Topics That I Do Not Want To Discuss!


8 minute read

September 15, 2021


Is there an emoji for that?

If I put the word “sigh” in brackets, will WordPress populate a tired, frustrated, emotionally-withdrawn emoji?


Just one more thing I have to handle on my own…

We are only one week into the fall real estate market and already it’s feeling like November.  Murphy’s law, “anything that can go wrong, will,” doesn’t quite describe the last seven days, because everything that can go wrong, has.  Not just anything.  That would be a breath of fresh air.

Take today, for example.  Tuesday morning.

Today, we were scheduled to bring out three listings.

The first listing is pushed back because the home inspection found one strand of knob-and-tube wiring, so rather than list the house and risk buyers being deterred, we’re getting an electrician into the house to remove it, then a painter to patch the hole and re-paint the entire ceiling.  So we’ll be a bit late bringing that one to market.

The second listing is pushed back because hairline cracks in the 100-year-old plaster, which were filled last month, have re-appeared.  Our contractor has a special type of plaster/putty that’s flexible, so we’re going to try that, then paint, then list when ready.

The third listing, oh man, this is a doozie.  Imagine a 75-unit building where, if you’re lucky, you see three units per year listed for sale.  Now imagine that this morning, just as we’re about to click “Submit” on MLS to get our new listing online, we notice a nearly-identical listing came out this morning at 7:30am?  So, yeah.  Rather than listing today, competing, and dividing the buyer pool, we’ll list next week when they’re past their offer date.

Now, that’s just today.  I won’t bore you with the previous week, or feel the need to point to the clock right now and explain that there are several hours left in the day…

Cynicism aside, experiences like this are not ideal but they keep us on our toes.  This is how we keep sharp.  Without adversity, there is only complacency.

But how much emotional energy is left when all the problems are solved?

How do we see the rest of the world through our bloodshot eyes?

Today is one of those days, I’m going to admit it.  And I’ve been so burned out by the headlines out there regarding the real estate market, the election, and the intersection of the two, that I can barely stomach these water-cooler conversations, mutual rants with clients, and eventually, discussions on TRB.

Do we really want to discuss rising house prices, inflation, foreign buyers, a ban on “blind bidding,” shared-equity mortgages, the new first home savings account, debt-to-income ratio, and the absolute insanity of election promises?

I don’t.

Do you?


You probably do, otherwise, you likely wouldn’t be reading this.

I guess I’m just tired of banging my head against the wall, metaphorically and literally, since my son wouldn’t go down for his nap on Sunday and I actually banged my head against the wall.  I had a small mark on my forehead, and when my wife asked me what it was, I said, “It’s a mosquito bite.”

So what are the topics I don’t want to discuss?

I’ll have to narrow them down, but let’s get started…

Topic I Don’t Want To Discuss #1: The Insanity Of Election Promises About Bringing Real Estate Prices Down

Your name is Blake.  You’re a 23-year-old who is two years out of undergrad and you’re living in your parents’ basement.  Literally.  But also figuratively, in a sense that your entire life can be described by any sentence fragment with your name alongside the words, “…..who lives in his parents’ basement.”

You feel that you should be able to afford to buy a home in Toronto, notably that really cool brick-and-beam loft in King West, and you’re frustrated with the real estate market, capitalism, corporations, big business, “the man,” the new world order, and also Starbucks because they got your $8 latte order wrong this morning…

The candidates vying for the PMO’s office are all promising to “bring the price of housing down” and you think this is great!  Then you can afford to buy what you want!  I mean, if only prices dropped like, what, 70%?

So as a result, you vote for whichever party is promising to bring prices down the most, or “ban” the most things you don’t like, or build 30,000,000 houses in six weeks.

Blake doesn’t understand economics.

Blake probably didn’t take economics in high school because it was deemed “unfair to some students” by a leftist think-tank, but I digress…

Blake doesn’t understand that the real estate market in Canada is simply too big to fail.  The government can’t “tank” prices.  All those $500,000 condo buyers, with 5% or $25,000 down, can’t withstand a $150,000 price correction or the economy would collapse, and then society would collapse, and the government is never going to let that happen.

