Western Standard - Western Standard columnist Myke Thomas urges caution for worried homeowners

00:00:00.000 how's it going mike it's sad oh i can't believe you're not going to be doing this anymore oh yeah

00:00:07.200 your tears look as real as d's do you know it doesn't look very good oh well listen we'll be

00:00:12.860 the last visit on this particular uh this particular format or show yeah we'll see

00:00:18.860 keeping the door open things are just changing well they need to i mean i mean nothing but i

00:00:24.180 don't think there was a need for them but things change they evolve and they move along yeah and

00:00:28.500 uh no it's it's all good and uh i'm glad i could get you in on this this final week there's lots to

00:00:34.180 cover it's always fun when we get you in studio and cover some of this well we'll see what we can

00:00:37.700 talk about for you well yeah we'll start i guess with your specialty and that's the real estate world

00:00:42.640 we're seeing some housing starts picking up uh yeah relative well um that's a go fish number that

00:00:52.060 cmhc puts out i mean that's what they think is going to be by the end of the year could be more

00:00:57.340 it could be less but in reality and i mean it's good that that we that it's that number it needs

00:01:03.340 to be way more um even with prices and sales diminishing in the resale market uh there is a

00:01:12.400 a huge need for new housing stock of all kinds but more particularly multi-family and more affordable

00:01:21.740 product for lower income people um the rental market's getting crazy uh i saw i think yesterday

00:01:29.460 i was reading that the the rent on a two-bedroom condor apartment in calgary is pushing i think was

00:01:35.860 sixteen hundred dollars that's a lot of money yeah um the prices on on resale homes are

00:01:42.740 very slowly very slowly coming down sales are really really down but getting back to see me

00:01:51.580 seeing houses says they couldn't build enough i mean they need i think she went over they need a

00:01:57.020 million houses in over the next two or three years so that's just it can't happen so yeah she can give

00:02:04.240 you a shout out in that column actually yes that uh that he wrote recently that was on the western

00:02:08.420 standard is that self-serving plug westernstandard.news and you'll find shane's column where

00:02:12.700 he's talking about that as a home builder for people who aren't familiar with shane wenzel

00:02:15.800 and pointing out that we have a supply issue i mean no matter what you do how much you middle

00:02:20.800 in your market how well your interest rates are if you don't have enough supply it's going to get

00:02:24.260 expensive yeah and you know because it's my favorite topic and that is slamming the government

00:02:28.140 it is the government's fault government restricts new housing supply while at the same time

00:02:33.720 hitting the talking button to recruit increase it it's it's camera jet which that's camera jam kids

00:02:41.100 or something i can't oh cats and jam are kids that's getting i'm not old enough to remember at all

00:02:45.700 exactly yeah uh but it on the resell market things are slowing down um as expected the i'm looking at

00:02:54.120 calgary this morning and back in march which was a record sales month for calgary they sold something

00:03:00.620 up 4 200 homes which is unbelievable and i think we're on pace in august to do close to 2000 so

00:03:10.060 that's quite a dip um and it's got everything to do with with the rising mortgage rates um and the

00:03:19.420 there was a phenomenon going on called fear of missing out where people people were getting

00:03:25.180 qualifying qualifying for mortgages but supply wasn't very good so they'd rush out and buy whatever

00:03:31.100 they could get and so that helped bring the sales up it's a phenomenon that probably wouldn't have

00:03:36.460 happened have had the bank not bank of canada taking the rate down to 0.25 percent at the beginning

00:03:42.780 of the of the pandemic but like everybody else nobody knew how to handle that pandemic you know if

00:03:47.580 there ever was another one and there might be i hopefully hopefully we handled differently so now the

00:03:53.580 bank is making up for lost ground well and the bank's probably going to be cranking interest rates

00:03:57.420 further yet uh yeah september 7th is the next date um speculation there's some people who said oh

00:04:05.980 inflation's done inflation's down 7.6 yeah i was saying that earlier in the show we're all popping

00:04:11.900 champagne courts you know because it went down a half a percent in rise i mean it's just as i said

00:04:16.460 the best way you put is less bad than it was last month but it's still bad no but i saw some

00:04:21.020 chatter today on on the internet oh well the bank maybe will only raise it 2.5 percent then because

00:04:26.380 things are looking so more positive no no it's going to be a minimum of 0.5 i think 0.75

00:04:34.940 outside chance of raising it by one one percent i don't think they're going to do it at one nobody

00:04:40.300 expected them to do it last time so i don't know but by the end of the year i think we're looking at 3.25

00:04:45.580 percent um which is way above the bank of canada's uh normal comfortable rate but and and people have

