Troubled

The inflation number starts with a ‘2’. Mortgages these days cost half the 20-year average for rates. The carbon tax is gone. The increase in capital gains taxes was scrapped. The stock market hits a fresh record high routinely. House prices have fallen in 2019 levels. And Canada has stood up to the tariff assault of our biggest trading partner in a way economists thought impossible.

And yet, the moaning never stops.

Look at the comments here yesterday. So typical. And it all comes down to the reason this blog crawled out of the primordial muck eighteen years ago – the troubled future of real estate.

Our housing fetish drove prices insane – since Canadians buy on emotion, not logic. We created massive risk. Now we harvest it. Even in the midst of what could soon be the greatest housing price correction in national history, most people think it’s not enough. They want blood. They’re angry at valuations. Their inability to get what they want has led to stress and strife. More to come, apparently.

As mentioned here yesterday, clever professional politician Pierre Poilievre knows how to capitalize on the angst. And it would appear this week he’s making yards. Seldom do we see Mark Carney pushed back on his heels as he appeared when confronted by reporters asking about recession.

Yes, to economists it may be ‘technical’ and likely revised away in then next set of numbers. But to kiddos who want to nest in a house they can’t afford, it’s real. Now a survey done for Bloomberg by my old pal Nik Nanos suggests real estate is pointing to an even more troubled future.

As we’ve chronicled here, house prices have dopped by a fifth nationally and up to a third in places like Toronto. There are huge numbers of unsold new single-family and condo units available. The assignment market is stuffed with high-rise lux units tat sellers are willing to take a 40% haircut on. Builders, developers and tradespeople are losing their shirts and their incomes. We’re just inches from the greatest plop in percentage terms in national history.

Yet it’s not enough. Not even close.

Nanos has found a majority of Canadians – 55% – want real estate to become cheaper, even when their own net worth is diminished. Among the young (18 to 44) that number rockets to 69%.

A majority of us say real estate needs to crash

Source: Bloomberg

It turns out that a majority of homeowners, as well as citizens at large, want cheaper properties. And not pre-Covid cheaper. More akin to 1990s pricing. Like, fantasy.

This, of course, is the stuff political quagmires are made of. People don’t care how many trade deals Carney writes with Denmark or Laos or even if the CUSMA deal gets renewed. They just want to be able to buy real estate at four or five times their annual household income.

In Vancouver these days it takes almost 90% of a family’s earnings to carry the average home. In Toronto it’s 63% of income (which is higher). Those are unsustainable and unachievable numbers for most folks. When the stress of daily life – the threat of AI plus the disturbing news of war, grift and cruelty – are added in, everything looks negative.

For the young, thin on experience, 3% inflation seems outrageous and mortgage rates extreme. They believe Boomers were gifted everything, making a short trip to outrage. This is fertile ground for political polarization. no wonder other surveys show a third of young adults think capitalism has failed and an equal number would welcome socialism or authoritarianism.

So, yeah, it’s all about real estate. This asset class has the power to overthrow governments, poison economic systems and pit one gen against the next.

Trudeau didn’t get it. Carney better.

About the picture: “Good news!” writes Ann.  “After his last romantic liaison went so terribly wrong, Chip, ever the stud, has now found a new, equally beautiful black bitch, Luna, who is also a more loyal breed. When the house servants are on vacation, they get to cohabitate together. Although things didn’t work out for a Chip on your  dating site  blog, Chip always appreciates your good advice. New pictures attached – this one is x-rated.”

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2026/06/02/troubled/