Condos in Edmonton means megabucks if you can find a renter/renters. A twenty percent yearly return sure beats a 5 year GIC paying 2 percent and no worries about CDIC insurance going insolvent. Presently it costs about double to rent rather than own a resale apartment or resale townhouse but that figure will soon be triple to rent rather than own as mortgage rates plunge. The liquidity crunch is almost over and mortgage rates will plummet.Posted by Tony on Thursday, April 2nd, 2020 at 8:02pm
You're assuming that rental rates will stay constant. But with oil jobs and public sector jobs disappearing, we may actually see Alberta's population shrink over the next couple years. Rents should also drop a fair bit.
Yes the mortgage rates did plummet, but I'm guessing once all the borrowers ran to their banks asking for deferred payments, the banks have bumped the rates higher fearing possible defaults maybe? I don't believe these rares will go down in the near term with many unknowns for the lender in terms of default. So I believe rent will definitely go up as Tony stated especially since it will be difficult to obtain a mortgage in this environment, unless you are working in the health field, or government sector.
Plus with the government ready to stomp on landlords ability to collect rent on time, evict and collect some late fees, who really wants to be a landlord right now? but if you are unfortunate enough to be a landlord as I am, then i'm guessing we WILL increase rent. There's a lot of risk holding several thousand dollar mortgage at this moment. The risk is up dramatically with no liquidity. The renters can leave anytime they want, move and have their freedom. There's very little incentive to be a landlord today . The government has clearly shown who they favor, and its not us.
A 20% return on condo rentals. Keep dreaming. After condo fees and insurance, you are lucky if you can make 5%. And that is assuming there are no mortgage payments. That is not an opinion. Those are facts. My accountant can testify to that.Posted by DK on Friday, April 3rd, 2020 at 2:15am
This will be big challenge to the bank, maybe compare to COVID-19 to hospitals. Western Country can't like China, the government announce everybody go back to work, people just go. People now believe science can fully control their lives.Posted by Sharon on Friday, April 3rd, 2020 at 3:01am
The truth is we can't even predict tomorrow's weather.Posted by Sharon on Friday, April 3rd, 2020 at 3:01am
The true science is people can't live without food. It's will be horrible when it happens.Posted by Sharon on Friday, April 3rd, 2020 at 3:17am
Going to be good for both landlords and buyers, in my opinion.
Lots of bankruptcies will mean more people looking to rent as they get kicked out of their house and don't have any more credit to buy a place. Plus, landlords aren't going to play nice any more since they know the government will screw them the first chance anything goes wrong.
Now that they've seen how easily the gov't allows renters to skip on rents, the landlords are going to be much more careful on who they rent to.
And if the government brings in rent controls, then it's going to get a whole lot harder for renters. Nothing will be available.
Buyers will also be able to snatch up bankruptcy bargains.
So both will win.
Losers will be the renters I imagine.
We are talking about pre world war 2 like recession. We are taking the peace for granted.Posted by Sharon on Saturday, April 4th, 2020 at 12:30am
Please don't talk about World War, I hope human being is now smart enough to avoid that kind of confrontation.
On the other hand, This CONVID 19 is worse and though we all have a common enemy, we don't seem to stick together to fight this. Countries are now again each others.
Really? Are we so lucky in a special time of human history only have peace regardless.Posted by Sharon on Saturday, April 4th, 2020 at 6:05am