Join The Conversation: Q&A Session, Episode #2

Reader Mailbag

2 minute read

April 6, 2020


For those of you who don’t have the time to watch a 28-minute video, here are the questions covered, and the times at which they appear so you can skip ahead…


Question #1 from lanasmith3 @ 1m 37s

Was supposed to lease a new place for May 1st.

What should I do now?


Question #2 from melbme93 @ 3m 34s

Are home values expected to be impacted?


Question #3 from Appraiser @ 6m 45s

Hi David,

Curious to know what you are hearing and seeing from your investor clients and others regarding the keep your rent saga. Have any of your clients, colleagues or contacts been affected by non-payment of rent this month?



Question #4 from Condodweller @ 10m 11s

What I find a bit strange is how quickly people run into rent trouble. I mean the lock down happened on March 17 and given that paychecks are usually a week behind most people should have received full paychecks (or close to it anyway) even if they were laid off immediately. You would think that paying rent this month wouldn’t really be an issue for most.

This whole do not pay rent this month campaign doesn’t pass the smell test with me. I guess preserving cash for food etc. is what driving it. But even then, with EI plus all the emergency funding from the government kicking in I’m sure landlords would be willing to wait until the payments come in and defer the rent.


Question #5 from Condo Seeker @ 12m 38s

Hi David,

I know this isn’t on theme, but I’m curious which condo buildings you would classify as “luxury” beyond some of the well-known hotel residences. Nowadays, it feels like every condo is marketed as such. Are there buildings that you would say offer a higher-end experience in terms of amenities, larger suites throughout, etc?



Question #6 from Libertarian @ 16m 56s

Any inclination on your part to do similar analysis of houses? Either east or west end. I don’t remember off the top of my head what the codes are for each neighbourhood.

It’d be interesting to see which houses sold right away versus those that didn’t and still may not have.


Question #7 from Gregory @ 19m 08s

Can you comment on “the flood” of AirBnB properties coming to market – either via sale or long-term rentals.



Question #8 from Jeff @ 23m 48s

The Ford government just halted all construction, including condominiums. How is this going to affect the market in the short, medium, and long term?


Written By David Fleming

David Fleming is the author of Toronto Realty Blog, founded in 2007. He combined his passion for writing and real estate to create a space for honest information and two-way communication in a complex and dynamic market. David is a licensed Broker and the Broker of Record for Bosley – Toronto Realty Group

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  1. Derek

    at 12:24 pm

    David, it is a “world class” moustache. Period.

  2. Chris

    at 1:47 pm

    John Pasalis’ weekly update has been published. Highlights:

    – Sales down 58%
    – New listings also down 58%
    – Prices flat YoY, down 10% from late February
    – Price declines seem to have more to do with changing composition
    – MOI ranges from low of ~2 in Toronto and Durham, to ~5 in York

  3. Chris

    at 2:38 pm

    In other news:

    “Mass layoffs push Canada’s consumer confidence to all-time low

    Consumer confidence fell to a record low last week, surpassing even the worst numbers from the Great Recession after the coronavirus pandemic shut down much of the economy.

    The Bloomberg Nanos Canadian Confidence Index, a composite gauge based on a telephone survey of households, declined sharply for a third week as extensive lockdowns triggered mass layoffs. The aggregate index dropped to 42.7 last week, the lowest reading since polling began in 2008.

    The survey paints a bleak picture of economic anxiety across regions, age groups and most income levels.

    – Almost three quarter of respondents (74 per cent) believe the nation’s economy will worsen over the next six months, up from 65 per cent last week and more than double historical readings for this question. Until last month, the previous high was 57 per cent during the 2008 recession

    – The share of Canadians who say their personal finances have worsened over the past year rose to 33 per cent, the highest since 2013

    – Unsurprisingly given the layoffs, concern about job security has spiked. Almost one fifth of respondents now say they’re at least somewhat worried about losing work. That’s also the highest since 2013

    – The anxiety is spilling over into housing, with 35 per cent of respondents now expecting home prices to decline, the highest degree of pessimism for real estate since 2008”

    1. Appraiser

      at 3:14 pm

      And in other news today, Environment Canada announced that the sky is blue.

      1. Chris

        at 3:36 pm

        Sorry, are you trying to claim this was predictable?

        Because let’s not forget that only a couple short weeks ago, you were loudly claiming that this virus was overblown by the media, there would be no recession, and even if there was real estate would plow right through.

