IPFC 04: Canada’s Housing Affordability Crisis

Subscribe to the Podcast at: Apple Podcasts, Google Podcast, Amazon Music, Spotify, Stitcher, CastBox, TuneIn, and PocketCasts

Trying to Understand Canada’s Housing Affordability Problem

Christine: Welcome to It’s Personal Finance Canada. I’m Christine Conway, and I’m Cameron, Conway, and this podcast is a very personal look, at personal finance in Canada. Hi, everyone, it’s Christine and welcome to It’s Personal Finance, Canada. Cam and I are here today and wanting to tackle the very multifaceted home and housing affordability situation that we find ourselves in here in Canada.

Cameron: Are we promising to fix the problems?

Christine: Oh, my goodness. I wish it were that easy. But I would like to say that you know I fell into the trap for a number of years of thinking. It’s one thing: If we fix this, one issue we’ll solve the whole problem. And, unfortunately, for me it seems to be quite a bit more complex than that.

Cameron: Well, if it was that simple, I’m sure someone in Ottawa or in Victoria would have figured it out by now, but.

Christine: We would hope so and as a disclaimer, we are not professionals in this area at all, we’re, not economists. We are just two people that have an interest in this subject, honestly for our own personal point of view as well.

Cameron: Our own personal point of view of plus this is also something that you see a lot in your practice in the office, because this is the kind of thing that most people hit up again. It’s do I invest, do I buy a house? Do I have enough money to do anything that I want and housing is such an enormous part of your personal finance and your budgeting. That when it goes insane like it is recently like with thirty percent increase year of year than a twenty percent increase the year before that, and twenty percent increase the year before that. What used to be, Oh yeah, I’m gonna, go by a house, is now, can I even afford to live in this province anymore?

What a Difference 5 Years Make

Christine: Well, that’s exactly it! You know five years ago, if you’re looking back 2016, 2017, it was a bit of a no brainer right. For half a million dollars you could buy kind of a starter home. You know it doesn’t have to be anything fancy, but you could have a bit of a yard have a little bit of a fixer upper but a place with enough space in a nice neighborhood to raise your family.

Cameron: I remember years ago to a still working at the post office. I would get so many real estate flyers, maybe the four or five six every single week, and I remember looking at them in my area, I’m thinking, wow, seven, eight hundred cave these houses. These are expensive, but now fast forward. Five, six years later, those seven hundred eight hundred thousand dollar homes are like 1.5 to 2 million dollars now and that’s putting it out of reach for so many Canadians.

Christine: So that brings us to a whole lot of problems. One of the most important impacts I think for our society is that we’ve got a whole younger generation that is looking at their future and realizing that it’s not going to be kind of what they felt like it would be when they were a little bit younger. So we all have that dream of maybe raising our kids in a nice house in a nice neighborhood and that single family home dream seems to be getting further and further out of reach for a lot of people, and not just you know, people that are struggling to make ends meet well paid professionals that are you maybe they’re, making six figures. Maybe they’ve got that career, but it’s still not enough.

Cameron: Yeah, its kind of sad that if you actually want to own a house in a lot of places in Canada these days, a six figure income really is the minimum wage.

Christine: It kind of feels that way, and on top of that, you need someone to be living there with you right. So that that puts everyone that single of perhaps more career oriented at a bit of a disadvantage just because it really does take to income these days to get into something other than maybe a starter apartment or town house depending on your region. So, let’s take a look at what I’ve kind of viewed as the major drivers of the housing problem, and I don’t think we’re going to get to all of them today, but we’ll do our best at kind of laying out what the key issues are and then in subsequent podcasts we can kind of continue this conversation.

The Bank of Mom and Dad

Cameron: So we can figure out on a scale of one to ted how bad things really are?

Christine: Well, like I said I think generations to come will have that vote for us, but we are in a situation right now where people are having to rely on support from families right from their families from their parents, from that older generation to even get that down payment together. Because as the housing price goes up, you know getting that twenty percent is so much more difficult.

