Hello, and good morning, good afternoon, depending on what part of the country you're joining
us from and how recently you woke up.
My name is Richard Bonn.
I am our creative producer here at Keyspire.
You longtime viewers of our program will recognize me as the guy in the background, typically
the secondary host in these shenanigans.
But today we have what I would call a very special episode.
Let me just go back to that slide, and then I will entertain you by walking and chewing
gum.
Again, no, that was a joke.
I will sit right here and keep talking to you.
So we are talking about the Canadian election and how the Canadian election might invest
you as real estate investors.
And to do that, I've assembled a panel.
One of the people on my panel would be Jason Whitsall, our typical Inner Circle Live primary
host.
But because Jason is a Keyspire success coach and a realtor and somebody with a background
in journalism, I thought it was more valuable to have me asking the stupid questions and
him giving the smart answers.
So welcome, Jason.
And then also...
Now you've set an expectation, Richard, by the way, smart answers.
Well, we have people smarter than you here as well.
One of them would be Harris Newman, who comes to us from...
I'm going to say EZ Mortgage Solutions, Harris.
I know it's supposed to be pronounced easy, but this is Canada.
It's EZ Mortgage Solutions.
He's guided our members through the complexities of lending, providing exceptional care and
service with a specialization in both residential and commercial lending.
And we've brought him in to sort of be our money guy today.
And then we also have Kyle Hampson, who is a lawyer and partner at McKenzie Lake.
He has had a relationship with Keyspire for over a decade, providing exceptional service
to our members, as well as expert insight at our summits.
So we've got our coach, we've got our lawyer, we've got our broker, we've got our bald guy
who used to work in television news and feels that somehow qualifies him to host a roundtable
discussion show.
And then, of course, we have all of you.
So this is going to be a discussion between all of us.
As many of you probably know, the election was only Monday, and we didn't actually know
the full final results until yesterday, which I have to say I've never, never really seen
that before.
A lot of races very tight.
And that means that we have a lot of, we don't know what's going to happen exactly.
What we're going to do is base this around what we have been told is going to happen
largely through the liberal platform.
So starting this off, I have a multiple question for you as the audience, largely rhetorical.
But it is, how does the new Canadian government impact your real estate investing plan?
Answers could include, it depends.
I don't know.
What's your plan?
Your plan should be longer than any one government's term.
I'm an office, and you should make adjustments as needed so the numbers work.
Could be any of the above, could be all of the above, or maybe it's time to move to the
Cayman Islands.
And I say that because it's a lovely tropical place and a good place for offshore banking
So you could substitute that for any other country of your choosing.
I'm not the boss of you.
And as I attempt to switch sides, so what are we doing today?
I've reviewed the liberal election platform.
I've highlighted several options that may be of interest to real estate investors.
These have been ranked through Jason and I so that we cover what we think are the most
relevant first, as we're likely not going to have time for them all.
And then at any point, I would encourage you all to ask questions as well.
Now because I'm in the host seat and Jason's on the panel seat, we might not be having
our eyes on the chat.
So like any true broadcast call-in show, you can come on camera, open up your microphone
and ask your question.
I do ask that you use the raise a hand feature just so that we're not talking over each other
and I can go, oh, your name here has a question and then we can bring you on and do this in
an orderly manner.
So let's first hear.
from our panel, Jason, Kyle, and Harris.
And my first question for all of you would be,
what are you most excited about with this outcome?
And excited can be positive, it can be anxious,
it can be a lot of things.
And I think I'm gonna pick on Harris first.
Talk to the money guy first, wow.
Yeah.
All right.
Thanks Richard for having me, this is exciting.
No pun intended, I can talk about this
for the first question.
I think for me, what's most exciting with the outcome
is we've actually got some understanding
about where are we going now.
I mean, there's been a lot of noise in there,
like, is it gonna be the Liberals, is it gonna be the PCs?
Who's gonna retain office at the end of this?
And so I think, you know, good, bad, or ugly,
we now have a decision made by the country.
Although very close to a majority,
about three or four chairs short of that.
But I think this will, I think, allow us
to start to put distractions behind us,
which does have an adverse effect on the market.
And that's what we've been seeing,
like, especially in the mortgage space,
where we've got like fixed term rates moving upwards
as opposed to downwards.
And that's for a variety of reasons.
Part of it was the election,
part of it's obviously stuff going on, you know,
on our other side of the border there
with our Trump and Tara friend.
And for me, I think what is also exciting
is really starting to see how this will impact
Bank of Canada, like, will we start to see rates
start to decrease now going forward?
And is that enough to now get us to that next level?
And will we see the bond market start to settle down a bit
now that we've got some decisions made?
So it's probably a good starting point, I think.
All right, and then same question over to you, Kyle Hampson.
Yeah, I'd really echo a lot of what Harris said.
Now that we sort of have a position to move forward from,
it will really be interesting to see how we move forward.
Obviously, the next step is gonna be a throne speech
from Mark Carney and tabling a budget.
When does parliament get recalled?
And do we actually start to see some of the platform
of the Liberal Party that they put forward
start to take shape and move forward
and how they will need to amend it
if they stick with this minority?
Who will they be partnering with?
Will it be the NDP that would be enough
to get them across into a majority?
Would they appease some of the block members?