00:04:54.780 to understand what kind of chill i mean outside of the real estate market i mean that prime rate

00:04:59.340 impacts capital expenditures a lot and we're talking about things like the energy sector mega

00:05:04.540 projects they're planning out in 10 20 year uh you know segments and they didn't necessarily take

00:05:09.820 into account that much more expenditure to get that thing rolling so i mean often they're going to

00:05:14.380 contract or reduce the amount they were going to build right but the the thing that might cushion

00:05:19.260 it well it should cushion it is the the lenders for the most part have already built in that 3.25

00:05:27.580 because they're they're looking ahead for that very reason um so a lot of the money that people are

00:05:32.780 borrowing right now is based on a bank rate of 3.25 so it's not going to go no but they're trying to

00:05:39.900 prevent that it makes them reevaluate some of their uh budgets so at that point and it leads to things

00:05:45.500 well we'll see what happens i mean you're still in for a rough ride for a while yeah yeah it's going

00:05:49.900 to be i don't know how rough it's going to be it's not going to be real pleasant but i think it's going

00:05:53.740 to be more slow than than like that i hope well yeah we'll keep hearing that uh recession word i i listen

00:06:01.660 to one economist saying we need a recession it's natural it's the way to correct things i mean i i don't know

00:06:06.460 if i can see it being natural in the cycle of economics unfortunately just with this borrow

00:06:11.420 and contract sort of thing but saying we need it is if it's a positive development or outcome

00:06:16.860 uh i mean i i think a better way to say is just it's probably inevitable well it is inevitable

00:06:21.740 and i guess you want to look at it as a need to be it's kind of like a medicine you got a fever now you

00:06:26.460 got to get something to get rid of it um so is it is it a terrible terrible thing no you know and are

00:06:32.700 we going to be in a recession i don't know um depends on your definition of what a recession

00:06:38.780 then they start dancing with what a recession is i was watching that game going on in the states

00:06:43.580 already yeah well that's funny down there it's not a recession yeah it is um there's been no

00:06:49.580 announcement here though uh in terms of officially in a recession i think we have to look at the gd numbers

00:06:56.060 what they were in july and we'll see that yeah we are in a recession yeah

00:07:01.820 well let's see what some of the other stuff you've been talking about you know you put

00:07:04.700 out some neat things some of the dream homes luxury homes i see you had an airbnb site that's

00:07:09.740 curved into a california mountain yeah that's in uh the joshua tree national park about

00:07:18.060 as close as i can figure an hour an hour and a half northeast of palm springs uh where joshua park is

00:07:24.380 the joshua tree park but they uh this house took 20 years to build and it's pure there's there's no

00:07:30.700 timber in the thing there's no drywall it's all natural rock and it's built right into the rocks

00:07:37.100 um it's it's an amazing uh house and is it expensive the bedroom the bed in the bedroom costs

00:07:43.900 five hundred thousand dollars oh wow well ten thousand a night to stay in yeah you can't buy the

00:07:48.380 house you could air and be and be it a three night minimum that's a pretty limited uh audience

00:07:55.420 obvi's talking about going down next week actually so i think oh yeah so he well he he's you know the

00:08:00.860 the standards flush with money now that they'll have me reducing that's right yeah so in the flush

00:08:06.540 oh wow well yeah you know what's funny because jane and i uh we have an extra suite uh attached to our

00:08:11.820 place so you know for this area and it's been going very well jane's you know fantastic host it's

00:08:16.140 an independent suite and airbnb's been fantastic to us out that way and i i can see more of that with

00:08:21.420 homeowners not so much on the 10 000 a night scale but that's another uh income generating

00:08:26.060 thing people can do is as the cost of housing goes up is if you've got that spare space you're

00:08:29.820 an empty nester and i keep those damn kids from moving in too long anyways well sorry it's rented

00:08:34.380 out you get the spare bedroom over there but you aren't getting the suite yeah um you know it's kind

00:08:39.500 of a growth area i saw a new story where they're fighting about that of course in toronto it's kind of

00:08:42.540 like the uber versus taxi and of course the hotels really hate airbnb oh totally and why wouldn't

00:08:48.540 it yeah but i don't know it's a good deal so you know if you got 30 grand and can get down there it's

00:08:54.540 probably once in a lifetime opportunity yeah i would think yes i'll keep uh an eye on the uh

00:09:01.260 lottery tickets and see if my chance comes about or maybe i'll just find a cliff and start carving my

00:09:05.420 own it'll probably happen faster than being able to spend 10 000 you just head out to brag creek and

00:09:11.260 do something out there maybe yeah well they used to let me work with dynamite in the past if i could get

