Mixed Market Conditions + Should Large Companies Buy Up Homes? — Real Estate Roundtable Dec 2024

Hi, I'm Amit Desai, editor of Movesmartly.com, and this is the Movesmartly Show. Our episode today is our last monthly Toronto and Vancouver round table of the calendar year with my host, John Pesalis in Toronto and Steve Saretsky in Vancouver. In this episode, John and Steve explain why a jump up in year-over-year sales numbers in both markets is actually obscuring what is in reality a sluggish market with mixed results for different segments, some performing better than others. We also look at just how Toronto and Vancouver, Vancouver first, has come to top the list, the latest list of 25 most expensive cities in the U.S. and Canada, beating out markets like San Francisco, L.A. and New York. And then we end with a lively debate about whether Canada should allow or ban large corporations from buying up single family homes to rent them out. And we're doing this just as Canada's finance minister, Chrystia Freeland, asks for public submissions on the same. Now, it may sound like I cut Steve off at the end of this segment, just as he was getting into full flow, but I wanna reassure you that I was asked to do this by Steve to keep him strictly on time for an important client meeting. So I reassure everyone that we will pick up on Steve's points and conclude this debate in our next round table. As always, if you enjoy our show and find it informative, we'd like to ask you to leave us a positive review, to like, subscribe or share from whatever platform you are watching us on or listening to us from. Right now on our Moose Frontley YouTube channel, we are getting close to 10,000 subscribers. So if you could help us get to this number, it would be particularly appreciated. As always, we thank you for your support. And now onto the show. Hello, everyone. And welcome to our monthly round table. We are back for December, last one of the year with our panelist, Steve Seretsky in Vancouver. How are you, Steve? Doing well, yeah. Looking forward to another good show here to wrap up the year. And I look forward to the same. And John, my co-host as always, John Pesalis with Velocity in Toronto. John, how are you doing? Very good. Again, looking forward to another chat. I enjoy these monthly discussions. Hopefully all of our viewers do as well. So it feels really busy to me personally, I'm sure as both of you, as the holiday activities fill up the schedule and all the running around starts, but how does it feel from a real estate point of view? Is it busy on that front? Are you working a lot with clients or what is that like right now? Maybe Steve, we'll start with you. I mean, I feel like it's been pretty steady. I mean, it's always tough. John and I have talked about this off the air, which is you try to detract to your personal, you probably try to detach your personal business from the actual market, right? I mean, I think the challenge is you ask real, oh, how are you doing? Well, it's like everyone's business is doing a little bit differently. But if you look at the market as a whole, yeah, I think it's kind of muddling along. You look at the sales numbers. It's funny, right? Because I know the headline's gonna come out here in the next day or two and it's gonna show, oh, Vancouver home sales, up 28% year over year. I saw that, yes, yes. Yeah, the bear market is over and interest rate cuts are doing their magic and it's gonna sort of create the hopium. But when you kind of zoom out, we're still sales, we're still for the month of November, we're still below long-term 10-year averages. So we're kind of bouncing off the lows. I think clearly, yes, interest rates coming down from six down to low fours has obviously gotten people off the sidelines where activity levels and transactions are happening once again. But again, they're coming off of very low levels and I think this is a market that is really just muddling along and we'll get into it further in the show. But again, it really just depends on what you're looking to buy and or what you're selling because it's a market that's very segmented right now. And before we move off of this, Steve, I have a question for you about the Vancouver area geography. So I get separate notifications for Fraser Valley sales, Vancouver separate. So can you explain to us who are in Toronto, our Toronto region is really, really big and it encompasses suburban communities up to I'd say two hours out, right? At the extremes around, I mean, it depends on traffic, but it's, and it's all around, a big horseshoe around Toronto. So how does Vancouver work? Yeah, so it's kind of like greater Vancouver region. It's kind of confusing. It's like, if you're not in real estate, you might just call the whole region Metro Vancouver and like the Fraser Valley and greater Vancouver would be lumped into that. But in terms of like how we parse out our real estate stats, there's two real estate boards. So you have the greater Vancouver board and you have the Fraser Valley board. So the greater Vancouver board is like city of Vancouver and then basically any city that's within call it 45 minutes of that typically. So I would say almost like part of the inner city region, the Fraser Valley is the further flung out suburbs. You get places like Surrey, Langley, Abbotsford, again, further out more blue collar suburbs. Would they be considered bedroom communities? Like are