22 seats there, that's enough.
And will the Conservatives actually move forward with them
on anything that really does make sense
from a fiscal responsibility position?
Because that was what they were pushing
and what they were exposing during the entire campaign.
Right.
So I think at this point, we'll wait to see
what the next steps are gonna be.
Unfortunately, we now have a place to move forward from,
like I mentioned earlier,
but we still don't know in what directions
we're gonna be going and which ones first.
Right.
And then Jason Witzel, what are you most excited about?
I'll echo some of both of what they've said.
I think what I'm looking forward to
is stability moving forward,
especially when it comes to
the market interest rates inflation.
The second thing I'd like to see is how they build upon
some of the policies that they've already introduced
and more so policies that they introduced
and now see that need an adjustment.
For example, immigration policy
that they already have adjustment.
I'd like to see other policies
when it comes to housing adjusted as well
and see what kind of other new policies
that they're gonna introduce.
PolyEv won't get his way, obviously.
They won't be called back this summer like he wanted to,
but we'll see, like Kyle said,
what happens as far as getting the support
to get some of these policies over the line.
They're definitely, if you look at all three platforms,
they do share quite a common thread
when it comes to housing policies.
And I think they can eventually agree on most of those,
but it'll be interesting to see who they get
to push some of those other policies over the line.
Well, and I love that you use the word policies so much
because we did not rehearse that at all.
Jason and I sit right next to each other
and have been preparing the show for,
well, we tried to do it last week.
And then honestly, we had four probable outcomes
for Tuesday morning and we had none of them
because we didn't know who won.
But at any rate, let's talk about the liberal platforms.
And these are things that when I.
I looked through the site, made me go, hmm.
To those of you who are younger than Gen X,
you might not get the reference, but that's OK.
You use slang that I don't know.
All right, so first one is on building homes.
And I've got a secondary slide on this
because there's a few things.
But these, in quotation marks, are literally
copy and pasted right off the liberal platform
from their website.
So they said they're about giving your government back
into business of building homes and doubling
the pace of construction over the next decade
to almost 500,000 new homes.
Did I say that right?
I always get those zeros confused.
A year, well, reducing charges and new home construction
costs, reducing the cost of new homes by tens of thousands
of dollars.
And that wasn't, nobody was really saying
we shouldn't build homes.
Some of the more specific things they were getting into
was to create this Build Canada Homes business government
branch, where they will, one, act as a developer.
They've got $25 billion in financing
to innovative prefabricated home builders,
much like our friends at Packed Homes,
one of our community sponsors.
And then we've got $10 billion in low-cost financing
for capital and homes, sorry, in capital for homes
that support middle and low-income Canadians.
This will include housing for students, seniors,
veterans, and people with disabilities,
indigenous housing, shelters, and more.
So some of these I look at and see us
as real estate investors.
Students, that's definitely how Scott McGillivray
and Michael Cerasini got started in investing, servicing.
So I'm thinking there might be something
in these things for us.
And I'm gonna throw this one to Jason Witzel first
as our key spire coach.
What is your take on these various policy proposals
they had?
Well, you know, I think like any of their policy,
it's in the right place.
It's implementation and maybe aggressive in nature
and ambitious is the word I was looking for.
So it makes sense on paper, but in reality,
we'll see I'm skeptically optimistic.
Yeah.
That's what I'd say.
Do any of you think that, so for example,
if the government is going to now be builders
and they're gonna be building all these homes
on public land, and any of you can jump in here
and take this one, is this going to create
more competition for us, or is this going
to create opportunities for us as investors?
I might jump in on that first.
Please do.
I have a number of clients, builders and developers
who have acquired surplus lands
from various levels of government.
In my personal opinion, that is the better way
to move forward.
The government often, when they conveyed these lands,
these surplus lands to builders and developers,
they put restrictions on them.
They put monitoring conditions on them.
And if they're not developed or constructed
within a certain time period, the government
can purchase them back at a discounted rate.
And in my opinion, that protects the government interest,
protects the public interest, but also allows the builders
who have the expertise and the manpower to do it,
not burdened by administrative oversight,
by levels of government.
I think in the long run, that's going to lead
to faster produced, lower cost products,
as opposed to having the government become a builder,
something that they haven't done since World War II.
So I think that would probably be the better way
of moving forward.
I don't think a government administrative oversight role
will lead to faster built homes or cheaper homes.
And then Harris, your take, and I'm especially curious
about the financing options for some of these kind of builds.
I'm thinking the prefabs and the affordable housings
and any strategies we can be looking at.
Yeah, I mean, certainly the 500,000 new homes a year
is an interesting number that they put out there.
I mean, March, March, 2025, last month,
I think new construction, we were at like 214,000.
So it'll be interesting to see if we can achieve
that target.
target of the 500,000 because anytime we can certainly put up that kind of volume, it opens
up doors for a whole bunch of things, right?
It's new immigrants to Canada opportunities, affordable housing opportunities.
So from a banking perspective, certainly you're starting to hear a lot more about ADUs, accessibility
units that are being added onto properties right now.
So that's starting to get some buzz.
There are definitely new programs for new immigrants coming to the country.
So again, opportunities to get other people from an affordable housing perspective into
the market that otherwise hasn't been there.
We're all starting to hear things about rent to own, right?