Cameron: Well and that’s not even a guarantee like if you’ve listened the last couple weeks with ours, disability insurance or critical illness talk and all of that. Depending on things, go your parents inheritance could have been eaten up by other stuff. So it’s even then it’s a 50//50 chance of getting some money from the Bank of Mom and Dad. So I can go put a down payment on this one point five million dollar eight hundred square foot shack from the 1930’s.

Christine: Well, we don’t want to find ourselves in a world where the only way you can have a home and own a home is inheriting one right. I mean that kind of steals the Canadian dream it takes us out of the realm of being able to pull up our boots straps and do it for ourselves and into the, oh, if someone doesn’t give this to me, then maybe I won’t have it.

Cameron: It kind of feels like a long depressing marsh right back to feudalism.

The Role of the Bank of Canada

Christine: So, let’s, let’s do a bit of a pivot here and I’m going to start by talking about my one thing. So for years I was of the opinion that monetary policy and the Bank of Canada, so that his interest rates, were kind of the key piece that was fueling, the increase that we were seeing in housing prices and I’ll kind of explain my position there a little bit. When you’re qualifying for a mortgage, one of the key factors in determining how much you can afford and also what your payment will be is the interest rate. And, of course, over the last decades so not decade. It’s been a number of years now, where we’ve seen this great downward trend in the interest rate. And for a while, you thought, okay, great you’ve got more purchasing power, but unfortunately, what seems to have happened is people will go to their mortgage broker and they’ll get their pre-approval and because this market has been so competitive, they’re, basically having to spend everything that they qualify for. Whether or not that’s a good idea that’s another conversation.

Cameron: Well, they kind of have to get whatever they can because they’re competing with a whole bunch of the people, they’re competing with corporations. Like I heard a couple months ago to even Zillow down in the states had to lay off a whole bunch of staff, because he they’re automatic bots or buying up houses way over asking, they’re struggling, so you’re fighting with people from every single different direction. All of them have more capital. So if people are kind of forced to get every single, nickel and dime that can get out of a bank.

Christine: That’s right, but if the Bank of Canada controls the interest rate, so they set the overnight rate and what that is. It’s the interest rate that banks used to kind of trade to each other, to even things out at the end of the day. But it’s also the rate that they use kind of as a benchmark when each bank is kind of determining what they’re going to lend out to the general public. So a lower rate is essentially trying to stimulate growth and that’s why we’ve had interest rates so low for so long. So when you’re looking at the Bank of Canada, they have four core functions and the one that I want to kind of talk about a little bit today is monetary policy. And that is essentially directly tied to the interest rates and they kind of have a bit of a duel pronged mandate where they want to see stability in terms of jobs and the job market, but they’re essentially saying that they’re trying to preserve the value of money by keeping inflation low, stable and predictable. And you know if you read a little bit further through the information that they put out on their website, they’re trying to say that they want everything to be kind of secure for Canadians and they want cost of living to be manageable. And I’m paraphrasing a little bit here. But they have a target at this point in time. They do have a mandate that renews so it can change in the future. But right now the target for inflation is between one to three per cent, and it’s quite a bit higher than that.

Cameron: Oh Yeah. We’ve been kind of budding up against four, four and a half, five and it’s the same thing in both sides of the boarder. Americans to have been fighting with five percent inflation month or month since about August.

Christine: I believe I think it’s over six percent over there now and the Bank of Canada has kind of been like okay. Well, let’s not shock the market too much, although they have been starting to forecast that they will be raising the rates in 2022. and beyond.

Cameron: So Bank of Canada is kind of taken the frog in the pot mentality. Just do it slowly and we won’t notice? Or are they worried, that’s just going to blow up in their face if they don’t.

Christine: I feel like we’re in a situation where it’s kind of like whether you do or you don’t there’s, there’s negatives on both sides right. So, if you leave the interest rate, low people will continue to borrow so that will essentially add fuel to an already hot fire and how high can it go? Well, how much money can we borrow right collectively and it’s not just what you can borrow? It’s what can you lever if you’re already in a property and you’ve had all these great increases to your equity? But if you leave it and don’t do anything, then this inflation is going to start running out of control and then you’ve got a problem where it’s not just housing that becomes unaffordable, it’s everything.

