Canada-US merger? Meh!

In My Humble Opinion
121

It was neither luck nor “privilege”. My parents were poor immigrants and my dad worked hard for meager wages. They built their small savings from scratch by scrimping and saving and sacrificing their own comforts to only three priorities: owning their own home (mostly for the sake of the kids) and raising and educating their children. They were deeply cynical about the stock market and never touched it. I learned over time to respect their values of education and home ownership.

I had a pretty good professional career but the low point came when major sea changes in the industry literally wiped out the multi-billion dollar company in which I had staked my career. It’s only a slight exaggeration to say that some extraordinarily well-timed real estate booms made the difference between a comfortable retirement and living under a bridge.

There was certainly luck in the timing of some of the real estate booms we’ve had, but please tell me how much of this was “privilege”. My home ownership came from my own resources from simply having a job, with a small amount of assistance from my parents’ lifetimes of careful savings. Where does this “privilege” thing come in?

I notice you’re harping only on this home ownership thing. The country rankings by quality of life I think is good support for my other points. Not all such surveys are the same, of course, but they tend to follow similar patterns, with Canada generally near the top and the US much further down, although everyone acknowledges the US is a great place for billionaires, investors, and well-financed entrepreneurs.

122

I think I’m about the same age. My ‘privileged’ generation graduated high school in the throes of a deep recession. Then were treated to a decade of sky-high interest rates to fix the stupidy of the previous generation. Mortgage rates were 13.5%. Car loans were insane. There was lots of talk then about the ‘affordability crisis’ and how young people were screwed because of interest rates and high unemployment.

Speaking of that… In 1981 when I graduated high school the unemployment rate in Canada was 13.5%. For young people, it was over 20%. We all took any crap job we could get, because a lot of us could 't get a job at all.

For decades Canadian economists told us that Canada’s ‘natural unemplyment rate’ was between 7-8%. Now it’s below 5%.

As for the housing affordability crisis - that’s really location dependent. When I was starting out, it was assumed that you would have to move to find opportunity, and all my friends except one moved from their childhood home city to find work. Now you might have to move to find cheaper housing.

I live in Edmonton, a fine city with a great university. Do you know you can buy oodles of apartments here for $100,000 or so? Townhomes with a yard can be had for $150,000. Starter homes for $250,000.

A $100,000 mortgage at today’s rates is a little over $600/mo. If you can come up with a $10,000 down pay,ent, $550. Our first mortgage was $143,000, and we paid almost $1500/mo because of interest rates. And that was in 1991, when $1500 was a lot more money. We didn’t have the flood of cheap Chinese goods then, so everything we bought from electronics to clothes was more expensive. My first VCR cost me almost a month’s salary.

And moving and everything else was way harder back in the pre-internet days. Learning things yourself was much harder. And the only ‘gig work’ around was a day laborer job woth a pickaxe or shovel.

Every generation has its challenges. One of this generation’s is that if you live in the GTA or Vancouver, you might have to move if you have a low income and want to own a home or rent a decent place. But there is a ton of opportunity in places like Edmonton or Regina or Saskatoon or Winnipeg or any number of smaller cities and towns where real estate did not go insane.

123

Are you, perhaps, under the impression that people with equivalent background and characteristics could become homeowners today? Not in Metro Vancouver.I suspect not in Metro Toronto.

124

Those two places have been unaffordable for decades. I would love to live in Vancouver, but I knew 20 years ago that it was not affordable unless you were well off.

So the obvious answer is, “Move out of Metro Vancouver or Metro Toronto.” Why is this hard? Labor mobilithy has always been a thing, and is important not just to the health of the country but to the living standards of the people who do it. No one is entitled to live wherever they want, and the internet and work-from-home has made it easier to move and live elsewhere than it ever was.

Young people should focus more on the advantages they have and how to exploit them, rather than wallow in self-pity. Unfortunately, there’s an army of politicians and activists out there actively telling them that they are miserable, have every right to be miserable, but giving support to the activists and politicians will fix everything.

125

“Why is this hard?”—because the poorer you are, the more you rely on your extended network of friends and family; you are less likely to be able to travel to and set up in a new place. Do you really think that just anyone can easily up stakes and is lacking only the will?

I did it myself with no savings, but I had a lot of advantages (education, no kids), and of course the immense privilege of the Bank of Mom and Dad for a down payment.

126

Well, I did it myself with none of those things. No support network, no help from family. Just my beat up car with the back stuffed with my things. I got a room in residence at the U of A for a couple of months, worked a part-time job to pay for it, until I found a roommate and an apartment.