most of the people driving into Vancouver for work or do they have their own sort of industry? No, I mean like, so someone from like Langley, for example, which is part of the Fraser Valley board or Surrey, I mean, quite often they're commuting from there into downtown to work, two, three, four, five times a week. You have a Metro transit system that's expanding. So, I mean, but like, yeah, if you're driving in from like Surrey or Langley, it's gonna take you an hour, which for Vancouver standards is far, right? I mean, I know in the GTA an hour commute is almost normal, but if you're commuting an hour, people think you're really far away. Okay, and how do buyers feel? Like do they, are those two markets that, in Toronto, it's interesting, people will start looking a bit North and then even start expanding their search for a house. But in Vancouver, is it different? Are those, the behavior is more like, no, I wanna stay here and I'm gonna stay in the Valley? That's a good question. So I would say this, like, I think that, of course, I think if you can afford to live in the city, I think most people wanna be in the city, but it's obviously further, it's more affordable the further out you go. What I tend to find from a real estate perspective is like whatever happens in the city where I'm located, the city tends to be the leading indicator. So whatever happens in the city will transpire in the suburbs or in the Fraser Valley, three, four, five, sometimes six months later. So it's like, if you wanna front run the Fraser Valley market, just watch what's happening in Vancouver. If Vancouver starts heating up, the Fraser Valley will heat up four or five months later. Yeah, and I was interested in the Fraser Valley latest stats show a 28% up year on year, year over year. So, but that's the same stat you're saying about the Vancouver area. Yeah, so when I, obviously for anyone listening to the show when I quote numbers, I'm always quoting the GVR, Greater Vancouver Region, which is what the news media will quote, because that's your larger real estate board. There's, I don't know, 14,000 realtors compared to say the Fraser Valley, which I think is around 7,000. Transaction volume is significantly lower in the Fraser Valley than the Greater Vancouver Region. Right, okay, but I was surprised that those numbers at least are pretty similar. And John, yeah, moving to the GTA, is that the story in the GTA, that all the regions of Toronto are roughly performing the same? Here we have Toronto, and then of course our outlying regions, Peel, Halton, other way around, Halton, Weston, Halton, Peel, York Region. Durham. Durham, and. That's it. That's it, on the East End. I mean, they're, listen, and they're always doing something slightly different, I'd say. Some pockets in the city are performing a little bit better. I mean, where I am in Leslieville, which is pretty much just east of the core, you know, like in the past month, we've had clients looking here, and you see some homes just getting like 15 offers and like ridiculous prices, you know? Like just prices that are just way crazier than you would think, especially in a slow market, you know? And our clients are like, what the hell is going on? Are we back to this crazy bidding war environment? And our general answer is no. Like the home, like these homes are the outliers, you know what I mean? You know, because for every like that one, like one or two, three, four homes that are getting all these offers, there's another 10 that have offer nights that fail or only get one offer, right? So. Even in the same area, John? In the same area. Even in the same area, exactly. So it's, again, it's like these one or two homes that come up on the market in a given week that attracts all the buyers. They're really priced low. Half the buds are not even realistic. But generally, yeah. I mean, the dynamics are very similar to what Steve said. I mean, sales technically are up for houses and for condos, but the market is still kind of sluggish. You know, we're up exactly like Steve said, off of like historic lows last year. So yeah, we're doing better from that. It's not a booming market. Inventory's still pretty high. And it generally feels like a bit of a sluggish market still. You know, again, outside of these outlier homes that are getting a lot of interest. I'm surprised to hear you say that condo sales are up from on the ground. It felt like that the condo market has come to a standstill almost. It's interesting. Yeah, they're up about, again, like two months in a row, they're up close to 30% year over year. Again, we're coming off of really weak sales volumes last year, and there's still a ton of inventory, right? And it's just sitting there and growing, no? Yeah, exactly. Well, no, it's like, yeah, it's kind of plateauing now. So it's not like it's an insane market. Just some buyers are just deciding to jump in maybe ahead of the spring again. And that's what we're seeing. Some buyers just trying to get ahead of the spring market. But it'll be interesting. Some of us are waiting to see if we'll be joining the United States as of Jan 6th, that's right. So I wonder how many people are waiting a bit on the economy given the election of Trump. I think that was in between our last round, so it happened right after. And surprisingly, he's coming out swinging for us first. Some of his toughest talks. I don't know how much to believe. Privately, someone