The Problem of Inflation in the Housing Affordability Debate

Cameron: Is that kind of what happened in the States and parts of Canada back in the 60’s where energy prices, inflation started going out of control. And then you get to the 80’s and then you have ten fifteen twenty percent interest rates, which was kind of the backward swing to kind of combat all those other problems that were having before.

Christine: And in the 80’s we had something that got to be known as Stag-Flation, which was basically stagnant economic growth. So not a lot being produced of value in terms of our GDP. And inflation that’s been going absolutely crazy and I think it puts the Bank of Canada in a precarious position where they almost have to increase interest rates. Or at least that’s what we saw historically just to kind of say, okay pump the breaks here guys stop borrowing money. That’s why those two things go hand in hand. So in one point of view, productivity is slow right, so you want to stimulate that productivity, but when inflation is too high and everything else is gone out of control, then there’s no stability for day to day people just because, when things increase in value it’s so hard to see them go back. That other way right like when prices of food or other goods increase, we don’t often see them, adjust downward.

Cameron: Well, no because a lot of companies they just what’s the point? We’re charging this right now people are buying so just keep it at that rate. Lets keep it that high. Unless people fight and complain and go somewhere else, then it’s not a problem. But the problem is especially in Canada, is we’ve got so few companies and so little competition, there really is no ere else to go to half the time. When prices really do start to go up. Even with groceries, we got what three or four real options and if they all jack their prices at the same time, there’s not much you can do with that was that whole bread pricing, scam that was going on a few years ago were Loblaw’s and some of the others got caught. So there’s no incentive for the companies to really lower prices afterwards, because then they just boost their own income. They kind of fall into that same wage, verse productivity trap, we’ve kind of been into since the 80’s where productivity has skyrocket, wages have a kind of stayed stagnant. But amongst that stagnation of wages, the housing prices have gone up exponentially.

This is the Mortgage that Never Ends, It Just Goes on and On My Friends

Christine: And this is the conversation about inflation. It’s really all about the devaluation of a dollar, so your dollar today purchases less than it could previously, and what I think for me is concerning with the housing market is not only are we fighting. The high cost of goods were also in a position where interest rates are so low that if the Bank of Canada kind of does keep its promise and rise raises the interest rates we’re going to start seeing not immediately, but on the renewal of your term, your mortgage term, that pricing structure getting quite a bit higher. So if you’re in a mortgage today and all of a sudden, you know it’s a couple hundred bucks or more higher on your renewal, I mean you have a couple choices, one of the banks, nasty tricks which I don’t like, but you see it all the time. is they like to try and extend your amortization period. So, let’s say you’ve been in a mortgage for ten years, you’ve made a ton of progress, you’re starting to pay down your principle. It’s feeling good, and then they say. Oh, we got this great deal for you, but all you have to do is re-extend your period to twenty five years. But that means you’re back at the beginning. And we’ve seen this quite a lot with lower interest rates where people were trying to drop that payment even further. Trouble is now if you’ve got a longer amortization period, you’ll have less wiggle room. If you have to extend your mortgage in the future because of a legitimate interest rate increase.

Cameron: Well, then you’re paying exponentially more than what you actually paid for on the house, like even on a standard like twenty five year mortgage, you spend a million dollars on a house, you’re, probably spending one six hundred and seven total after interest. And if you keep  dragging this out for another five years, another ten years he could have spent two or more million on a million dollar house.

Christine: You’re, essentially paying expensive rent to the bank right. But think about it from the bank’s point of view, even though you on paper on your home, they have a right to it to a certain extent. Just in the sense that if you don’t make your payment there’s a repossession around the corner, so that stability that comes from owning a home. You know it’s kind of questionable and of course it’s in their best interest. If I’m a bank and the most important thing to me is being profitable, then of course I’m going to want to keep as many people locked in for as long of a period of time as possible. But the problem is that if we truly are now at the bottom of the rate cycle, and I mean the overnight rate, is so, so, so negligible right now that if they do start going up, your payments will increase right. And that’s something that people aren’t prepared for, maybe necessarily, but also that those dollars are going to be competing with the increased cost for everything else. With this inflation problem that we’re talking about.

