Hacker News Reader

Comment by cmdshiftf4 | Hacker News Reader

What do you think happens the tenants when the landlord's properties go into foreclosure?

What do you think happens mortgage lending in such a scenario?

What percentage of current renters have a 20% downpayment ready for even something as large as a 50% drop in home values? In Toronto, last I checked it as 1.1m for the average house and about 800k for a reasonable condo. How many current renters do you honestly think have $110k/$80 ready for a downpayment?

A housing market collapse only benefits those with great sums of capital on the sidelines waiting to deploy.

View on HN

> What do you think happens [to] the tenants when the landlord's properties go into foreclosure

That actually depends on where you live - here in Ontario, we have laws that give tenants the right to stay even if the landlord sells/loses the property. The new owner must allow the tenants to stay, with the same lease terms, even if the new owner is a bank.

Granted, there is a problem of someone doing an "Amazon", but these dangers can all be accounted for and cheap homes would vastly benefit the younger generation. Granted, maybe progressive taxes on property are needed, but I don't see problems.

So 1.1m for a house is probably a problem. What is the alternative to fixing that?

>cheap homes would vastly benefit the younger generation

The USA, Ireland and others have already been through housing busts in the last 10-15 years and it had no effect on home ownership.

>So 1.1m for a house is probably a problem. What is the alternative to fixing that?

Keep in mind we're talking about prices in some of the most attractive places to live in, in North America. Places that are also the target of skilled immigration and migrants with money also.

As you probably know, it might be $1m for a starter condo in NYC, but you can pick up a detached house in a decent area elsewhere for a quarter of that.

The unaffordability of the cities is a function of supply vs demand. If you want to bring down city property prices, simply reduce the need for cities.

There are plenty of megalopolises all over the world where housing values are not nearly as extreme as they are in North America. In ten minutes of searching, I found a 3 bedroom condo in Tokyo marketed to expats for $350,000. With a parking spot. And a balcony.

Is that a function of keeping up with supply by building? And if so, what does Tokyo do structurally that NA cities can't seem to get their act together to manage it? My understanding is that in Japan generally, there is more of a culture of destroying housing stock and rebuilding. I presume that leads to building with greater density if there is more turnover. And presumably, this also helps with keeping up the infrastructure expansion to support density (transit and utilities). Just a hunch, is it true?

It’s a good hunch. I think the biggest thing they do is that planning and zoning isn’t done at a local level, it’s done at a national level. So you can’t get your neighbors together to vote out your representative or throw massive amounts of effort at stymieing development. I think some of it is cultural, too. The Japanese are still dealing with the fallout of the real estate crash in 1992, the Nikkei 225 has still yet to reach the peak value from that time, and they just don’t look at real estate as an asset that will always go up in value indefinitely like we do here in the West, so there’s no political will to maintain that.

You can't fix that in Toronto. You have to build more but the population of Toronto is growing significantly so even if you do it won't fix the issue. If you save $100k the monthly $5500 mortgage won't get paid with the salaries. Two big things that are being discussed by citizen's are restrictions for purchasing by a non citizen and limits on Airbnb renting.

Reply on news.ycombinator.com