is suggesting he told Trudeau if things don't work out with us, if he slaps the 25% tariffs and we don't make it, we can become the 53rd state, guys. There we go. Available to us. Thank you, Trump. Governor Trudeau. Yeah, so I don't know if he actually said that knowing him. I mean, sounds like you could attribute it to him and his staff wouldn't deny it. But jokes aside, Canadians are worried. Do you feel like some of your clients are saying, okay, we gotta see what happens in the new year? We know how Canadian economy will be hit by this. I think some people are a little worried. Again, like I think, you know, what's that saying about Trump? Like you take him seriously but not literally, you know what I mean? Which I think is some truth. But again, at the end of the day, I think there are some people worried about the outcome of what the new year might look like economically with their potential policy changes. I don't think much is gonna change anytime soon. If we roll back to like the last time they did this, they just renegotiated NAFTA, decided to call it, what the heck did they call it? UNSCA or something like that. Yeah, so the U.S. is first or UNSCA. You know, and not much really changed. So I don't know, I think, but I think there is still some concern among some people. I'm noticing his picks for cabinet are very different though. Very different players to the first time he was in. And I do wonder if he might do some of these opening salvos just to make a point, take it seriously. And that if Canada might be a target, because in some ways we're kind of a softer target than him pissing off other people. But Steve, what is the feeling that you're seeing in Vancouver? How seriously are people concerned? Vancouver, obviously part of a really integrated trade network, right? With the United States. I mean, I haven't really heard anything about it yet. I mean, I think obviously the media just kind of freaking out and stuff and governments are freaking out. But I don't know, I think for the average person, I don't know, I don't think people are really paying attention to that. I think they're just, you know, wondering how much money they can borrow and what the interest rate is seems to be still the topic du jour. Guess it doesn't take much. It takes a lot to rattle a Canadian, I guess. Yeah, I mean, especially in Vancouver where everyone, like real estate is like a, everyone's like favorite pastime, you know? It's all everyone, it's all anyone talks about in the city. I mean, it's, yeah, so that's been the conversation. I don't know, I mean, it's weird, like John, I think we had a nice uptick in October activity. Like, wow, the market definitely like took a shift. I don't know, I think November kind of sails a little out maybe a little bit. Like, I think it's still really hard to draw any parallels moving forward of what does 2025 look like? You know, I don't have a strong vision on that. I think it's kind of anyone's guess. I think it's, you know. Yeah, I tend to agree. Like, I think sales will be a bit busier. Like, I think year over year, but I don't know what the on the ground dynamic is like, if it's still sluggish. Like, technically now we're up year over year, but it's still a slow market, right? So it's hard to say what the new year's gonna be like. I agree with you. Actually, like, it's weird. It's like, yeah, I think the market's pretty tight for like entry-level detached or just detached in the city here. Certain pockets and price points are competitive in multiple offers. And then you go like, you know, pockets, downtown Vancouver condo market's still soft. It's been that way since COVID. So yeah, it's funny, right? It's just like, it depends. Like now, every time you're meeting a client for a listing or, okay, where is it? Like, is this thing gonna move? It feels like it's either gonna sell in 10 days or it's gonna sit for six weeks. Yeah. Interesting. All right. Well, I can't believe we're gonna be living in 2025. It's just like, we're way out in the future. What was back to the future? Like, what was that future? 2005? Oh yeah, that's a good point. You're right. All right. How are we living all the way out here? But so you're thinking more of the same from where you sit? I think we're gonna muddle along. I agree. I think everyone is so like used to like, we're either in a raging bull market or we're in like a really bad bear market. Like it's either like light switch on or light switch off. Like that seems to be like the mantra over the last eight to 10 years. And so everyone's just like, well, it's been kind of a crappy market for the last couple of years. Like the bull market's around the corner. I don't know. I think maybe we just chop sideways. You know, I mean, I continue to point this out to clients. There's like, we have segments of the market in Vancouver that have gone stagnant and stale and have not moved price-wise in six to eight years. So like, what's another three or four? You know, a lost decade. Probably not the worst thing for the overall health and affordability of the market. And so I think, I don't know. I just think like mortgage rates, Bank of Canada's gonna continue to cut, but like fixed mortgage rates on the bond market, that seems to be still chopping sideways. That, you know, I think people just have to get used to borrowing at 4.3, 4.4%. And maybe that's as good as it gets. And so if that's the case, I just