Cameron: So when it comes to the banks, are you saying the only way you can actually win it just to go buy some shares in the bank?

Christine: Exactly get some distributions through dividends and things like that. A lot of them paid great, stable dividends. But yes, you want to be in the owner class and kind of not on the other side of it. So when we’re looking at interest rate history- and I mean I just pulled this quickly off of Realtor.ca There’s no shortage of calculators on online that will give this information to you.

Cameron: And a loan to go with it.

Christine: And a loan to go with it. So competitive out there. But when you’re, looking at the average five year, fixed rate mortgage, which is the most common type, it’s what most of us have and you’re looking at the period of 1980 and 1990 that average rate was 11.92 percent. And you know if you go from 1990 to 2000. It was 7.23 percent and even just a little bit further 2000 to 2010 it was 3.89 percent. So you can see how people have kind of gotten accustomed to things, getting cheaper and cheaper and maybe not prepared for what will happen when things get more expensive. I think, in my mind the greatest risk factors these people that have purchased in the last few years.

Cameron: Well. I think it’s more in the last two or three years since the real spike has happened.

The Impact of the Work From Home Movement

Christine: I was going to say with COVID we’ve completely changed the way we make decisions about where we live and work right. I mean that was never really part of the conversation before.

Cameron: Yeah, even a here in Metro, Vancouver with the whole work from home movement. Before there is a pretty clear difference in housing price, depending on which side of the river on. If you’re out in like Richmond Burnaby, Coquitlam it was a higher price. You cross over go to Surrey, Langley, Delta is much cheaper. But now this whole transition we’re finding that a place like Surrey is now on average, more expensive than Burnaby and Coquitlam and parts of Richmond, and that buffer zone or affordability places like Metro Vancouver. You see the same thing in Toronto with the GTA. Even I are like places like Sarnia, Ajax or other places that you don’t see that decrease in price anymore. Everything is essentially priced, pretty close to or as the same as the main core.

Christine: And that is giving people less choice right because it used to be the trade off of your commute to work versus location, and yet it does to a certain sense, feel like that’s gone out the window and we’ll see how things level out in the next few years see what kind of work models come out of this. You know if more people are working from home part time and they’ve chosen to live a bit further out than maybe they would have considered otherwise. Is that something that they feel will be sustainable if they have to go into the office three days a week? We’ll see you know that part is yet to be written, but I think now that we’re talking about variances and prices you’re talking about the GTA or even the lower mainland here in the Vancouver area. Let’s talk about the rest of Canada, because it’s not just a single note across the whole country, there’s such a wide variance and when you look at praising, so I love to go back to Winnipeg a for comparisons. right because I mean that’s where we’re originally from.

Cameron: Not to live there again?

Christine: Oh my goodness, it’s a whole new world right, it’s a whole different world out there. And but if you look at kind of the two, the two big areas, so the Toronto area, the GTA and the Greater Vancouver area as well, and then you kind of compare that to the prairies. Obviously, we’ve had big, big affordability, challenges here and out east as well, and much less so in the prairies. ReMax. Canada just put out a housing affordability report where they were looking at salaries, so salaries as a median per household across different geographic areas and what the housing costs so in Winnipeg you’re. Looking at a median household income of about $97,750 and housing prices on average, of course, of about three hundred and five thousand dollars. Where in Vancouver the median housing price is over a million now, but the median income is still about $97,620 twenty dollars. So actually slightly less than our Manitoban counterparts. So when you’re looking at quality of living that you can have, when your dollars are maybe redirected elsewhere as opposed to housing, you can have a stronger economy just because you’ve got people, consumers that have more money available to spend locally, as opposed to the problem that we may face here in the future, where the same amount of dollars are chasing fewer resources because more is going towards housing. So that’s part of the concern- and I mean it’s not just across the prairies if you look at Alberta, they’ve actually had decreases in their housing prices there. So I mean, I guess you can hand it to the Bank of Canada. It’s very much geographical, the problem.