        But good try with the deflection.

        1. Condodweller

          at 8:15 am

          Excuse me for jumping in, but yes, I don’t see anything unexpected in this. I keep seeing comparisons to 2008/2009 while some compare it with WWII. I think the latter fits better.

          1. Chris

            at 8:50 am

            I’m not surprised you didn’t find this unexpected, Condo. Most people would have been able to see this coming. Most; not all.

            And feel free to jump in whenever you please! Nice to have some other commentators weigh in.

  4. Appraiser

    at 3:34 pm

    Meanwhile back at the empty theory laboratory, Ben Rabidoux is now declaring that banks will soon be pulling / and or reducing existing HELOC’s from homeowners. His evidence for spouting this nonsense is absolutely zero.

    He didn’t talk to or quote one single bank executive, risk officer or loans officer. Just dreamed it up – beacuse you know HELOC’s are demand loans.

    Constant rumor / fear-mongering seems to be this irrelevant “housing “analyst’s” only stock in trade.

    Having other supposedly respected analysts, such as Pasalis give it any oxygen at all, without even a cursory amount of scrutiny, is just sad – especially for a self-described “meticulous data scientist.”

      1. Appraiser

        at 4:08 pm

        Outside of digging up every single negative article that you can find on the internet, have you ever had even one single original thought?

        Asking for a friend.

        1. Chris

          at 4:09 pm

          Is your idea of an original thought those foolish and childish comments you regularly spew?

          Asking for a friend.

          1. Appraiser

            at 4:15 pm

            How remarkably unoriginal.

          2. Chris

            at 4:25 pm

            Tired of being wrong yet?

    1. Chris

      at 4:02 pm

      As for Rabidoux’s comments, which you presented without any context or elaboration (almost certainly by design):

      “My comments on HELOCs on @doughoyes podcast brought some interesting feedback. To clarify my view, do I think it’s likely that bank reevaluate undrawn HELOC limits? Yes absolutely I think that’s likely. Will it be an across the board response? No.

      Will the doctor with $5M net worth, stable job and low LTV be affected? Doubtful. But the small business owner in an affected industry who had $200k undrawn, could they find out it’s been cut to $20k? Heck yes!

      Do I think banks will call HELOCs outright? No, but important to note that they absolutely can. Would I be surprised if we find that some banks force amortize some borrowers OR implement new policies that force u to roll HELOC balances into amortizing mortgage at renewal? Nope

      Finally, I think it’s likely that banks rethink the use of encumbered capital as down payment on investment properties (ie borrowed off HELOC for downpayment). The BRRR playbook gets more challenging”

        1. Chris

          at 4:27 pm

          Only a few short days after you slammed Jake, now you’re back to quoting him eh?

        2. Chris

          at 5:25 pm

          “No one knows. We make educated guesses and think through potential ramifications. That’s all.

          It’s not like you and I never called each other to talk through what might happen if x. It’s what we do, man.”

          – Ben Rabidoux, in response to Jake’s tweet

          1. Appraiser

            at 8:40 pm

            I see you left out Jake’s rebuttal to Rabidoux. I’m sure it was accidental.

            “I find that too many people know too much on twitter. The endless speculation and opinions are held as supporting the anti-housing argument. I’m just tired of it. You’re right; NOBODY except the CEOs know. So I’ll let them decide.”


          2. Chris

            at 9:30 pm

            1) mortgagejake@mortgagejake isn’t a link to anything. Try this instead:

            2) See that little time stamp at the bottom of his tweet? The one that says 6:14 PM? Now glance up, at the time stamp beside my previous post – notice that it says 5:25 PM? I’m confident even you will manage to piece those two facts together.

            3) I see you left out Jake’s other response to Rabidoux. I’m sure it was accidental. Here it is:

            “Now, planning for worst-case scenario: i get that. That’s totally normal and to be expected.”

            4) “Time to get a fire extinguisher to put that hair out Jake.” – Appraiser, March 19, 2020

            “P.S. Pretty irresponsible Jake. I thought you were a pro.” – Appraiser, March 21, 2020

            You’ve done quite the 180 on Jake lately, huh?

  5. Ed

    at 5:24 pm

    Man oh man, I’m really getting tired of you two. And I don’t think I have to mention any names.

    1. Chris

      at 5:26 pm

      Bal and Francesca?

      1. Bal

        at 7:34 pm

        Chris – I enjoy your and Appraiser’s comments… two of you keep the flow going….( yes no doubt sometimes you guys go …overall it is fun to read your comments….