I mean, again, there's that rent to own concept, which is another strategy that's out there
that is not perhaps taken advantage of enough, but there are certainly key spire investors
that have certainly sort of played in that space before.
And rent to own, also known as lease to own.
We use that term a lot as well.
For sure.
So yeah, I mean, I think aggressive target of 500,000 homes, which is amazing and back
to sort of what Kyle and Jason have already echoed.
Certainly I'm not sure getting the government into the building division now is probably
the best way.
We already have trouble with red tape in the government.
So this could slow things down a little bit with having too many cooks in the kitchen.
But I think certainly from a competitive standpoint, I think it certainly adds a tremendous
amount of value, as Kyle was alluding to with the number of builders he deals with.
So I think creating certainly that as an opportunity will be very helpful from a product perspective
and certainly more affordable.
All right.
And then let's see what I've got on this next slide.
All right.
So this was another thing that they had put up as a proposal.
And this was the first time I'd actually heard the term MIRB, which I really love.
It's fun to say MIRB.
I invite you all to let that let that term just escape your lips in this conversation.
But he said they will reintroduce a tax incentive for home builders known as the multiunit rental
building MIRB, which in the 1970s spurred tens of thousands of rental housing units
across the country.
Now I was alive in the 70s.
I was too young to know anything about the MIRB policy.
Did a little bit of reading up on it.
Found a CBC article from 2023 when CMHC was looking at it, said the MIRB scheme allowed
investors to claim depreciation and certain other costs of an apartment building against
unrelated income.
It was credited with encouraging the construction of 195,000 units at the cost of 24 billion
in foregone taxes.
So and that was repealed in 1982.
So they're looking at bringing back some form of that, which honestly, I think from a cash
flow perspective sounds like a good thing.
But what is your take on it?
Let's start with Harris as our money guy.
Certainly anytime we can get rentals and certainly it depends on if there's going to be restrictions
on is it based on affordable or does the ownership have the opportunities on what they're setting
as rents?
Obviously reasonable enough within jurisdictions across the country.
But I think certainly anytime you're starting to see a lot more clients within the key spire
looking at land development opportunities and opportunities on how to capitalize on
land that they're sitting on, I'm hearing more and more conversations around that space
at the moment.
So I think certainly if you've got land that you are sitting on that you can certainly
build a multi-unit residential building on and create housing, I think there's a great
opportunity here for clients to certainly capitalize on.
And then Kyle, what is your take on the proposed MIRB policy?
Well, I think it's good.
I think one of the biggest things that they need to fix first are the building and zoning
requirements that you have.
I know here in Ontario at the last election, it was sort of floated around that there would
be deemed building and zoning approval for multi-residential units up to a certain number
of buildings that are a certain number of units within a building.
That hasn't come to pass.
So you can throw these tax incentives out there, but unless you fix the practical issue
of getting local municipalities to approve re-designating, re-zoning parcels of land
for multi-unit residential buildings along major through-fairs within a city would make
the most sense.
But you're going to have...
you're gonna have practical issues so you can have the tax incentives for
those that get approved but you're not actually gonna see tens of thousands of
rental housing units being created unless that building and zoning issues
can get rectified at a municipal level. But jurisdictionally that is
municipal as well so my take on it would that this would be just the
federal government trying to pump things up on the demand side no? They can
they can try yeah but it's a cart before the horse. Right, and Jason I
know you want to say the word MIRB. It's a good word I think Chris almost Brooks
you just had a comment there sums it up best this is you know a way that you're
putting more more money in the pocket as a tax incentive and someone who's
like they said probably already wealthy and I'll agree with Kyle I think
honestly to fix the biggest issue it's it's multi-tiered but the biggest what I
see is the biggest reason we're in this in the first place is in municipalities
and the red tape and the lack of permits that's happened over time so and a lot
of it was because of even how we how we vote municipal councillors and such into
into power and it's you know it's the whole not in my backyard thing right so
development comes up and it's it's not my backyard you know you hear their
constituents say I don't want this and even though it's it's for the better
good you know well down the road of even some of these voters who will be even
around right even alive so it's municipalities that need to for me most
of the changes need to come at the municipal level and if that means at the
federal level forcing them I think that's what needs to be done so you got
into an interesting point about the NIMBY ism that can happen especially at
a local level and I'm suddenly thinking of this argument that I have with my
parents a lot coming from the key spire perspective and there are they would
complain like oh they're gonna you know put an apartment building in the
neighborhood or you know there's townhouses on the other side of the
street and what's that gonna do for our property values but I can't help but
notice that any everyone's property values regardless keeps going up and if
nothing else I would think like look at the GTA you know if you have a single
family home sitting in amongst three condo buildings that you know the that's
still a multi-million dollar property there right like it's not really that
that whole perception of a property values decreasing because of what's
going on in the neighborhood isn't so much a thing or have any of you found
that it that I'm wrong no yeah exactly property values aren't gonna decrease
but it may take away their son in their backyard so yes I do see Rosario just
most recent comment said that nobody wants an apartment building besides
their nice home in the the nice subs and true but think of it as an opportunity
to build in strength in a community not a you know a loss because you have to
anyway Richard you're also seeing just a I don't I guess you're seeing not in
while it's not a mer but it's multi-unit residential you are seeing a lot of that
popping up in the country now too right well through the CMHC programs so there
are back to your question earlier there are programs available whereby you're
starting to see a number of key spire clients take advantage especially in
their you know pockets like Alberta for example you know they're buying you know
six playo to two triplex or six doors or eight doors and they're getting some
great deep discounted rates and at the same time lower down payment so from an
investment standpoint certainly good or opportunities for our clients to think
about yeah and I'm seeing that I'm my comments are getting some strong
reaction in the in the chats about yeah a lot of a lot of why we get the
resistance parking potential for crime we have lots of land for spaces so you
know there's there's yeah there can be justifiable reasons for not not wanting
things other than simply property values let's let's ignore and that's what
makes politics difficult is that everyone has a perspective and no one's
perspective is more right or you know better than another person's it's just
you've got a everyone's kind of fighting for their own their own needs and
interests and compromises are you know I think good government is when everyone's
a little bit
and unhappy.