It was tough, and it was scary. There was no internet to scout out the city or look for apartments and jobs. You had to get a road map, find your own way around, find out where the unemployment offices were and go to them, etc. More than once I was down to ‘Kraft Dinner’ money a week before the end of the month, and had to just suck it up. No spring breaks for me (I had to work full time then to bank a little extra), and no clubs and parties.

And it was just what you did. We didn’t have a choice. I would have killed for the opportunities young people in my position then now have. And thank God we didn’t have a UBI or anything like it then, because it would have been very easy to stay in my home city, throw up my hands and say there’s just no jobs for me there, and live on the dole. I was surrounded by people who did just that on welfare.

My wife was also poor and had no support. She wanted to go to college but couldn’t manage it, so she went to nursing school and became a nurse, then she went to college later and got a Masters when we could afford it. She had to move out of her town first to go to another town with a nursing college, then she had to move from there to Edmonton to find work. She couldn’t get nursing work at first, but rather than whine about being a nurse out of work she took a job in the hospital changing sheets and such. She eventually made it into nursing, then management, and is now an executive in Alberta Health.

Young people are poor. That’s part of being young. The challenges of building a life and a career from nothing are part of life for the 99% of us who didn’t grow up with a silver spoon in our mouths. It builds character and teaches you life lessons. We need to be telling this to young people, not feeding their depression with tales of politically-moptivated woe.

Oh, I forgot to post this before. Here;s a typical apartment available here. This one is $125,000, and has a $300/mo condo fee.

https://www.realtor.ca/real-estate/25603942/241-10636-120-st-nw-edmonton-queen-mary-park

Two people could live there for $500/mo ea including fees. Edmonton is full of apartments in that range.

127

Probably not. In March of last year the average price of a detached home in Toronto proper (the so-called 416 area, not the suburbs) exceeded $2 million for the first time – and that average includes crappy houses in crappy areas – but has since declined about 8%.

But I don’t see that that has anything at all to do with this discussion. It’s not my fault, and not Justin Trudeau’s fault. I didn’t conspire to make it hard for young people to own a home. It’s the result of complicated economic, population, and demographic factors and it’s a global issue, not a Canadian one. If you think house prices are outrageous in Toronto or Vancouver, try buying something in London (England) for example.

It’s not something that politics can readily “fix”, if “fix” is even the right word. I’m sure that anyone looking to buy a house for the first time would be delighted if the housing market collapsed, but market instability isn’t good for anyone in the long run. This discussion is about Canada, and in that context, the Canadian government has kept the banks honest and prevented the kinds of financial scams that precipitated the US housing market collapse in 2008, keeping the housing market stable and robust.

128

It’s like when someone survives a car crash without a seatbelt. It just shows how weak and stupid every other sheep was who died.

129

No one said it was.

130

Maybe check the relevant prices and wages NOW. What you did DOES NOT WORK anymore, no matter how much grit and determination you have.

131

Minumum wage: $15/hr.

Two roommates who work minimum wage, 35 hours/week. Gross income each: $2250/mo. Household income: $4500/mo.

Tax: $450
Canada Pension + UI insurance: $380
Mortgage: $600
Condo fees: $300
Utilities: approx. $300
Two phones + Internet: $200

Basic costs: $2230

That leaves $2270 for everything else. Trnsportation, food, etc. Seems more than do-able to me.

Renting is more expensive, but there are lots of apartments for rent in the $1,000 to $1500 range, minus the condo fees. add that instead of a mortgage, and you’ve still got $1600 - $2100 per month for expenses. And that’s at minimum wage. Lots of jobs available that pay a lot more than that.

BTW, I lived in three different aprtments in Edmonton in the 80’s. My studio was $375, a one-bedroom was $500, and the two bedroom I later shared was $800.

Using the Canadian Inflation calculator, those amounts are $953, , $1250, and $2001 in today’s money.

So, whether buying or renting, housing in Edmonton is as cheap or cheaper than it was 40 years ago. And 40 years go the minimum wage was $3.75. And as I mentioned, everything was expensive back then because of high interest rates and lots of barriers to trade.

No, you can’t live like this in Metro Toronto, or Vancouver, or San Fransisco or Manhattan. Boo hoo. Suck it up like we did, and move to one of the hundreds of cities and towns that have totally reasonable costs of living. There are cities in the U.S. even less expensive to live in. Nice ones, too.

None of this includes the government social programs for the poor.

132

You’re assuming they had some wealth in their back pocket to get a mortgage, which requires a hefty down payment. And would you get a mortgage with a roommate? Not the best plan. And, of course, it’s not super easy to get a mortgage when you don’t have a proven credit history.

I just don’t think it’s as easy as you want it to be.

133

As I said, renting is only slightly more expensive than mortgage + condo fees. A couple of hundred bucks more.

Of course it’s hard. Starting out a new life is hard, and always has been.