think it's hard to see how you're gonna get back in the raging bull market. John, I'm curious your thoughts. I continue to get emails. I don't even live there, but I continue to get emails from people about the pre-sale market and the GTA. Oh, I've got this condo, don't know what to do. It's closing in a couple months. Can you give me some advice? I think, I mean, it seems like a real problem over there. It's a massive. I mean, everyone wanted to be a real estate investor even two years ago. And now that there's so many units scheduled to complete, and even some people who closed on them, no one wants them anymore. Like they're just not that interested. They kind of regret their purchases. And that's what I hear from, I meet with people and I'm like, I wish I didn't buy those three condos. You know what I mean? Because they're bleeding cash on them. They're not worth what they paid for them. They might be losing a little bit of money. And especially when you think we might grind, and condos have been grinding sideways since like the start of, since 2020. So like four years now, and it's probably going to continue. And I do think we're just starting to see more people think like, I don't want to be a condo investor. And I think we haven't seen that fully play out, I think, which is what's going to be interesting. But yeah, a lot of people just don't want to like, and some who can't close on the pre-con is one thing, but even people who have existing ones, don't, aren't excited about being investors these days. That's for sure. That's why I wasn't trying to like hijack the show here, but I was trying to sort of get to my point, which is I think why I feel like we're going to kind of chop sideways here. Like maybe we'll just muddle through where, yeah, some segments are hot. You see, you know, slight increases in prices here and there, but you see other segments that continue to kind of, you know, drag behind. It's because I think that the condo market, I still think is an area where, particularly in the GTA, I think Vancouver has got a little bit of problems, but you know, I think some of these people that bought these pre-sales that are closing on them, they're like, well, you know, I don't want to, I don't want to lose any money. So like I'll hold it for like a year and I'll try next year. And I'm like, yeah, but you might not be getting back to that high watermark for four, five, six, eight, nine years. I don't know how long it's going to take, but it ain't going to be a year. And I wonder before we move off of this topic, John, on that subject, especially the pre-con market, which in terms of sales is just, it's dead, you know, nobody's buying. You say interest in people, even taking the ones that are now coming onto the market or completing is dwindling. Rising completions, we know another slate of record completions is due to hit the market, right? We had a big one, a big number last year, and there's still a lot of projects that are slated to finish. In addition, our population's going to be cut by all the temporary students and other cuts to other categories. So doesn't that mean that we should see downward pressure eventually on some segment of the condo market in terms of prices? Or no, this is still going to hold and people are still going to hang on somehow. Yeah, I think we'll potentially see some combination of downward pressure, whether it's rents or prices or something. Again, like it's hard to predict because, you know, if a lot of investors want to get out of the condo market while you're kind of rental stocks kind of declining a little bit. So, but you have a lot of inventory for sale, it might push pressure on prices, right? But yeah, we do have a lot of inventory in the pipeline that's going to be completed. So we're probably going to meet some combination of softening in prices and rents. Because like I said, I did a segment on the show like last week or two weeks ago. You're right, I mean, according to the stats, if the feds say what they're going to do, if they're actually going to follow through, our population growth either going to be flat or slightly negative. But we're still completing 200 plus thousand homes per year, right? So that's obviously going to put some pressure on the market. Well, yeah, I mean, I had this conversation yesterday with the property manager, you know, big property manager in the city. And the conversation has really been around, and this is not just one property manager, but like several very well established firms that are telling me rents in Vancouver have been softening for the last six months, noticeably. Like we're talking, they're down about 10%. And this is at a time when we're told, anyways, we're told that 4.9 million immigrants are going to be asked to leave the country by the end of next year. I think they've already started leaving because like, I mean, how else do you explain rents declining by 10%? You know, the conversations they're having is like tourism is way down. The immigration side is definitely soft. I don't know, I'm curious. And I think the other question mark is we don't actually track people that exit the country. So we don't actually know how many are going to leave or how many are going to stay because the government doesn't track that. So, but yeah, I wonder if people have already been leaving, which wouldn't be surprising given the unemployment rate for new immigrants and for youth