But anyway, another thing they had proposed, GST cuts.
However, that's not for all of us buying our goods
and services.
It is for first-time homebuyers.
So it looks like for first-time homebuyers,
they're going to have up to, yeah,
for houses up to $1 million in value,
could save up to $50,000.
And in recognition that home costs are well above $1 million,
they're also going to have some level unspecified of cuts
on ones between $1 million and $1.5 million.
So I think we're still looking at single-family homes.
I don't see this being an investor policy.
But my job is to ask the dumb questions,
and your job is to give me the smart answers.
Let's start with Kyle this time.
This is a pretty easy thing for the federal government
to implement.
They already have first-time homebuyer credits.
Provinces have them for land transfer tax.
Those provinces that have land transfer tax
rebates for first-time homebuyers.
So that's pretty straightforward.
I mean, if a first-time homebuyer
is buying a house over $1 million, good for them.
Whether they need any additional rebate off of that,
I can see someone in the chat just said,
most first-time homebuyers can't afford new bills.
I would agree with that to a certain point.
I mean, there certainly are townhomes and condos
in smaller markets, not in big cities,
where that could be a real good chunk of savings.
So that's a pretty easy thing to move forward with,
as long as we put it in a process,
or as long as the federal government puts it in a process
where, whereas first-time homebuyers may save money,
it's not something that could then be more directed
to the builders in terms of increasing their price.
I can see Jason nodding along with that.
So, you know, that's a pretty low-hanging fruit one
for the federal government to implement.
It shouldn't really be that hard.
Those would be my thoughts on that.
All right, and I'll give Jason an opportunity
to also nod with his voice and not just his head.
How are you feeling about this, Jason?
It's a giant nodding head, isn't it?
Yeah, my sentiments exactly is,
who is the end-user benefit going to?
And if this is something that, you know,
a way for builders just to pocket more
or pass off the cost to the end-user, the buyer,
then this doesn't solve really anything.
So again, in theory, I like it,
but I don't want to see it, you know,
passed along to the buyer through the builder
by just adding up, you know,
that 50,000 back on the cost of a home.
Up to a million is pretty funny,
and I think Mayor Harris will agree with me,
is, you know, the amount of income required for 1 million
is what, a couple hundred thousand between two people?
So, you know, when we think about the profile
of a first-time buyer, that's certainly changed,
and that's why home ownership is out of reach
for so many younger professionals starting out, right?
Where it's a, like Kyle said,
it's a condo that they're starting out with.
So does the person that's buying that million dollar
need that 50,000?
No.
So you gotta see where, you know,
who is this really helping,
and it's not one, like Kyle said, it's an easy one,
but it's not gonna make a dent,
what I see what the overlying issue is, right?
I have a thought that this might be an advantage
for some maybe also first-time investors
who might not own their own home.
Maybe they've been renting,
and that's how they've been saving their money.
I don't know the fine print on this,
but I don't think we're gonna get that right away,
because as I said off the top of the show,
I want, you know, this to be a conversation with all of us,
inviting you to use the raise a hand feature on Zoom,
and say you want to ask a question or make a comment,
and Rosaria has done just that.
So the floor is yours, Rosaria.
The housing problem here in Canada
is bigger than just not enough homes.
And it's not just in Ontario.
Can you guys hear me?
Yes, yes, we can.
It's not just in Ontario
who has the stupidest laws for landlords.
And I've actually been logging the government.
and becoming a pain in their backside,
but they're not doing anything.
The problem is, like I have three kids.
Number one, they can't get a job.
So one, we have people who can't get a job.
Nobody can live on minimum wage.
You can't afford a down payment on minimum wage.
You're gonna be living with mom and pop till you're 40.
So the house prices are too high.
Building more houses and creating like a 15 minute city,
which everybody's talking about,
is not the answer either.
I don't know what the solution is.
The government cannot build homes.
They can't even get the Eglinton LRT up and running
in what, 20 years now, 15 years?
The government is useless at getting anything done.
The private sector doesn't wanna invest in rentals
because our laws quite frankly suck.
Nobody wants to be a landlord, especially in Ontario.
Well, I would challenge you that we at Key Spire
are largely landlords and I think that there's a good
community of us to lead the way on that.
Yeah, no, I understand that.
I mean, there's good and bad.
We don't have, like we are lucky we've had
really good tenants and we've had some problem tenants.
