Originally Posted by
ercchry
What? Tax payer covers $0, cmhc’s portion of the loss comes out of the borrow’s pockets/future earnings/garnishment/etc
What is affordable? Just a few years back $100k in income got you $750k, currently it’s about $500k, after this $420k
This is Econ 101, demand is artificially reduced by making homes “unaffordable”, not due to people not willing to lend and buy but due to regulations making it impossible to do so. If no one can buy at current market prices, market falls.
Yeah if you never want to move sure. Your life never changes, comfortable losing 18% of your home value cause you were never going to realize it anyways. Sure, great. Let’s ignore the paper gains/losses cause it’s just shelter.
I really don’t understand this viewpoint.
I would agree RE as a whole is a house of cards. We saw this in 08 in the states and look at what that did to the economy. But it’s been built, we have to live with that. It’s been taught generationally now that “your house is your greatest investment” is it theoretically correct? No, is it the reality of the majority? Yes.
Remember that the average human sucks, and this will cause ripples throughout. Shit, how do you think most people get businesses off the ground? Net worth and personal covenants, houses are collateral for these loans a lot of the time. You think small business needs another hit right now?
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Uh... cmhc insures 20% down... 35% down, hell... 95% down, you just don’t see it as the lender is paying it on the backend