is at the highest in what, almost two decades. And rents are down. Yeah, one impact has gotta be the fact that John, some of this is disproportionately students whose visas were like, you know, that was stopped and a lot of the programming is shut. We see those knock-on effects in the GTA of, you know, all these colleges shutting programs. So I wonder how many of that population would have been part of this rental market, but you know, pressure that we were seeing in university towns and colleges towns. Yeah, I think that rental demand was more, and we talked about this, like people renting smaller homes, like, you know, international students are, for the most part, not renting $2,500 a month condos. Like some are, if you're more affluent, that segment of the international student is still there. Like they weren't cutting U of T or whatever, because U of T and all these downtown universities didn't quadruple their number of international students. It's these smaller schools that did. So yeah, those markets are gonna be hit a little bit harder, I'd say. All right, so back to, let's talk about the States a little bit in comparison to Canada. We've heard a lot that the U.S. electorate is very, very angry. Makes you wonder why the Canadians aren't more angry if we look at a stat that Steve put up recently from a real estate, is it a brokerage, Steve, where you got this affordability chart? From Wawa, which was the, what do they do, John? They're basically like a rate hub, like a large Canadian financial website, yeah. And looking at this, Steve, it's unbelievable how home affordability in 25 largest cities in the U.S. and Canada as of October, 2024, you look at Vancouver, Toronto, right at the top, terrible price to income ratio, 12.7 Vancouver, 10.7 Toronto. And that's because look at the home price, Vancouver, 842,000 average home price, gross median income, 66K. Then you see Toronto at 762,000 with a gross median income of 71K. And then sure, you've got Los Angeles at an average price point of higher, 956K, but look at their gross median income, 96K. And the story continues, San Diego, San Francisco. Now, those aren't great stories. They obviously have a very high price to income ratio. But there we are, sitting at the top of a competition that a lot of Canadians would not like to win. Maybe homeowners are okay with it. Now, I should clarify for people listening to this thing, where can you get a house in Vancouver, Toronto for that price? Firstly, okay, because I think that's what most people are gonna hear. Where can you get a house in Toronto for 700 grand or a house in Vancouver? Firstly, those prices and incomes are converted to U.S. dollars so it's not Canadian prices just to make everything equivalent. And they're basically like benchmark indexes. So they include everything. It's not the average price of a detached home. It's the average price of any home or the benchmark price, whatever you wanna call it. So that's why those numbers are still, are lower than what someone might think in terms of- Benchmark price, by the way, for a detached home in the greater Vancouver region. So not just the city of Vancouver, but the region is 2 mil, 1.997. Wow. And so a question for you guys, could you say, okay, fine, this looks insane, but Canada has a lot fewer viable cities when it comes to employment and hubs. So if we experienced a population growth of the type we just did, they would be largely cramming into Vancouver and Toronto in terms of the growth. So does that make the United States a little bit different? Cause they have so many growth spots for both employment and living hubs. Does that explain some of why we're at the top? What do you think? I mean, I think part of it, but the US didn't triple their population growth overnight and grow by 3% per year. I mean, I think that's the bigger part. I mean, yeah, they have more cities that people can move to in a period of a tight labor market in the US, that's 100%, that's one factor, but they didn't, you know, again, like we're growing by 1.3 million people per year, which I think even in absolute terms was higher than the US was growing. I think if not close to it, and they're 10 times our size. So it's not even- We're topping the GTA, like our growth was putting us into a new category. Steve? I mean, that's why, well, that's why I always tell people, like even when I go and I've gone and presented to US financial events. And so I, you know, there's so much talk about Canadian real estate. So I always kind of put up the chart of like people, like the ones that go viral, it's like comparing the home prices in Canada to the US and like they deviate significantly. It looks like insane, like what's going on in Canada. I always have to remind people, like I'm not trying to justify home prices in Canada, but like, this is like, we basically only have, there's really like that chart of Canadian home prices, like 65, 70% of that chart is just GTA and Vancouver home prices. So it's like basically taking like, show me the price chart of Seattle and New York. The problem with Canada is you only have, in my opinion, you have two large major metros and you have, sure, you can lump Calgary in there, you can lump Montreal in there, but like that's, we don't really, everybody just funnels to two cities. And same with all the immigration, like they funnel to two cities. So parts of Canada are very, very affordable. Saskatchewan's