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loudifu t1_j5ivutc wrote

Reply to comment by ameldrum902 in The dichotomy of FT by Johs92

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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