born-poor are forced to do it, but once even more middle class people are forced to it there will be violence.

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DiriboNuclearAcid t1_j5gma6n wrote

Ya people tend to forget the reason the American Revolution started is because people were mad about not having enough money. That freedom shit is just propaganda at best, delusional idealism at worst.

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__Sky_Daddy__ t1_j5exv0l wrote

This, to me, is exactly what is happening. Going to be brutal for Corporations operating with slave labor.

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midwestck t1_j5f5igf wrote

Nah they’ll just rely on expanded welfare paid for by middle-class income taxes

See: Walmart’s labor model

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__Sky_Daddy__ t1_j5f9hdc wrote

Nope. That doesn’t work at scale

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midwestck t1_j5fobn3 wrote

Yeah $6.2bn to Walmart workers alone is definitely not already to scale

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patriots317 t1_j5ezm84 wrote

Not just corporations…. Really everyone. With people as comfortable as they have been with an abundance of jobs, and employers desperate to hire, it has contributed greatly to the rampant inflation we’ve seen.

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ameldrum902 t1_j5e8plj wrote

In Canada they are allowing people to make interest only payments and defer the principal. This is not a good look.

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Lionel_Hutz_Lawfirm t1_j5ep6p3 wrote

Holy fuck UNLIMITED ROI! Smartest invention since sliced bread.

Mortgage holders will hate this one simple trick!

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Outis7379 t1_j5ffnkd wrote

Ever wonder why any idiot gets a credit card in this country?

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Outis7379 t1_j5ffisk wrote

Ah yes, let future me/government/whoever solve the problem.

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ronincelwarrior t1_j5gmd4n wrote

Interest rates aren’t locked in in Canada, though.

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ameldrum902 t1_j5gnfmq wrote

Mortgages come in fixed and variable. Banks have been calling the variable holders and offering to go fixed mid-term on their mortgage lately in an attempt to prevent defaults. Those that are too deep are being offered to just pay the interest portion and defer the principal portion back into sum owed. The banks know people over leveraged themselves on property that has an over inflated price.

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dvo3000 t1_j5hguwn wrote

Where did you hear this?

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ameldrum902 t1_j5ht0w8 wrote

I know 3 people, two with cibc and one with bmo, who got called to go fixed 5yr to drop their variable 5yr. One person I know took it because they had 3 years left on the floating variable mortgage they were currently in.

And the deferred principle payments, that was in the news for a bit a couple months back.

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dvo3000 t1_j5huh40 wrote

That’s interesting, and could mean different things. Thanks

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ameldrum902 t1_j5huvs5 wrote

Canadian banks hold too much consumer debt. Defaults would sink them. The numbers are in on this. I believe Scotiabank and TD were in the worst spot at the moment. I just hope we, the tax payers, aren't going to be on the hook for a 2008 style bail out.

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loudifu t1_j5ivutc wrote

Had the Canadian RE ever come back down to earth? I don't follow the Canadian RE market, but I'm under the impression that the RE market in the metro areas like the greater Toronto/Vancouver went to the moon, and pretty much stayed there until the pandemic hit. But as soon as the coast was clear, it rebounded with full vengence surpassing pre-pandemic levels, just like the rest of the world. Sure, sales have cooled off substantially now, but prices remain elevated if the Canadian market is anything like its southern neighbor. I wonder how many actually overpaid and were stuck with high interest rates??

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ameldrum902 t1_j5ix3y1 wrote

I'm in Vancouver. There's a population here that bought at the peak with 2.5% interest rates. When it comes time to refinance it will be painful or you will just be paying more in the long run. And if market value drops below your trigger, you will need to pony up the difference upon refinancing. Housing payments already account for 50%+ of people's household income. People are over leveraged on extremely heavy debt loads also. You add up all these factors and I'd say there might be a storm brewing.

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h1g440rs3 t1_j5djrj0 wrote

I refuse to believe they can’t make ends meet in some way. They made a high salary before, they’ll be able to get it again.