134

It was not so long ago the federal Liberals were a third place party and no one wanted to lead it. Trudeau has rebuilt it. He is indeed privileged, but he does care about the social issues he espouses (sometimes too much). However, his record is mixed and several of his decisions have been questionable… But he isn’t greatly responsible for the housing crisis, which is complicated, largely in areas close to cities and not really well addressed at any level of government…

135

I can think of multiple ways in which Trudeau has contributed to the housing crisis.

First, the lockdowns and the required work-at-home triggered the movement of people into houses, driving up real estate prices in the GTA.

Second, his ramp-up of immigration and housing them is contributing to demand for housing, but it’s probably a small amount. Not sure, though.

Third, the inflation generated by the lockdowns and borrowed spending has raised the cost of living, including housing.

Fourth, the First Home Savings Program is spectacularly bad legislation that will have the effect of subsidizing the first home of the children of wealthy people or young well off professionals while driving up the price of real estate, and the lost tax revenue will be made up by everyone else.

Fifth, carbon taxes and green initiatives have driven up the cost of utilities substantially.

136

Fascinating explanation, since the housing boom in Toronto has been going on for more than 50 years.

Again, not a Trudeau issue. Canada has been welcoming to immigration since forever. Immigration is focused on qualified workers including well-educated professionals, who are a strong net benefit to the economy.

Again with the lockdowns. Would you rather we all died of COVID? Lockdowns were a key part of the strategy to control COVID throughout the world, Trumpworld excepted.

Some posters here are complaining that Trudeau is personally responsible for making it impossible for first-time buyers to afford a home, while you’re complaining that Trudeau is personally responsible for helping first-time buyers afford a home. I’m confused.

And, pro tip: the First Home Savings Account is not for “children of wealthy people”. With the annual maximum contribution capped at $8,000 these hypothetical wealthy children aren’t likely to be much interested in the FHSA. They probably spend more than that on occasional detailing for their Porsche Panamera Turbos.

For some right-wing definition of “substantial”. I suspect that the rise in the cost of utilities (along with everything else) really would be quite substantial once climate change destroys half the planet. The conservative/libertarian Fraser Institute has expressed sentiments similar to yours, but instead of blaming Trudeau they focus on rising electricity prices in Ontario, blaming them on a liberal fixation with clean energy. According to them (not making this up) Ontario should still be running coal-fired power plants. It’s hard not to get the impression that conservatives are actively trying to destroy the planet.

No one really loves carbon taxes, but pretending that no externalities should be priced into the cost of fossil fuels is just reality-denying nonsense.

137

Of course Trudeau plays some role, but not as much as provincial and municipal governments.

COVID was not Trudeau’s fault. WHO estimates twenty million people died due to COVID. Although I don’t like some of the decisions made, on the whole Canada acted reasonably. If anything, it made some people not want to live in overpriced cities.

Canada needs more immigrants. We should pick the best and brightest ones, provide real value to international students (fair pricing, real courses, no sham schools) better to encourage them to stay, but be sympathetic to refugees and those endangered. Prices in metropolitan areas have risen due to demand, with a modicum of greed. There should be more encouragement to help other areas grow outside overpriced cities, and the federal government could play more of a role in this.

Inflation has affected prices. Some of this was due to supply chains, quantitative easing and supplements. The worst thing about Trudeau is thinking you can ignore debt, significant provincial debt and future debt by emphasizing percentage of GDP or creative accounting, which is short sighted. Unfortunately, however, no major party really wants to balance budgets. I agree the First Home Savings Program has laughably low eligibility limits, and seems unhelpful in many markets.

Ontario phased out coal plants. Energy is much pricier. But the air is noticeably cleaner. Green initiatives are unavoidable and sometimes make good sense, others involve trade offs.

But the provinces might resent federal direction on this issue and their powers are limited. There should be support for builders and increased density. But they should also contribute to infrastructure, meet aesthetic standards and maintain the character of established communities. Canada has enormous amounts of land, it does not seem an insurmountable problem.

138

It’s simple. Today’s main Conservative policy plank is “I hate Trudeau and so should you”.

Every Single Problem is Trudeau’s fault. Personally.

That’s all. All you need to know.

139

I mean, that lasted four years. 2011 was a fluke. Many people contested the leadership race Trudeau won.

I don’t understand this claim. Are you saying Toronto’s increase in housing prices has been going on like this for fifty years? Because… it has not. Housing prices have always gone up, but we’ve seen some unprecedented explosive growth in the last while. I’m also not sure why we’re just talking about Toronto.

Has the Trudeau government contributed to this? Absolutely they have. But the roots of this problem go WAY back - at all levels of government, at least back to when Justin Trudeau was in high school.