The CMHC is simply too big and has too much exposure, and what many of you are reading right now angers you, but you know I”m right.

I’m sorry.  I don’t run the CMHC.  I don’t like it either.

But you know as well as I do that candidates vying for office are simply yelling things into a microphone, all day long, and will continue to do so until September 20th.  None of this means anything!

And yet, we continue to talk about which candidates will do the most to bring prices down.

No, not just “make housing more affordable,” but rather actually “bring prices down.”

You think I’m joking?

“None Of The Parties Are Willing To Drive Down Home Costs”

This isn’t a random internet-dweller’s rant either.  This is an opinion piece from a professor at the University of British Columbia.

It’s insane.  It drives me crazy.  And if I see one more photo of a happy couple holding two children and a dog, in front of any newspaper article, I might smash my screen…

Topic I Don’t Want To Discuss #2: First Home Savings Account

“Hey, did you hear?  The Liberals are going to give us $40,000 to buy houses!”

Surely, somebody yelled that to a friend when the idea for the First Home Savings Account was announced, right?

For those who don’t read (at all, or beyond the headlines…), I can imagine that there was some confusion on this.

But what the Liberal Party has proposed is not giving people $40,000 but rather a tax-free account that would allow individuals under 40-years-old to save up to $40,000 and withdraw the funds tax-free with no obligation to repay those funds over time, unlike the RRSP.

This is a great idea, don’t get me wrong.  Kudos to the Liberals!

But for those people who can’t afford a home, there’ a catch: you still have to save $40,000.

How long does it take the average person to save $40,000 in after-tax dollars?

Or the better question: how long does it take a person, who might actually use this account, to save $40,000?

Because while there are some Canadians who can save that amount of money every year, they probably aren’t the ones who would benefit from this account.  In fact, the ones who can benefit from this account might not be able to save $40,000 in a decade!

This account is a great idea, but it’s a band-aid.  It’s, as the Financial Post, via Rob McLister, explained earlier this week, voter candy:

“First Home Savings Account Called ‘Voter Candy For Millennials’ By Mortgage Insider”

From the article:

The accounts meld together benefits of both a registered retirement savings plan (RRSP) and a tax-free savings account (TFSA), but despite the extra $40,000 of sheltered savings and the tax deductibility of deposits, not everyone is convinced the FHSA will help a significant number of younger Canadians enter the housing market.

“I don’t know how beneficial it’s (FHSA) going to be for a lot of the young people that are having a hard time saving up to buy a home in the first place,” said Jason Heath, a financial planner and managing director at Objective Financial Partners.

Heath said paying less tax is a good thing and describes the tax refund component as “mildly beneficial,” but noted that the extent of the savings would be in the hundreds or maybe thousands of dollars.

“That barely puts a dent in it,” Heath said, of the cost of entering the market.

While Heath sees some benefits, others see the FHSA as a purely political manoeuvre.

This thing to me just seems like voter candy for millennials, it’s quite redundant,” said Rob McLister, a mortgage editor at RatesDotCa.

McLister said that there are already two federal savings programs that can be used to save for a down payment.

Canadians already have the ability to take up to $35,000 out of their RRSPs penalty-free via the Home Buyers’ Plan, but most do not take advantage. In 2020 around 110,000 individuals withdrew funds from an RRSP account under the Home Buyers’ Plan, according to an email from Canada Revenue Agency. Of those individuals, only 17,000 withdrew the full $35,000.

Note the last portion in case you’re skimming: Only 17,000 of 110,000 individuals who borrowed from their RRSP in 2020 withdrew the maximum amount.

So what good is another tax-free account on top of this for those truly in need?

Topic I Don’t Want To Discuss #3: Banning Foreign Buyers

Every party vying for the PMO’s office has a plan for this, and if everybody’s jumping off a bridge, then dammit, prepare to take the plunge…

Tell me I’m binary, but we have to be all or nothing here, folks.

The Conservatives Party’s idea of a two-year ban is ridiculous.

Either we decide that only Canadians can own real estate in Canada, or we leave the door open to foreign investment in our real estate in the same way as foreign investment is open in a slew of other markets and industries.

I’ve heard both arguments before and they make equal amounts of sense.