affordable, Manitoba's affordable. No, Northwest Territories is affordable, but nobody's moving there. Actually, I had, I just heard from a friend living in Yukon, the cost of living is insane. What they pay for things, I'm not sure about the dwellings, but they fly in everything. So it's actually, it's insane prices for food and clothing and stuff. But- How much is the house? Yeah, seriously. Yeah, I didn't ask. No, I mean, again, I'm not trying to- Yeah, and they didn't complain about that. So maybe that was a little bit better. Well, I think it's safe to say the whole country's suffering from an affordability crisis, whether it be housing or cost of living. And when you put the cost of living in it, it changes things, right? Like prices might be lower in Saskatchewan, but what is the average income there? Is it keeping up? So I think that's partially explains it. Now it'll be very interesting. Canada is gonna try and reduce its numbers. We're hearing the same from the United States. I've always wondered whether curbing illegal immigration could affect their home building costs. A lot of people have wondered if, and myself, I've always tried to get at some facts. How much does that part of the labor force affect how much lower their costs can be when it comes to building houses? And I did see a couple of articles saying home builders are worried in Texas, California, markets like that, that they would be hit if illegal workers or those with a status that was in the works for them to transition into permanent residency is disrupted. So that would be very interesting to see whether there's any change. Again, I think you're both right. Trump often says a lot. What they can do is gonna be a different story. Yeah, and I think that makes our markets different. I think the US definitely has a lot of people moving from Mexico to be working in their trades and kind of supporting the new housing construction. That's generally not what we have in Canada. Like a lot of non-permanent residents are students. A lot of our new population growth, permanent residents are not construction. So we do not have that quite as much as the US. Yeah, that'll be interesting. All right, and now I wanna turn our attention to a squabble you guys had on Twitter. An extra. Oh, perfect. They say X has gone toxic and you guys are what, at each other? Are you here to prove it? All right, so Steve started a tweet on, so you can't call it an X, a tweet on November 20th. There are no large corporations buying existing single family houses in Canada simply because the math doesn't work. This is a US phenomenon only. And that was in response, I guess, to our finance minister freelance launching consultations about this. This issue of the financialization, the buying of many, many homes by corporations. And John responded with all due respect to Steve. That doesn't sound toxic. He is 100% wrong. That was a bit harsh. Large corporations. I respect, we'll get into it. Large corporations are buying homes and this has been going on for years. It is less evident in Canada versus the US because the US companies are public while the Canadian corps are private, which allows them to fly below the radar. And there's a thread to follow there. So gentlemen, are you in the position? Okay, let me start because I need to clarify something before everybody goes absolutely haywire in the comments section. What I was referring to, so yes, corporations purchase single-family houses. In Vancouver, I'll give it my Vancouver example. When they buy, corporations buy single-family houses in Vancouver to basically wind up as land development sites. So yes, you'll have BOSA developments will go out there and buy five single-family houses as part of a land assembly to then redevelop into a condo building, right? Yes, corporations like REITs own multifamily apartment buildings. They own entire rental buildings. But what I was referring to is, I have not seen it in Vancouver. I mean, maybe Jon can speak to the GTA, but I have not seen like, for example, REIT, publicly traded REIT, for example, coming in like Blackstone and going and buying up swaths of single-family houses in Vancouver at $2.4 million a piece and renting them out for five grand a month. Like the math just doesn't make any sense. The cap rate on that is next to zero. So I think when people think of single-family houses competing with Joe Sixpack in the Southwest of America, yeah, Blackstone is out-competing people for resale residential single-family houses. There's like, I can't remember, what's that one REIT there that they have in the States? It's like, I can't remember the exact ticker, but their entire portfolio is just single-family houses. And those single-family houses are typically concentrated in middle America where they pick them up for $350,000 a door and rent them out for a couple grand a month. So like the math is just way different where that's been my experience. John, feel free to tell me I'm wrong, but that's what I was referring to. So, and I agree with Steve. Okay, listen, there, when we talk about corporations buying homes, I think this is part of their consultation. They don't want to ban builders who are assembling land. You know, that's not the point of this. The point is if they're gonna put restrictions on people just buying up single-family homes and renting them and not people who are redeveloping them or converting them to five