But until a system is put in place
where we can bring the house prices down
by building houses.
And I'm not talking about putting more houses
in City of Toronto.
Like we've got tons of land north of the city
and I'm not, you know,
but now they're going over the farmland.
Like I'm here in Aurora and Newmarket, King City area
and our farmlands are getting bought up by developers
to build condos, nobody's buying a condo.
Are they building rentals?
No, they're not building a rent.
They're building condos
because nobody wants to buy a rental building.
I don't know what the answer is,
but these tiny homes is just gonna put money
in Mark Carney's pocket because apparently he owns
a company that makes tiny homes.
So I don't know what the answer is here,
but trying to build more homes in subdivisions
isn't going to work like large apartment buildings.
I already don't have any sunlight in my backyard
and that's because our neighbors decided
to put these ridiculous tall trees in there.
But I don't know.
I think trying to say that the government
is going to do this and the government is going to do that
is not the answer.
We cannot rely on the government to fix anything.
This is why we're in trouble
is because everybody relies on the government
and they just make a mess of everything.
So that's my two cents worth.
Yeah, so I think I'm going to get some commentary
on our panels on that.
I wanna throw this over to Kyle
to address some of these issues.
Yeah.
Well, there's a whole host of points in there.
Certainly I empathize with the Ontario landlord laws.
They are very pro-tenant.
They are certainly far more pro-tenant
than other provinces in the country.
Given that the conservative government
is in power in Ontario,
if changes were going to be made to it,
especially with them having a majority,
I would have thought changes would have been made already.
So I wouldn't expect that happening anytime soon.
In terms of developing lands,
a large number of lands are protected
by environmental areas and Greenbelt in Ontario.
And I'm sure other provinces
have a lot of similar aspects in there.
And so as you saw, again,
I know there's people from all over the country,
but I'm far more informed
with what's happening in Ontario.
You saw that there was some movement
towards developing those lands
and it was quickly backtracked.
So again, I don't see that happening anytime soon.
I do agree that significant changes
or tipping points need to happen in the Canadian economy
for younger people to be able to become more employed
and be in a position to purchase homes.
But that's also very much a worldwide thing
with real estate property going up in value.
wage levels across the country or across the world,
not increasing at the same rates.
I don't know what the answer is to it.
If I did, I'm sure I would be not just a lawyer here,
I would be doing a lot of other things.
They are real problems.
We can't disagree with anything that was said.
Those are all issues in terms of not disagreeing
with those points brought up.
They are real.
And I think part of the issue is,
and I'm seeing some people say,
there's a lot of jobs in other parts of the country.
And perhaps people do need to relocate to certain areas.
And perhaps people do need to,
get jobs in other areas for now
and then move into their chosen field.
That's pretty much all I could say on any of those points.
No, I think it's well said.
I do wanna kind of move,
cause we have a lot to talk about.
And the other thing is that,
as noted by these election results,
these were tight races in everything.
And the numbers are very close,
both in the actual results
and in the individual writings in the contests.
And there's a lot of hard feelings on either side.
And I'd like to kind of keep this discussion
focused on the real estate and the tactics
and what to do and what advantages are there for us
within the Keyspire community
and as being investors who create housing
and places to live.
Now we do have another hand up from Connie Hall Saunders.
So I'd like to welcome you to the show, Connie.
Connie, I can't hear you.
I think you're still on mute.
Yep, thank you.
Thank you.
Richard, I'm not used to seeing you
without your fancy hat on.
I do have it there,
but I felt the bald made me look distinguished
and authoritative today.
I absolutely agree.
It certainly does.
I just wanted to share a couple of personal experiences,
both on the new home,
the new or the building homes, if you will,
slide in all of the information that contributed to that.
More recently, after two and a half months,
I pulled my mother out of the hospital
that she was getting sicker in and not better.
And with respect to where she was going to live
because she couldn't be by herself,
one of the options that I explored
was putting an ADU in our backyard.
We're sitting on an acre and it's a rectangular lot
and one very small corner of that acre
sits on the Oak Ridges Marine.
But the other three quarters of it or more,
absolutely do not.
There are houses beside us and a subdivision behind us.
Unfortunately, I was rejected
after three certain departments in the town of Caledon
that it was not going to be possible
that because of that one little parcel,
postage stamp sized parcel on my land
was sitting on the Marine.
It was more recently rolling up
under the Greenbelt rules and regulations
and debacles of everything where that's concerned.
And that this actually is not forecasted in Caledon
to be even looked at or accepted within the next 10 years.
So while we're saying that the government is looking at
increasing ADUs or tiny homes or what have you,
there are still a lot of, as I saw in the chat,
rules and regulations and red tape with respect to that.
Flipping over to new builds and homes
and the $500,000 number, Richard,
that you had in your slide there.
Yes.
More recently, we're just coming out
of a CMHC-MLI project in Newfoundland
in which we were able to purchase homes side by each,
as long as they were contiguously beside each other,
we were able to actually purchase three apartment homes,
which equaled to 12 units.
Halfway through our project, CMHC changed their rules
and we're not permitting that any longer,
which didn't affect us, fortunately,
because we were in the hopper sooner than that rule changed.
So they had to finish ours out.
However, we love to be boots on the ground.