Would Canadians balk if foreign interests took over all of our natural resources?   Sure!

So why do we allow individuals from other countries, whose dollar might go a hundred times further than ours, to buy up the homes in which our citizens would otherwise live?

You can structure a “fairness” argument if you want to, or an economic one.

BNN Bloomberg recently wrote this:

“How A Foreign Homebuyer Ban In Canada Could Backfire”

From the article:

“There are some Americans who buy property here, but there are a whole lot of Canadians that buy property in the United States and we need to be very very careful that the Americans don’t respond in kind,” said Mike Moffatt, senior director of policy and innovation at the Smart Prosperity Institute, said in a recent interview.

“You can just imagine all the snowbirds who have places in Florida, Arizona, Las Vegas, and all of a sudden they have to start paying an extra tax? If the Biden Administration or the governor of Florida says, ‘Well, the Canadians are going to do that to our people who own fishing lodges in New Brunswick? Okay, we’ll put a one per cent tax on any Canadian that owns a home in Orlando.’”

“Globally, we are often the foreign buyers and I don’t think Canadians would be too happy if we were given a taste of our own medicine,” he added.

Former Toronto Chief City Planner, Jennifer Keesmaat, surprisingly had this to say:

“Foreigners don’t vote so it is a really easy policy for the electorate to buy into, but I’m always wary of policies that aren’t backed up with data and analysis that demonstrates that they are responding to the crux of the problem,” Keesmaat said in a phone interview.

“The risk for me with these types of policies, I put them in the category of ‘buck-a-beer’ in that they get people excited but they don’t really do anything. It gives people the perception that some action is being taken, but it doesn’t actually address the problem.”

Words that I never thought I’d say: I agree with Jennifer Keesmaat.

This is, as the newly-discovered buzz-word explains, voter candy.

Not only that, I remain unconvinced that “foreign buyers” are paying the foreign buyers tax, because I don’t trust that the government is savvy enough to collect it in the same way that I don’t trust the foreigners are lined up to pay it.

Either ban foreign buyers entirely or shut up about it.  Because the taxes and the two-year moratorium don’t do anything to solve the “problem” in our market, which not a single politician seems to have actually addressed.


That’s a mouthful.

Let me come back to the topics that I don’t want to discuss, to discuss them, on Friday…

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

Find Out More About David Read More Posts

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  1. Bal

    at 7:41 am

    Nothing will bring home prices down other than high interest rates and lower immigration ….only these two things will impact house prices ….nothing else

    1. Appraiser

      at 9:05 am

      I respectfully disagree Bal, demand-side initiatives have proven woefully unsuccessful for over a decade now. Supply is the main problem and it is structural:

      “Canada’s population growth has outstripped housing starts for decades.

      Some analysts have said Canada has a “structural housing shortage” with the lowest amount of housing units relative to population of any G7 country.

      So what gives? With demand sky high, why can’t developers get more shovels in the ground?”

      1. Bal

        at 10:41 am

        what is causing demand? low interest rates attracting many investors and speculators. second immigration …if interest rates move higher and immigration lower… you are saying that will have no impact on the house prices ?

        1. Appraiser

          at 5:34 pm

          No. I’m suggesting that higher interest rates and lower immigration rates are not going to happen any time soon.

          1. Kramer

            at 9:54 am

            I’m happy the conversation is going this direction.

            So many people bring up average salary and it not growing much relative to housing costs and stop there and cry. Average salary means NOTHING ON ITS OWN in a rising population. For simplicity, let’s say a house costs $100,000 at some point in time in some confined city/province/country. If the population is rising and the average household salary even stays the same, then it means there are MORE (i.e. in actual number) people/households that can afford that $100,000 house. If supply of houses is not growing appropriately, then the price of that house will go up, even if average salary among that population stayed the same.

            Sounds simple when you dumb it down. But no one does it. Now: –
            Extrapolate that across an actual city or province or country
            Apply an “over decades” perspective
            Add in that interest rates have dropped over decades to near zero.

            So, people… it is time the conversation is moved along from “average salary”… on its own it is useless. The important income metric for a population would be something like “what is the growth/decline in NUMBER of people/households that can afford a $X00,000 home”. Something like that. And it would have to factor in interest rates somehow.