flexes. So Steve's correct, I would say. They're not, no one's going out and buying houses in Vancouver. No one really is gonna buy a detached home in downtown Toronto for two, three million and rent it. It's just ridiculous. But they are, and this is the hard part. Like I said in my tweet, the differences in the US, they're publicly traded. Blackstone, Tricon, who's like a massive Canadian company was buying tens of thousands of homes in the US. The companies doing it here are smaller and they're not publicly traded, right? And 100% they're buying either condos and blocks of them from builders or they're buying low rise homes in outlying areas of Southern Ontario. Exactly what they do in the US. They're not buying in Manhattan. They're buying in smaller communities that are way more affordable. And one big company decided to announce, what are they called again? Core, I think, or something like that. They actually announced what they're doing. There are other ones that are doing it, just they don't advertise it and it's hard to find them. You gotta look up land registry. So it is going on. I mean, my bigger issue is, I mean, I think just generally it's not even like big corps. I mean, even if I have a small corp and you're buying 10 homes, I don't know if that's ideal, especially in this market. I mean, listen, it benefits people like us who can save our money through corps potentially when I have a preferential tax treatment and go out and buy houses, right? So, and I think that's the problem. I don't even think the issue is the large corps. Even like the entrepreneurial corps who are buying 10 houses. Listen, I think it's not ideal in an environment where housing is so expensive. I get why the guy or woman like me who has a corp and wants to buy their single family homes through a holding company would want to do that. They're not stupid. They're smart. A lot of entrepreneurs buy their principal residences through holding companies. It's not because they're stupid to gonna give up the tax-free capital gain. It makes more sense because if they take out of their holdco, they're gonna have to pay taxes on that. They have to pay a dividend. They're gonna have after-tax personal income buying that property. And it just makes more sense for them to buy it through a holdco. So I think my issue is not even the big billion dollar or whatever, they're not that big. I mean, I think just corps in general, it's just kind of not fair that they're competing with mom and pops receiving after-tax personal income dollars. I think that's my broader issues. I'm not totally sure. Steve, John's concerned about a Joe six-pack here in Canada. How do you respond? No, I just think it's, so here's what I think. I think like trying to police this and figure out a way to like, this guy's good, but that guy's bad. It's against, I don't see how it's ever gonna happen. I mean, I think that the reality is, it's like, how do you, like in many times, for example, you might purchase a one, let's just say you're gonna buy one rental property. In many circumstances, and then we're getting into like tax code and accounting here for everybody to enjoy. But in many cases, it makes more sense from a legal and liability perspective to purchase the home in a holding company. If your tenant slips, falls, breaks their back on a thing of ice, if you own that rental property under your personal name as well, then they can sue you for damages and take your principal residence with it. So the whole point of like the legal and tax structure is like, if you're gonna own rental properties, you know, one, two, three, 10 rental properties, is you do it through a corporation and you limit your liability. And so, John, I think the challenge is like how, like Krista Freeland thinks she's gonna be able to say, well, those corps are okay because they're gonna develop housing, but this guy's not because he's just buying it and sitting on it and providing long-term rental housing for the next 30 years. Which one, how do we say yes? How do we say no? And I'll give you one example, personal story, is I bought a single family dwelling in Calgary through my holding company, right? Because that's, I mean, I earn my income through a corporation. I'm self-employed, I don't have a pension. So I create a holding company where my investments go to grow, tax deferred. That's the benefit of being incorporated. And so you buy that house through your corporation. And now I rented the house out for about a year and a half. So people will say, well, that's bad. You know, you shouldn't do that. You know, you're competing with Joe Sixpack. But then that house was later torn down and redeveloped into four units, four brand new units. And they are still today long-term rental dwellings. So I just don't know like how Krista Freeland is gonna say, oh, well, this corporation should not be allowed to purchase housing. Like, is there a timeline on how quickly you need to develop? If there is, how do you navigate that market? So long story short is I think that my main and initial point when I sent that tweet out, it was like, there's not really, yeah, you have these like little small corps purchasing houses here and there. But I think there's such a small, I think that's a relatively drop in the bucket that like, I just don't think that's the crux of our housing woes. I think there's a lot of problems. I think, yeah, has housing become financialized? Of