Cameron: Well, that’s kind of what they’re saying they’re, even there was a report that came out last week, where the saying there isn’t a big national bubble to worry about they’re trying to say it’s just certain key areas like Greater Toronto area and the whole, well really now is the entire bit of southern Ontario, which is essentially price the same as Toronto. That stretches up all the weight of places like Thunder Bay of all places.

I Demand More Supply!

Christine: And that brings us to the conversation about supply and demand, and I don’t think you can talk about the housing affordability crisis without talking about that, and I think part of what the reason that housing in these areas or the Metros are so much more expensive, is because the demand just seems to be so much higher right. You’ve got immigration. You’ve got interprovincial migration that happens as well, so people moving from province to province to get somewhere else.

Cameron: Yes, we were part of the problem.

Christine: Yeah we’re definitely part of the problem, but you’ve got a large number of people chasing a limited supply in these in these areas, so I mean in BC here. we’ve had some things happen to kind of try and address this, and it’s going to be interesting in the years to come, to really evaluate the successfulness or not of these programs. And what I mean by that is, I mean in BC here, we’ve got the speculation and vacancy tax, which was essentially an effort to curb, or at least get some money out of people, not Canadian, so foreign investment that was using essentially Canadian real estate, as a piggy bank as a place to just stash some cash in the hopes that you would have this crazy appreciation that we actually did have over the last number of years. And then cash out, thank you very much have a nice day and also the Transparency Registry, which is another significant step forward. A part of the problem here is that it’s not just you and me, and your neighbor buying houses any more. It’s you me, your neighbor and a numbered company represented by who knows who that are also competing for that same property down the street.

Cameron: Yeah, there was a story a few months ago, out in Ontario, saying, they’re (this corp), going to pump like two billion dollars to go buy up single family homes. Or even just south of the Boricua, like ZIllow, that has essentially deployed their army of bots to go out and buy all these houses online. Now it’s bit them in the foot. Now they had to layoff a huge chunk of their staff because they over bought and over bid. This is what we’re competing with is not just people going to an open house and taking a flyer home with them. It’s people buying houses on mass, people with huge amounts of credit, people buying their third. Fourth, fifth, six house, you doing the same thing with corporations, it’s just a lot harder now to actually just, or just a regular family to go out and get a house without a bidding war or just over paying for it.

Christine: That’s exactly the problem, so you mention corporations and even every day people. You know they’ve seen these incredible increases in the price, and this is the very nature of any asset class bubble. Prices go up and up and up and people think they’ll, never ever come down and they want to jump on that gravy train. While it’s still going and I mean even today, I was reading the Financial Post and they had an article out. I posted it on my LinkedIn and my Facebook as well, so you can go back and take a look. But it was saying that half of the spending, so non consumption spending, was on housing and what they’re getting to was, if you kind of go through the article, was that people are taking money, investment income that would otherwise be going into productive assets, so non residential investments, like maybe buildings or infrastructure equipment or software, the business side of the economy. It’s just getting put into real estate right and- and this is the numbered company problem that we’re bumping up against where the Transparency Registry here in B C, is attempting to address this. Who are these individuals who is controlling this property? And the whole point of the Transparency Registry? Is that if you own over 25%, then your name goes on the list and they can kind of see the province. I mean, can kind of see all of your associations, so I control company number one, two, three four and five, and what’s in them?

Cameron: Well you just going back to that Financial Post article you’re talking about it, also adds to the entire problem of the stagnation of the economy and wages, everything else, because so much money is just being thrown into these properties and into these mortgages that it just can’t go out anywhere else. and that was the whole reason why even the states they had all this stimulus this money just to throw cash into the economy, get people moving and doing things. But more in parts of Canada, all that money, all the disposal income is just going into a mortgage. It’s not helping the overall economy, it’s not helping people in general. It’s just being squirreled away in someone’s basement to sit there for twenty thirty years.