        1. Condodweller

          at 8:38 am

          I think it’s good to have counterbalance to the permabulls however Chris lowering himself to appraiser’s level is unfortunate. I guess it’s like fighting in hockey. It’s a distraction from the game but fans love it.

          1. Chris

            at 8:42 am

            I disagree. When I start telling people to bite me or yelling about bull boners, feel free to call me out for lowering myself to appraiser’s level.

            I’ll make no apologies for continuing to argue against the rubbish he posits.

          2. Condodweller

            at 9:26 am

            Wanting to call out rubbish I get. Continuing to argue about it is what I find futile but it’s your time and energy.

          3. Chris

            at 9:40 am

            That’s a fair position to have. And I don’t really expect to change his mind.

            But I’m alright to spend a few minutes here and there countering some of the absurdities, such as the virus being media over-sensationalism.

            Like I said, call me out for sinking to his level when I start launching into ad hominems or childish rants. Until then, stick to calling me out for simply wasting my time!

    2. David Fleming

      at 9:44 am

      I don’t think it’s possible to get tired of these guys.

      The level of committment is so impressive!

      1. Bal

        at 10:24 am


  6. Chris

    at 9:32 pm

    “TSX rallies into bull market as virus optimism emerges

    North American equity markets rallied into the close of Monday’s trade, with Canada’s S&P/TSX Composite Index notching a more than five per cent gain to help the benchmark index rise more than 20 per cent from the March 23rd low.

    Risk assets like equities were lifted by some cautious optimism about the pace of growth in COVID-19 cases potentially slowing.

    South of the border, the S&P 500, Dow Jones Industrial Average and Nasdaq Composite all rose more than seven per cent to post their largest gains since the March 24th rally.”

    Hey appraiser, usually you’re so good at sharing stock market news! You missed this one!

  7. Chris

    at 9:47 pm

    “More than three million apply for COVID-19 job benefits as virus crushes labour market

    Government officials said Monday that 3.18 million people have applied for employment insurance and the Canada emergency response benefit since March 16. More than 640,000 Canadians filed for benefits on Monday alone, the launch day for CERB’s application system.

    Once the damage is tallied, Canada’s job losses will likely be record-setting. The Conference Board of Canada on Monday said a combined 2.8 million jobs could be shed during March and April, equal to nearly 15 per cent of total employment.

    “When you look at this in comparison to other recessions, I don’t think there’s anything like it,” said Pedro Antunes, chief economist at the Ottawa-based think tank.”

  8. J G

    at 11:47 pm

    I disagree with David’s response on downtown young professional renters paying $2200/month not being impacted. I know many companies in finance, IT, professional services going thru layoffs right now. These are people with salaries in 70-120k range. Most have savings, but if this lasts for a few months then for sure there will be impact on rental market. I think DT condo rent will probably decreased this year *gasp*

    -many units from Airbnb will come on the rental market
    -the aftermath of this is many companies, esp. in IT will adopt more work from home esp considering time of commute, and technologies like zoom or skype.

    1. Chris

      at 9:42 am

      CIBC’s Ben Tal is estimating that 70% of rent was paid in April. Pretty good, though that still leaves 30% unpaid. Will be interesting to see how these numbers shift in coming months.

    2. Natrx

      at 2:35 pm

      I definitely agree with your statement and view. But there are some in between lines I took from it. Generally, it is more true that a ‘AAA’ tenant (salaried job) will make as much of an effort to pay rent. If they get laid off, they’ll get severance, might have more savings in the banks. So let’s say they net about 10-20K from a severance, and or with savings. They’ll still make that next payment more likely, or try to work something out with the landlord vs someone who has a lower end job, that got cut, and has less than 5K in the bank, or a lot of credit card debt. I already know a couple literally as soon as their retail/food place shut down, they were already in deep trouble. As a % of income, they spend alot more on brand name goods, games, etc.

      But I definitely agree, higher end salary jobs will get hit, including tech sector, and jobs that rely on continued income or transaction growth (Big-4 business project work business model which has already started cutting).

      Interestingly, I haven’t known of any of my finance friends, ex-colleagues, getting laid off or anybody in their department yet. I have a feeling if things don’t turn by fall, it’ll be alot more noticeable.