00:09:15.020 a hold of you no no no no no no more dynamite for you i'm even sober now i barely blew anything up

00:09:20.620 last time okay so uh oh well we're gonna back a little i like reviewing the stories you know and

00:09:29.180 as i just to remind everybody you write about a lot of things real estate and so on but you

00:09:32.620 dive into the others with the uh trump under investigation for a violation of the espionage

00:09:37.340 act i mean this has been making a lot of news this this whole raid on the mar-a-lago uh mansion

00:09:43.180 and people all wonder what the hell's going on well you know i i envision the pinata you know

00:09:49.340 at the kids parties where they got the sticks and they're banging away at the

00:09:53.340 pinata full of candy and they're waiting for so trump is the is the pinata up there it's all

00:09:58.780 the little democrats running around with their sticks russian collusion this that the other thing

00:10:04.700 and so i think this is just you know another part of that they need to get something on this guy

00:10:10.140 uh trump uh we're only i think 80 days away from the midterms and they're sweating bullets

00:10:18.620 uh it looks like the democrats are going to get wiped out which i think is an overstatement i don't

00:10:23.500 think they're not going to be wiped out but they could lose control of the congress it's not looking

00:10:27.660 good for them in the middle not looking and um it's not that joe biden is a very useful president as

00:10:33.340 it is but should the republicans take the house down there he's he's lame duck he's done totally

00:10:39.740 done well and you start getting into that that stalemate going on i mean it's it's the american

00:10:44.460 politics is such a hornet's nest and the thing that always strikes me too is their elections as

00:10:47.980 much as they're so polarized and fight so hard they're still usually it's like 51 to 49 i mean it's

00:10:54.780 just such a microscopic line that they're moving on in that country well you know that's a good point

00:10:59.180 i was thinking about that the other day they're talking about the great division in the country

00:11:02.220 but it's like like you say 51 this 49 the other it's not really a great divide you know it's it's

00:11:08.460 the extremists on either end it's the same thing here it's the extremists on either end of the

00:11:14.460 political spectrum who get all the ink to get it make the most noise they get the most attention but

00:11:18.940 they're not really the ones uh that we should be focusing on now well it's so heated though i mean

00:11:24.700 trump i mean you know you see he was a bombastic uh i'm not a big fan of his to be honest i mean i

00:11:31.500 i still would vote republican if i was in the states i'm a conservative but boy i would have

00:11:35.820 hoped that oh couldn't our party come up with somebody better well you know there's good and

00:11:40.380 bad i i'm not i'm not real fond of his style the bombastic thing where the greatest always has been

00:11:47.740 i mean he's sending out uh on his social media uh true site uh things today that are like okay don

00:11:55.020 just back off a bit but i mean that we're canadians we're a little more laid back so maybe

00:12:01.420 but you've got to admit at least i this is the way i see it is that he did some pretty good things for

00:12:05.660 that country well he shook the establishment yeah and it was an establishment that needed to be shaken

00:12:09.820 up that's part of what the amount of this loathing is i mean they are still ticked off at how he rattled

00:12:15.020 their their perch uh you know including some of the republic republicans absolutely but again his style

00:12:22.300 yeah i don't know um that's like having the best hockey player in the world who just likes going

00:12:26.940 around slashing people with a stick but he scores the most goals but i mean i think maybe it'll come

00:12:31.500 to some ease if people get to the point of accepting or if he would ever say but there's nothing

00:12:35.420 much to expect him to say that he's not running again that you know you're you're finished you're

00:12:39.500 going to retire you're going to kick back there's nothing to hold trump once more than to be the

00:12:43.900 president of the united states again and uh whether or not it's going to happen i don't know i don't

00:12:51.100 either it's such a because uh again i'm sure the the the dems have got to be sweating because biden

00:12:56.700 isn't exactly what you'd call strong uh so he's most definitely vulnerable uh to a strong run but i mean

00:13:04.460 another term of trump and i can see a civil war breaking out well you might get one anyway well you

00:13:09.820 know so maybe maybe it's in the cards isn't it that can be i don't i don't know it's just so

00:13:15.500 bizarre and it just doesn't stop you know as i said it's just the headlines and and uh did he take

00:13:19.820 things from the office does he have cases of sensitive materials i mean he invoked the fifth

00:13:24.620 uh and they're quick to point out one of his own speeches when he said anybody invoking the fifth is

00:13:29.100 clearly guilty and then you know so now he's invoking well that's donald that's him i i know he's a

00:13:35.020 showman he's barnum bailey he's totally you you put a reality star in in the office and you got what

00:13:41.900 you're gonna get let's get back to housing for just a sure of talking about canada the united states um