Treating Canada’s Housing Supply Like a Foie Gras Duck

Christine: So the question is will prices just go up and up and up and up, and I think that’s a very regional question that we have to ask. And I think that part of that looks at the movement of people and where people want to live so part of that is. This is all part of the demand side of the problem, so part of that is immigration and like we were touching on interprovincial migration as well. But if you look at Canada’s immigration policy, so in 2021, even with everything going on in the world right now, we were on track to and I think we did bring in 400,000 people this year. And if you look at their projections for the next couple years, it’s like 411,000 in 2022 and 421,000 in 2023 So I mean that’s another 1.23 million people and presumably families down the road as well that are going to be looking for homes. And when you look at those numbers kind of without saying if this is good or bad you’re. Looking at where they’re going and you’re saying, okay. Well, if we look at the last census, so statistics, Canada in 2016, thirty six percent of those folks ended up in Toronto and twelve percent in Montreal, and thirteen percent cent came here to Vancouver. So you’ve got an ever growing population that needs a home because you know you can’t bring one with you kind of thing.

Cameron: It’s essentially an ever growing bidding pool for houses and whether it’s buying or renting. And the housing starts are just not keeping up like we’re probably about twenty years behind on housing starts and then you’re dealing with the whole and NIMBY aspect. Like even in our neighborhood we’ve had what one or two towers canceled because of locals complaining, every time they try and bring some any kind affordable housing it gets shot down by people. So you have this fight of there’s no land to build. The people don’t want the building and where all these people going to go? Even in downtown of Vancouver, they’ve, essentially run out of industrial space to rezone, and they’re being forced to push out into the single family areas to try and get some more density in. But every step of the way it’s just a huge fight and where else do you go?

Christine: Well, and this is the supply side issue right with an increase of population. There has to be densification, especially when people want to live in the same areas and that’s not just saying the same cities, but it’s also narrowing the down that further and saying they want to live close to transit public transit. They want to live close to major city, centers shopping malls, other parts of the infrastructure in our society, where people want to be right where the action is.

Cameron: Or even for us on a local level you look at Surrey like around 104 and King George, that’s exactly you’re, seeing. You’re, seeing dozens of towers going up. You got the hospital there. You’ve got SFU, you got the UBC expansion coming, hospital right there and you see that core just exploding, because they’re actually trying to build up that area. Take it from those single families or those four or five story- apartment complexes, they’re putting in thirty forty story towers, but a lot of areas they’re not as willing to go that route.

Not in My Backyard, or in My Podcast

Christine: So let’s talk about NIMBYism, so that’s the, not in my backyard mentality. That can really hinder the change of use that we need to see to house all these people. And it’s, I don’t want to, this is not a political discussion in any way. We’re not going to kind of show any colors or take any sides on this. But a lot of zoning takes place on a municipal levels. So that means the city that you live in makes a lot of the decisions about how land can be used. Is it going to be single family? Is it going to be multi family homes and some more established neighborhoods have the mentality that you know: We’ve had single family homes for ever. This is how we like to you know raise our kids. We’ve been here for generations will pass this home to our kids one day and they don’t want to see multi family homes or town houses or apartments in that area, and, like you had just mentioned, we’ve seen some of that in our city, as well and in the surrounding cities, also, where there’s a huge push back. And this is where it gets political, because the people making these decisions- the Mayor City Council, they are under a lot of pressure from their constituents, so the people that are throwing their votes their way or not as to whether or not they’re going to allow this and how they’re going to vote now. There was a proposal from the city of Vancouver that I don’t believe it’s gone to counsel. Yet I think it’s in January of 2022 where to deal with their need for dentification and as you’d mention lack of land. The proposal, and this is going to be a little bit crude and probably not as exact as it needs to be, but they were proposing using a normal residential lot and giving the owner of the lot discretion to have it rezoned into six  sub lots that could be individually owned and to essentially try and densify that space. And I mean we’ve talked before about row homes as a solution. Non strata, so we’re not talking about a situation like we have here commonly now where, if you want shared home, you have to be a part of a community, a strata community.