So walking around into new subdivisions
was actually a real eye-opener with respect to targets.
No problem.
And projections, Newfoundland being that they're-
EDA pick up?
Somebody needs a-
Yeah, sorry, we're just getting that taken care of.
There you go, continue.
Thank you, thank you, yes.
That they're actually forecasting a supply gap of-
4000 homes by 2028. And from the horse's mouth, we walked into a
subdivision where we, you know, really had hoped this could be
our next project. And that builder, sadly, said that he was
actually closing his building because his building company,
because there is such a shortage of skilled trades there, that
the few builders that are continuing have poached the
skills from the smaller guys. And that's that's not helping in
the sense that, you know, nobody can be there are barriers to
entry for anybody that wants to do that. And the skills just
don't exist. Back to the hospital, an injured construction
worker, and I were having a chat, who said to me, that since
this inception of the race to new builds, and the government's
financial incentives and whatnot, he has had the ability
to walk from job site to job site with his construction boots
in hand and take cash paid positions without ever writing a
resume ever signing a contract. And builders are that desperate
to get skilled trades in and that's here in Ontario. Sadly,
he's now in a hospital injured as a result of this career path
he's chosen and is not protected from a health perspective. But
that's that's sort of, in my opinion, where the government
easy to write a number and put it to paper and put it on a
slide. But what are the supporting plans that are going
to help our country meet those goals? Because as it sits today,
it doesn't feel like anybody's really paying attention or down
in the weeds where where work needs to be done.
Connie makes a good point. And they did address it a little
bit. I think it's further in your slides, though. You're
right. Construction and trades are definitely something that
needs to be addressed. And I said it before it needs to come
to the forefront because the the plan is great. But the
execution if we don't have the people, it's just not going to
happen. So there definitely needs to be more funding into
and they've started some of that. But there needs to be a
bigger push on that end.
Yeah, a plan a plan associated. Yes. Thank you.
Connie's banged on the MLA and the CMHC MLA. So it's not alone.
We were working on a structure deal as well was in Alberta at
the time. And again, the rules change partway through. So you
think you're going down this path of I can either do energy
efficiency or whatever the case is, or you know, in my case, we
had a client buying exactly like you side by side houses. And
they were two triplexes. So a six door unit property. And in
early this year, CMHC came out and changed the rules again. So
like you could be stuck sort of in the middle of a process like
the clients were working on energy efficiency. We need to
pivot last minute in the middle of the CMHC process and take
them through affordability. So we got lucky. And to Connie's
point, Connie's got lucky as well. We were able to get
through the finish line with the low down payment and the extended
am but these are things we need to always make sure that we've
got, you know, the rule CMHC is an interesting governing body,
right? The rules can change on the fly, like we've seen in
other cases.
Agreed, agreed.
And you just got to make sure that you're protected enough
where you've got enough excess down payment that if God forbid
something changes midstream, and you're in the queue, or waiting
to get your number called to the deli counter. And, you know,
you're, you don't know where you're going to be on some of
these things. So just got to got to really think through
strategies. And but they're tremendous opportunities to
certainly if you can take advantage of them.
For sure. Yes.
Right. Thank you for that, Connie. And to our panel, I
want to be mindful of time because we've got about 15
minutes left till 1pm here in Ontario where we where we're
broadcasting from. I know that we're some of you are going to
be on lunch break, some of us have meetings and stuff
afterwards. So I want to get us off on time. And I think I'll
probably only have time to get through one more issue if I'm
right, and then we'll just have to yada, yada, yada and go,
here's a whole bunch of other things to look into. But I see
Brandon has a hand up as well. So I want to if you can be
quick and direct about your your questions or comments, but
we'll certainly take Brandon.
Quick and direct. Okay. I guess the simplest thing I just my
point of view on on everything is, you know, I'm not somebody
who's in a position to influence what the rules are of the game.
So my focus has always been to figure out how to win the game
with the rules that are in place. And, you know, thinking
through strategies, and yeah, sometimes the rules can change
CMHC does their thing. But wishing the rules were
different, is not going to get
to anywhere, so just figure out what the rules are,
take advantage of the Keyspire community
and the knowledge that's available to us
and figure out how you can win within the rules
and just keep moving forward.
That is fantastic insight, Brandon.
I'm reminded of Michael Cerasini
and I believe this is within the first workshop
of our Signature Mastermind program
where he has the tool, the Control Influencer
and it's this, here are the things
that I can control or not control
and it's basically, one of them is
that you can't control the government and what it does,
but you can control your business
and how you respond to that.
So yes, thank you for that, Brandon, as well.
And I do wanna get us to our next topic
and then we'll try to see what we can do
about wrapping this up.
And mortgage policy reform.
So this one is, so basically on the website
it says that Mark Carney will make mortgage payments
more affordable by reviewing Canada's mortgage market
with the objective to offer Canadians more options
while retaining stability in the market.
This will look at barriers to longer interest rate terms
on mortgages, which would give Canadians
more financial stability.
What does that actually mean?
And I think we're best starting off with Harris
since this is mortgages.
We're going to money guy.
What's that?
Going to money guy again.
Well, it's his bread and butter, right?
I mean, we can exclude him.
Yeah.
Yeah, it's a very interesting statement
and I would love to see how Mr. Carney
is gonna make this happen
for making mortgage payments more affordable.