      I will say, I diverge somewhat with David’s assessment on one thing. He mentioned alot of lower quality borrowers rent old REIT owned buildings. While that may be true, there’s still alot renting basements, or rooms, a floor in a house in the junction, parkdale, annex etc. So any of those home owners may get hit. But it’ll be harder to see as a trend. Conversely, there are a lot of highly tipped restaurant workers that are also living in those condos too, also often sharing with a friend or partner. Alot of ad agency jobs too that rely on a strong market. So those condo profiles will also chip away.

      1. Jimbo

        at 4:31 pm

        With the basement rentals and room rentals I’m pretty sure they are not protected by the new eviction clause.

  9. J G

    at 11:58 pm

    Dow and S&p surged another 7% today. Now down 22% now from February 2020 peak (which was already very elevated).

    The recovery from -35% to -22% was very quick, but another poster believes it’s dead cat bounce before heading to zero.

    1. Appraiser

      at 11:27 am

      Don’t recall anyone saying the stock market would go to zero.

      I would caution against being caught in a bull trap though.

  10. Condodweller

    at 8:57 am

    The air pocket analogy is a good one. It’s interesting to note that the average recommended emergency savings is 3-6 months worth of expenses which is about the same time the current situation is expected to last. I wonder if this will change behavior going forward.

  11. Graham

    at 9:19 am

    David, your comments about ripping MP3s off of YouTube killed me.

    I’m sure back in 1997 a teenage David was downloading MP3s off of warez sites to listen on his computer and using your 2X CD burner to make mix CDs to play in the car.

  12. Appraiser

    at 11:45 am

    Some interesting insights from Mr. McLister today :

    “Temporary Income: Some lenders are now considering government COVID-19 assistance as income when re-underwriting already-approved mortgages where a borrower has been laid off. Borrowers getting insured mortgages have less to worry about if they lose their job between approval and closing. That’s because CMHC, for one, is still allowing lenders to close such mortgages in many cases. Borrowers getting uninsured mortgages face higher risk of COVID layoffs killing their approval, or at least reducing the approved loan amount.

    Eight million Canadian consumers are at risk in a downturn, but only a small percentage will default, TransUnion says.”

    1. Verbal Kint

      at 12:20 pm

      “Borrowers getting insured mortgages have less to worry about if they lose their job between approval and closing.”

      Best to use a smiley or a sarcasm tag if you’re quoting this for comic effect. If you’re not, the joke’s on you.

      1. Appraiser

        at 12:30 pm

        Take it up with CMHC or Rob McLister, unless of course you work as a mortgage underwriter and have some inside information to the contrary.

        1. Verbal Kint

          at 12:36 pm

          The joke’s on you.

          1. Appraiser

            at 1:38 pm

            So you have no particular insight on the matter. Got it.

  13. Appraiser

    at 12:11 pm

    “…Most pre-construction condo deposits don’t come from investors saving their pennies – they come from HELOCs.” ~ John Pasalis, April 4, 2020.

    Fascinating declarative sentence there. Only when called out on it by Brian Persaud as to where he got that statistic from, Pasalis admits: “Well, there is no public dataset on the source of people’s down payments for pre-con condos – so just anecdotes.”

    Meticulous data scientist you say…hmm

      1. Appraiser

        at 12:34 pm

        Battle of the anecdotes.

        1. Chris

          at 12:46 pm

          As John said:

          “Well, there is no public dataset on the source of people’s down payments for pre-con condos – so just anecdotes.”

          1. Appraiser

            at 1:36 pm

            Still doesn’t absolve him of the first declaration. If he had stated from the outset that “in my experience…etc.”

            In the end, I’m pleased to see his statement has been clarified.

            There is also the distinct possibility that some deposits are a combination of personal assets plus borrowed funds.

          2. Chris

            at 2:04 pm

            Ideally, yes, he should have included that statement from the get go.

            Though, in practice, whenever someone like John Pasalis, Scott Ingram, Mortgage Jake, Ron Butler, Ben Myers, Will Dunning, Ben Rabidoux, Steve Saretsky, etc. etc. makes a statement unaccompanied by data, we’d probably be correct to assume it is based on their opinion and/or professional experience.

            Twitter has a character count limit, so unsurprising that they don’t always include those qualifiers.

          3. Crofty

            at 8:01 pm

            Rather than using the twitter machine, with its character count limit, they could write a blog instead. But that would be way too time consuming, I guess.

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    at 4:47 am

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    at 7:16 pm

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Pick5 is a weekly series comparing and analyzing five residential properties based on price, style, location, and neighbourhood.

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