Cameron: Well, this isn’t an out their idea, even the community. I grew up in to help with affordability issues they built several streets of row, homes that were not strata even in Europe, it’s pretty common. So I can see why they’re trying to bring this in here. Just try and deal with some of these issues, especially in a place that’s getting so densely, packed in like Vancouver, even as you see places like Toronto or Montreal.

Christine: But the big. The big question is: will these communities will these municipalities actually accept? These types of proposals- and I think it has to go beyond a municipal level as well, because when you’re looking at building affordability, building, affordable housing comes with a big price tag right, so you do need funding and you do need support from other levels of government as well. So this is not just a municipal issue, it starts at the municipality, but it must be supported by the province and has a much larger. Conversation must be supported on a federal level with real hard dollars, and that’s not just okay, we’re going to put in you know a couple hundred homes. It’s nowhere near the need like if you’re looking from a supply point of view. As long as there is a supply shortage in a major area, it will be very, very difficult to see a decrease in housing prices, because there will always be that level of competition.

Cameron: Like you said, we need support from multiple levels of government and we kind of saw some embers of this a few months ago during the federal election. But at the same time you have a politician’s willingness to help in this situation and then you kind of have the power of the NIMBYism, because as much as you don’t want to accept it, you look at what it takes to form majority government in Canada. It’s only probably like four million people. You need thirty, two to thirty three percent of the people who vote, as you vote for your party. We only have fifty to sixty percent of people in general voting that draws the number down. So if you have enough people among that four million that are an unhappy because of NIMBY or something else, you see a great unwillingness for a government to try and come in and step in and make these changes. Because of how close the races are. Since we sit since we essentially are in endless minority governments right now to federal level, it’s hard to look at them and expect them to come in and help. So it many ways were kind of left on her own to try and figure out how to deal with this housing and affordability issue.

Cam Got too Political and Needed a Time Out

Christine: So before we get too political, we should probably call it a rap about there Of course, there is so much to discuss and unfortunately, this problem is not going away. I think the best thing that you can do is get as educated as possible. I mean it affects not just you and me: It affects our whole future as a society in our ability to retain good, educated people that want to be here long term. This is really one of those tipping points I feel in our history. As Canadians, where you know, are we going to fix things and give hope to the next generation, or are we going to slowly evolve as a nation to the point where maybe people don’t want to be here any more and that’s a very sad thought, especially when you think of how unique and Multi Cultural Canada is and all of our strengths?

Cameron: I think one of the frustrating things is. I look it back at my grandfather. He got discharged by the army, he got his job at the rail line and he was able to buy a house pay it off. Take care of a family of six and retire comfortably, and even just retirement and owning your home just seems so impossible these days. It’s easy to see why people get disenfranchise and frustrated, but it’s also why we need to take more personal responsibility to try and figure these things out. So we can at least have a semblance of what other generations had that really we kind of took for granted up until a few years ago.

Closing Thoughts

Christine: So, if you’re looking for an action item, education is always wonderful, but it really does start in our own backyard. It really does start locally and in our municipalities. So if this is an issue that affects you, bring it up to your local politician, bring it up to the people that can make these decisions and, from a personal point of view, make sure if you do have your own mortgage that you’re not just appropriately stress test from the banks, point of view from the lenders point of view. But that your budget can handle potential interest rate increases that could be coming down the road. So we want to make sure that people are not in the position where they’re going to be losing their homes if things get unaffordable and if their amortization is already as extended as it can be. There is a buffer there for a lot of people who have equity, but then again with the huge turn around and housing that we’ve seen. You know if, if you need a second opinion, please talk to a financial planner and just try and make sure that you are protected, that your family will be safe and that any of the changes that come can be managed.

So that’s it for today, we’ll have more interesting conversation next time. Until then from Cam and I, all the best