course it has. And I think it has in the United States even more so, but they're not dealing with the same kind of house prices that we are. So I'm just, I'm trying to figure out, I know it's easy to villainize the investor, but I- I'm not, and I think my position's not villainizing the investor. I think we need investors like you. I mean, I think you're creating housing. The whole, and that's the point. It's not about like banning every corp from buying a home. To me, that's ridiculous because yeah, you need to buy the single family home through your corp and eventually gonna redevelop it. So I don't see them banning corps entirely. Like, I don't think that's feasible. I suspect what they're trying to do is find a way, like, is there some plan or is there something that you can phase in some cause? Like, maybe they need to show that they're redeveloping it or they're in the process or phasing something. And I think that's part of what their consultation is because you're right. It'd be ridiculous to try to ban corps like yours that are building multi-unit housing. That's completely idiotic because you're right. No right-minded person is gonna buy that under their personal name to build a multiplex, right? So yeah, I agree with you. And listen, in the case of condos, there is no end game. All the condos downtown owned by corps, they're just pure tax shelters, right? So- Could I just put a rebuttal on that? Just like, again, so I wanna say a couple of things, which is like, one, I actually think like what's happening in America with like Blackstone buying up like, even like companies like Zillow. Zillow had a home flipping company. They're using computer algorithms to go buy houses and flip them. I think things like that, like going up and competing and like buying like hundreds of thousands of single family houses, I think is actually wrong. I don't agree with that. I just think it's gonna be interesting to see how America sort of polices that. There's been some early discussions because like, I just don't know like, yeah, which corps are allowed, which ones aren't. My other question on the condo side here, John, is like, there's been a strong argument made that developers need the investors to launch these condo units because how many first-time homebuyers do you know that wanna wait four and a half years for completion? Do you need the investors to play in the pre-construction market in order for them to get financing to actually build it? I don't know how that model changes. I think the problem is, to your point, I know you've talked about this and I agree, is because we've become so reliant on the investor to launch and finance these projects, which is what they do, they finance the projects, is that you start catering towards them. And so you start building small one-bedrooms, you start building micro two-bedroom suites and not building family housing. And that comes down because the whole financing model of construction development in this country's kind of, I don't know if I'd say broken, but it's challenged. And so I just don't know, like, these are the problems that we try to solve and I don't know if there's a silver bullet here. So we're gonna wrap up. I mean, I'll just say, I agree with you. I think the challenge is our whole market has been fed by investor demand, it's been priced by investor demand, but I don't agree with the narrative that we need them. Like, it's as if we're the only country in the world that's building condos. Most other countries, if you go to, have family-sized condos. Like, somehow, they've been able to build them. Like, we're not the only country in the world that is building condos. And we're making it sound like the only way to build them is if we only build 400 square foot units that are bought by investors, which is something I don't buy. There's gotta be a better way, so. And I don't think we're gonna- I mean, I agree with you. All right, that was a good, yes. I'm trying to keep you two on time. I know, I know. I need to get going, but I need to wrap this up, which is, damn, I lost my train of thought. On the investor side, so you've got the pre-construction stuff. Yeah, John, I've lost my train of thought. But you were saying- I was talking about, like, the only way is not to sell investor units. Every other country in the world built condos, and they built family-sized condos. So, anyhow. Which is, getting back to multiplex zoning, things of that nature, which I think will be good. Yeah, anyways, I had something I was gonna add. We could probably do this segment and do, like, an extra hour on it, because I think it's so fascinating. Yes, I have to get you to your place on time. No, I'm not blaming you. I'm a tip of my tongue, but I'll remember it for next- Okay, you remember it. When this goes live on Friday, we'll add your, I remember, to the comments section, like that. And we're gonna have a round two. So, sorry, everyone. Yes, I cut off Steve. I didn't do it. No, no, no, you're good, you're good. So, I can now offset some of the comments my way. I have to get Steve to his job on time. I was next- I do work. I don't just, we don't, me and John, we do a lot of YouTube, but we do work. Still have appointments. Right, okay. So, round two, I promise. Steve, you just tell us when you remember, and we'll put it in our show notes and our comments. We'll chat in the comments. Yeah, as usual to everybody. Thank you so much.