It's interesting times right now.
I mean, I guess if he's gonna hang his hat
on the fact that the liberals made some changes
towards the last year
with now increasing the amount that one can borrow.
So changing the CMHC rules
so you can borrow from 1 million to 1.5 million now
sort of in that space from an option
or they've taken amortization from 25 years to 30 years.
Like that is an improvement
and certainly is allowing folks
that are taking CMHC mortgages
to be able to spread their mortgage payments
over an extra five years.
That is helping from a qualification standpoint
and from an affordability standpoint.
But right now when we see the rates on the fixed rates
which again are tied to the bond market
not to the actual Bank of Canada prime lending rates,
you're seeing those rates increasing at the moment.
And so that's where we need to start
to get some stability back into this,
get the bond market kind of calmed down
with all the noise it's been dealing with.
And then we can start to see the rates
start to come back down.
Are we getting down to 2% rates again?
That's going to make payments more affordable for everyone?
Likely not.
But I can tell you in this space,
I mean, certainly a number of economists
still feel that we're going to see the bank lending rate,
the prime lending rate that's most important to all of us
that has variable or home equity line of credits.
You know, the crystal ball reading right now
is that essentially there's still about another half a point
that we banked in for this year
where they still see prime dropping.
So when you got prime at 495 today
minus any discounts you've got,
would get down to probably 445
by the end of Q4 of this year.
And, you know, many people are certainly expecting
that they think on the June 4th meeting
might be the opportunity
where they see the next rate cut happen,
which again would help from an affordability standpoint,
from a mortgage payment perspective for all of us.
All right.
And Jason, I've got a question.
Yeah, well, my comment is going to turn
into a question for money guy.
Do you see or envision zero down coming back
for first time buyers and benefits pros cons?
Yeah, zero down.
That would be an interesting perspective.
It was there for a short period of time.
For 20 minutes, yeah.
Yeah, back in, it's hard for me even to say early 2000s.
It would have been back in around that range, exactly.
So, and I know some banks even had a cashback.
It's Bank of, Scotiabank had a cashback.
So back then-
And some banks still offer that, Jason.
There is still cashback offers that some lenders do offer.
Again, it's not to be allowed to be used
for down payment purposes,
but it can definitely be used from a closing cost campaign
or, you know, you got to buy a new fridge, new appliances.
So there are some lenders that do offer cashback promos
as part of their incentives.
So you may not get as deep a discount,
but instead you might get a 3% cashback
or a 2% cashback on closing that would assist them.
You know, you're buying a $500,000 property
with a 3% cashback.
That's not too shabby to assist
with some of the costs you've got on closing.
Yeah, it's, and I wonder, Kyle,
if you were practicing law at that time,
real estate law specifically.
In 07, 08,
Wait, do I look much older than I feel?
So no.
So-
Than the money guy?
Yeah.
I just wanted to check, Kyle.
No, you don't, I didn't.
You were probably either just in law school
or not even quite, maybe.
Just wrapping up high school.
Yeah, that's right.
No, no, obviously the job stresses aged me significantly.
So thank you, Jason.
I'll have a great time with that.
Yeah, no, I don't know.
The zero down back, like when I was a realtor at that time,
it was like, there's people that got a lot of
first-time buyers got in the market
that otherwise couldn't have,
but I'm not sure how I feel about it,
but the way that average prices have gone
and that the, you know, saving for a down payment,
I can't see it.
I don't think it would hurt.
So I don't, I'm not sure what you think here.
Yeah, I think it'd be a great option to bring back
for certainly some of our buyers that are out there
but having a zero percent down.
I mean, it's a, you know, again,
the banks would have an issue
because they're always looking for skin in the game, right?
So they want to make sure, I mean, that's where the banks,
if I'm wearing my bank hat for a moment,
they always want to know whether it's as little as 5% down
that at least there's someone's put in, you know,
X amount of dollar was 25 grand or 30 or 50 grand.
They've got skin in the game
and not as simple to walk away from something
when you've got something that you've put in,
you know, your life savings potentially,
or, you know, you saved up for years
to get to your 25, $50,000 down payment, 100,000,
that it's hard to walk away from a property
when you've got that kind of investment in there.
A zero percent down, you know,
you probably see the keys being dropped off a little easier
than if you've got a percentage into the property,
but it's an interesting and outside the box way of thinking
of opportunities on different ways to get creative.
Yeah.
All right, so I am going to now motor through
some of these things on a very,
here's a whole bunch of things
that we thought was interesting
and we do not have time to talk about,
and then I'll bring it back to wrap the show up
with what I like to get as final thoughts.
So what we didn't have time to talk about was immigration,
and it looks like we're looking to stabilize
or likely lower immigration rates.
There's a policy on that.
Inter-provincial trade,
which I wish we had time to get to that one
because I'm curious how that would affect
things like construction, home building,
that sort of thing, but they're looking to
basically take off a lot of the trade barriers.
The AI tax credit is something that I would suggest
looking out for because it is,
they said it would be aimed for
small and medium-sized businesses,
which is basically you as a real estate investor
are running a small business.
So now granted, there's the thing about
as long as it can demonstrate that they're increasing jobs,
not taking them away, but it's interesting.