00:13:47.980 i just want to say to the people out there that you're going to see things continue to go down a

00:13:55.020 bit you don't panic do not panic um everybody's situation is is different in terms of whether or not

00:14:01.740 you get to keep the house or you have to sell it stuff like that uh and i mentioned this because

00:14:07.740 you might start seeing things get even worse in the united states you have to understand down there

00:14:14.540 the rules are different buy a house you get a 30-year mortgage down there plus if you get into a

00:14:22.540 situation where you can't make the payments you go to the bank and say here's the keys see you walk away

00:14:27.900 and there's nothing they can do in canada that's not going to happen it can't happen because we've

00:14:34.140 got uh cmhc insurance uh the qualification stress test and stuff like that uh so don't if you see this

00:14:41.820 happening in the united states do not for a moment think it's going to happen here uh people people

00:14:47.820 panicking and putting their houses on the on the market for sale when they don't really need to

00:14:52.780 it can be a self-fulfilling prophecy that everything will go down the ditch a lot quicker

00:14:57.900 yeah well and that's advice that uh financial advisors give on just about everything anyways

00:15:02.060 with any portfolios look at the long game don't don't panic respond in reacting we've had andrew

00:15:07.580 rulin from integrated wealth management talking about that you know okay markets are dipping this

00:15:11.900 hang on don't don't rush out there i mean when you get a panic sell as you said with self-fulfilling well

00:15:17.020 then you it snowballs and you can get a collapse and then everybody gets kind of scared yeah i think to

00:15:21.180 figure everybody looks at understandably is value what perceived value of the house and somebody's

00:15:28.060 going to have bought a house at 350 that probably in in april rocketed up to 425 and now it's moving

00:15:36.220 back down to 350 and they think they're losing money but they're not that's what you bought it for

00:15:41.340 you know it's little things like that you've got to keep in mind and and don't take financial advice

00:15:47.180 from uncle ernie unless uncle ernie's a financial guy yeah a lot of people do that well i mean that's

00:15:54.220 part of uh you know i had i can't remember was a guest on a while back just on how things change

00:15:58.540 again it's not so much in the housing but in stocks i mean not that long ago you used to have

00:16:02.940 to go through a stock broker you'd have to talk to somebody who was licensed and ostensibly i mean

00:16:08.060 a lot of corruption among them and incompetency but for the most part had some degree of knowledge of it

00:16:12.540 and they would counsel a person you know don't jump in and out on this like that don't move around but

00:16:17.660 now a person can just get online click trade stocks and it added to the volatility of trade in ways

00:16:23.500 that they never imagined uh would happen and uh it still makes for a difficult to rely on a lot of

00:16:29.900 things in that market yeah completely so people don't buy and sell houses that quickly well so that's

00:16:36.380 in a world that i don't live in and i don't even want to think about we're still working on paying the

00:16:40.620 one we got now yeah no i know i know some people who were in that business they uh they do quite

00:16:45.900 well they're not then they're not shy students or anything like that they'll buy they'll buy a house

00:16:49.980 uh nine times out of ten the house needs renovations anyway so they go in fix it up

00:16:55.820 uh add ten or twelve thousand dollars to the sales price and go so it's not a bad deal for some people

00:17:00.860 there's a lot of reality shows about that i mean the flippers and things like that yeah why not i

00:17:05.500 mean pick it up you're taking you're assuming the risk i mean if you fix it up poorly or the market

00:17:09.100 collapses on you you're stuck in a house that you bought for more than it's worth that's not

00:17:12.140 that's you're like anything else like walking into a casino a lot of money walking out broke

00:17:17.340 your choice yeah no i've managed to do that already i know

00:17:22.220 right on okay well before i let you get running here what else are you working on what do you

00:17:26.300 get to look forward to uh i think maybe a patio in my future oh you mean for the rest of the week

00:17:33.020 i was thinking on your columns unless you're going to do a how-to or something on patio construction

00:17:37.660 i should do something on patios um i got a lot of things in in the in the mix right now

00:17:43.420 i was talking to nailer things are pretty slow right now so it's it mouth dog days of summer

00:17:50.220 middle of august things are going to pick up i think there's going to be a lot of things happening

00:17:54.940 right after labor day that are things are going to start moving pretty fast yeah things are going to

00:18:00.620 pop up right on well it was good to have you on one more time mike very appreciate it and i always

00:18:06.700 enjoyed coming on yeah and like to say we'll uh we'll see you around oh yeah i'm not vanishing

00:18:11.820 things are just changing all right all right i'll talk to you later you got it

Western Standard - August 17, 2022

Western Standard columnist Myke Thomas urges caution for worried homeowners

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