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Limonlesscello t1_j5e0929 wrote

Yea, skills don't disappear overnight lol. From what I've gathered, laid off individuals were able to garner higher salaries from smaller firms coming from the Big names.

This ain't the same as being laid off from Starbucks or Mcdonalds and having to work at Wendy's like some of you degenerates. XD

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National_Smoke4580 t1_j5egt3c wrote

Not if there are millions of other laid off “smart” people.

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Minds_Desire t1_j5ep9ps wrote

There won't be millions in the tech sector. Those skills are highly desirable at basically all levels of the economy.

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National_Smoke4580 t1_j5epgn3 wrote

If your ego allows you to work at Wendy’s with your fancy tech degree.

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Sea_Mathematician_84 t1_j5g3kgb wrote

There aren’t millions being laid off in tech. Big names laying off 10k but with the nuance being they hired 30-40k last year.

There’s about 12M tech workers in the US broadly speaking (and I mean BROADLY, as most estimates say 5-7M. **12M is all employees, including clerical corpo etc. ). If there were millions laid off we’d be talking about a catastrophic impact. Most of these people will be swept up by smaller firms and especially cybersecurity firms which pay just as well and have been taking off in the last 5 years like crazy thanks to the GDPR and other PII laws.

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ronincelwarrior t1_j5gmxel wrote

There’s also things like permanently open jobs in government for lower salaries because they need people but can’t compete with Google’s salary range. That said, demand for people who can code is basically infinite, the top tech firms laying people off are mostly cutting expensive management, junior devs, and non technical people.

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DiriboNuclearAcid t1_j5gn7i9 wrote

You can't pay a mortgage working minimum wage when you bought the house with your salary in mind. Some will say that's their fault for overextending but if it's happening across the country that's a crisis, not an individual problem.

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h1g440rs3 t1_j5h3phi wrote

Those that lost their jobs won’t work for minimum wage

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DiriboNuclearAcid t1_j5hp3cs wrote

Based off no evidence, just my personal bias. I think most people being laid off won't find another high paying job because their whole sector is laying people off. The ones who get a new high paying job will be a minority, everyone else will be taking a substantial pay cut.

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h1g440rs3 t1_j5hrhqk wrote

Lol but to minimum wage jobs?? That’s accepting nearly a 60% pay cut. That’s not likely at all.

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Hacking_the_Gibson t1_j5djmdp wrote

This is what I have been telling everyone.

Two years ago it was “the loans are so good this time,” yeah well if the borrowers were in tech or finance, look out.

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NoMuff222Tuff t1_j5eb4e0 wrote

Can’t afford a House with a $700 Corolla Payment and no job 🤣

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lockll t1_j5fd69z wrote

A lot of places are hiring and are desperate for people but k

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lostmypeachshorting t1_j5enoq8 wrote

1600 is our monthly mortgage. That is less than we paid to rent a 2br apartment. That is 800 per person. Even with a minimum wage job I can afford it. Low rates really were a blessing

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ThetaForLife t1_j5f6nvf wrote

How much is your area’s minimum wage? Lots of places still pay $7.25-15 or $2900-$4800/month if both work full time. After tax it is likely be $2300-3800. After $1600 mortgage it is $700-$2200. Hope 2 adults can pay for: food, electricity, phone, internet, gas, clothing...etc with $700-2200.

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DiriboNuclearAcid t1_j5gr9y1 wrote

Another thing that could be an issue is that those middle class tech workers getting laid off probably have a mortgage payment much higher than $1600 a month. Not to mention those people have families which is even more expensive than just 2 adults. If enough people default then we have 2008 part 2.

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ThetaForLife t1_j5f5zp8 wrote

Good for people who will afford to pay. For people who cant and have to sell, They need extra $50k-100k to “sell” the house.

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StankFist1397 t1_j5fxb5t wrote

just cuz its affordable doesn't mean you should overpay

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h1g440rs3 t1_j5h3zup wrote

Lmao people have been waiting their entire lives for a chance at an affordable house. And those who waited will wait for their entire lives if they want to “underpay” for a home.

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