Sell, buy, rent

April 22, 2021   ·   0 Comments

By Constance Scrafield

We appear to be in the grips of an additional health issue: the real estate crisis that is sweeping the land, prices out of control and a whole new take on how much a house, apartment, basement apartment is worth. How much is a property worth? Think this doesn’t matter to our health? Think again.

Funny how Covid is not a threat to real estate, how it is considered essential: the online joke about putting your house on the market so your parents can come for lunch and that is not, actually, funny because it speaks to the state of folly in which we are living. That strangers can come into our homes and walk about, holding the banisters to go up and down stairs (they are not supposed to but a person might not want to risk falling) but we are not supposed to have people we are close to in the house, is crazy. It is crazy that strangers should be in our homes at all.

What puzzles me is the wild rush to sell that these times are seeing. The prices of houses are escalating in a dangerous way and part of that danger is the change to the way in which property is being handled. Here is the psychological edge: that people are being conned into selling their homes because they are impressed with the kind of money they are making between what they paid for that home, whenever it was, and what they can get for it now. As they sold, so must they buy. The intense increase of property prices will be passed along when sellers go on to buy a home elsewhere; so, the disproportionate prices of property will spread across the province, across the country. 
Truth is real estate is not essential, given the dangers of strangers walking around in your house. Are you forced to leave or do you hide in a (walk-in)) closet? 
Why does anyone “need” to sell during this pandemic? It is because prices are over the moon and ambitious agents are pressing, while they have people with lots of money wanting to buy.
Money- is it the sole definition? When you get it, will you go to live on a cruise ship? Maybe not now .. downsize to Thunder Bay? Away from community and friends? Always more people to meet – right?

In our own hunt for a place to rent, Patricia and I have met one landlord after another, saying, “We’ve just bought this place.” Too often, that property is for rent, as is, and I am not sure what the rules are about the condition a place may be in, to qualify as a suitable rental place. I don’t know if there are any kind of guidelines as to what the rental price for a house, an apartment, a basement may fetch. What I do know is that new landlords are looking to rent small houses consistently for $30,000 a year.

So, what is the average wage of a family these days, these pandemic days, when the government is still handing out assistance to people who have lost their jobs or their business? Let’s see now, isn’t it something like $2,000 a month? Taxable, of course. Hmmm, sounds like $24,000 a year. Okay, so that is desperate measures, for a person with no other income- well, that could be the case. Let’s say it is a couple, each garnering this assistance, and so, it comes to $48,000 a year, which still doesn’t leave much after $30,00 of it goes to rent – but, wait a minute, there are utilities added to the rent: hydro, heat, maybe water, internet.

In such a hurry, this is what worries me; selling and buying and renting are happening in such a hurry. I mean, you have to be happy for the real estate agents – aren’t they making hay while this sun shines! Who can blame them!

Every social upheaval, which this is – think about it – has an underlying catalyst and it behoves us to recognize what that catalyst is. The money flooding the real estate market is not coming solely from within Canada. There is huge foreign investment in the real estate market in this country, which would be alright, perhaps, if it were not making such a really devastating difference to the perceived value of real estate.

For sure, there are people in Canada, who have done very well in business through Covid, who have found clever ways to produce products and services – of benefit, I hope – that has brought them solid incomes, maybe even wealth. However, worldwide, there are seriously troubled political situations, causing millionaires to take their money and want to pour it into – well, property in Canada. This is not new, particularly, inasmuch Toronto and Vancouver have had huge foreign investment in property there for decades.

What is happening now, though, is different. It is not the purchase of hundreds of condos in the cities, being bought and left empty. 

It is the abrupt change of land value everywhere.

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