It made me go, hmm, national building codes.
Another thing I really wish we had time to talk about,
maybe we'll have to do some follow-up sessions
in the future to talk about some of these things,
especially as they become clearer.
We've got home retrofits.
So basically to make your homes more energy efficient,
various programs proposed for that.
Likewise, to make your buildings more accessible,
proposed funding for that.
There would be a review of the corporate tax system,
which is probably something that makes
a lot of people nervous.
Balancing the budget by 2028, which is a long time off,
but it's interesting to note that it is
theoretically on the horizon.
Apprenticeship grants could actually be a very big deal
in the home, even just getting someone
to do your renovations could help increase that.
What do we have?
Transition bonds, that's a whole other thing.
Like I said, my recommendation, and we'll get into this
as we look into these things, flood risk insurance.
So with climate change and all these natural events things,
your insurance policies are something to look out for.
Housing acceleration, income taxes for the middle class
being brought down slightly, possibly.
Linking childcare with housing developments.
I know Jason really wanted to talk about that one.
Engaging municipalities that make progress on housing first.
I think that has something to do
with addressing the NIMBY.
issue that we talked about and building high-speed rail that connects
communities between Windsor and Quebec City would have been I don't know how
much that affects investors other than you know it's a good to invest along a
rail line and maybe commute some commuter towns would be enhanced but we
really have about four minutes left in our hour and I wanted to just get a our
general final thoughts and I think I want to start with Kyle because we
haven't asked you as much as I wanted to and I think as a lawyer you have a lot
of insight to bring us on all things government and law so Kyle what are your
final thoughts on this session you're gonna hate me for this answer but it's a
massive it depends really I count on you for that yeah no we would count on you
for that but unfortunately that's the reality these are all promises they are
not a definitive path or paths that the Liberal government will now be moving
forward with or or maybe they will but we don't know which are gonna come in
first and what is gonna happen second we don't know what's gonna happen with our
neighbors down to the south you know the tariffs are on they're off they're on
again they're off they're less they're more it it all has a massive impact on
on exactly what we're gonna be doing I think Harris and I were chatting about a
week ago or a couple weeks ago saying you know we all thought this was gonna
be a really good year all the forecasts were interest rates were gonna be going
down December looks really good in terms of the the future and then everything's
changed the Canadian election the American influence of the global economy
and all the impacts on there I think we're very much still in a wait-and-see
aspect and I would not be surprised to see the market continue to be stagnant
until there's a little bit more clarity on where things are going except for
those people that have to renew financing or have to do certain
transactions I think people who have the time are gonna use it and we're
gonna see we're gonna see a slower market then I think all of us were
hoping for this year all right thank you Kyle Harris your your final thoughts I
don't think I can top that recap there buddy all right well then maybe what do
we do about he's so much younger in us yeah I don't ramble I think I'll hit it
on the head I mean it to be frank I mean I think there's so there's still
it's a lot of what else right now so what what will be the first focus what's
gonna be the second focus how much is Trump gonna play into this how are we
gonna calm things down so you know I think you know we have some direction
now in at least Canada from that perspective but I think there's other
unknown factors right now that can still play into the excitement we'll call it
that has impacts in the market and I think that's the unknown piece right now
as to what's gonna happen in the coming months will you know Carney be able to
get the entire group together including his peers on the other sides of the
table to to get things move forward on the agendas and what will be number one
through five on the agenda as to where they start with but I think certainly you
know I think as and as investors I think we certainly got it you know look at our
you know we got to take a look at certainly surrounding ourselves with the
right people in our circles to ensure we kind of go to them for the right
guidance and certainly the the discussion points on how we can help
them move their agendas forward because you don't you're not gonna sit still in
the next year things are still gonna happen people are still gonna buy two
people still gonna refinance and people got mortgage renewals coming up so we
still need to make sure as we think about these things how do we help each
other in this community move forward and continue to build our real estate wealth
very well thank you Harris and Jason with so we're at a time for your your
last thoughts but you are going to be back with us as early as next week
hosting our next inner circle live with elite aligned coaching and then Harris's
of course if you look at this calendar here is going to be back with us on the
27th to discuss self-employed and MLI select financing so seconds of my last
thoughts Richard okay fine I want to you know what just coach us as investors
it doesn't matter the government Brandon alluded to this no other government
tampers more with mortgage laws Harris can attest this housing than the
Canadian government so it's nothing new as investors you just have to learn to
pivot and look for opportunity and take advantages
what's already there. And there are good programs available, funding available
right now that you can take an opportunity to get advantage of, and
my thoughts are there'll probably be more to come. So that's where I'll end that.
All right, well that is a wonderful final thought. So thank you all of you for
joining us on this very special episode of Inner Circle Live. Thank you for
indulging me in my lifelong fantasy of reenacting the McLaughlin Group. I don't
think I lived up to that ridiculous standard. I don't know if anyone even
gets the reference to the McLaughlin Group. It was an American program, but it
was it was well ridiculed on Saturday Night Live, so that's good. At any rate,
thank you for joining us all. I hope to see you all next week on
Inner Circle Live, and whatever you do and however you feel about the outcome
of this election, please keep your investing decisions focused on
the fundamentals and the numbers and the Keyspire community. So thank
you very much and have a great day. Thanks everyone.