            What do you think the chart would look like if the description was:
            “Number of households that can afford to buy a $750,000 house”.
            Over decades, with Canada/Ontario/GTA’s population growth, with the increase in salaries over decades, and with interest rates all factored in… THE GRAPH WOUL LOOK BE PARABOLIC. HENCE WHY ARE WE SURPRISED HOME PRICES ARE WHERE THEY ARE?

            Only one answer to drop house prices… massive supply influx. I mean like we need a new medium sized city’s worth … and probably near Toronto.

          2. Kramer

            at 9:57 am

            PS: And anything short of that that Trudeau tries to do is just pissing in the wind and a government cash grab.

          3. Kramer

            at 10:19 am

            And please, everyone on this blog, all the usuals, if you like this perspective, please adopt it and run with it, spread it… I’m sick of this conversation. People need to understand. We cannot discuss this with a micro perspective… you have to look at this with a macro eye, over decades and decades… you’re talking about an entire population here… with every difference in situation under the sun contributing… there is no room for “anecdotal” shit here… and I have been guilty of that before, but NO MORE… this is one of the largest time-spanning macro cases ever… Don’t let yourself go micro, in government policy either, if you’re actually discussing how one would direct the movement of house prices. It’s a Suezmax oil tanker on a decades long trip, not a jet ski going over to the harbour for ice cream.

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  3. Ed

    at 9:09 am

    How long does it take the average person to save $40,000 in after-tax dollars?- David

    David from my understanding any money you deposit into that account you will be able to claim against your income similar to an RRSP and then when you withdraw those funds you don’t have to claim it as income similar to a TFSA.
    Best of both worlds and in essence pre tax dollars not after tax.

    I don’t agree with it though, what about those who don’t want to buy or are over 40. EFF em?

    1. Kramer

      at 10:05 am

      Sorry to come in and sound hostile… but none of this even matters. Implied by my comment above, this is such a micro factor vs. a freight train of macro power over decades. Anything Trudeau actually is DOES is firing a BB Gun at that freight train. This is election chinwagging… and you know that’s true because if he put in policy that actually moved the needle, it would have to be so huge that it would cost him the election – ie paradox.

      At this point, there are only two answers to real estate:
      Massive supply influx, and I mean MASSIVE, because population will continue to rise.
      Interest rates going up BIG, and that can’t happen without destroying the country.

      1. Kramer

        at 10:42 am

        Hilarious, furthermore, as per my comments all over this board… if one was trying to reduce house prices, then they would be facing a “problem” of too many people being able to afford houses against too little supply. And again, a problem over decades and large macro standpoint. From that point of view, making it easier for first time home buyers to buy a home is, if anything, just increasing that number of people who can afford a home. Way to go Trudeau!

        1. Mxyzptlk

          at 1:57 pm

          As Family Guy’s Brian Griffin would say, “THANK YOU!”

  4. Kyle

    at 10:12 am

    The FHSA, adds to demand, which if it has any impact, it will be to pressure prices higher. It doesn’t actually make homes more affordable in the long run. They would be much better off introducing a HSA type structure for those looking to add new supply (e.g. a basement apartment, laneway house, garden suite, sub-divide, duplex, triplex, etc).

    1. JL

      at 10:54 am

      Agreed. You introduce a measure like this, and prices will go up by a corresponding amount, because you’ve essentially unlocked more capital that can be thrown at real estate. A bit more nuanced, but essentially just like lowering interest rates.

      1. Condodweller

        at 11:12 am

        The irony is that this will actually make it less affordable for those who can’t afford homes now. High income earners will benefit more as they save more in taxes meaning they can afford to throw even more money at the offer in competition. For this to work it would have to be income tested.

    2. Kramer

      at 10:43 am


  5. J G

    at 2:29 pm

    Official inflation 4.1%, real inflation probably over 10%. Just look at price of groceries.

    Regardless of politics, interest rate WILL rise in the next 6 months. Wonder what’s that going to do to RE market.

    With stocks, I can sell whenever I want. And I did a bit of it during lunch, to harvest the massive gain over the last 18 months.

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

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