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Hamilton Spectator
3 days ago
- Business
- Hamilton Spectator
Should you buy a house during a recession? The pros and cons of making a home purchase in shaky economic times
During the 2008 recession, nothing positive was said about the real estate or stock markets — everything was tanking. It was a time for conservative spending, not big purchases. But in reality, it was 'the greatest pinpoint to make a home purchase,' says Jarrod Armstrong, salesperson at real estate agency The Armstrong Team. Armstrong bought a home in the GTA during that time, against the advice of everyone. But the price was right, he says. 'There's no better time to buy than when the market is down.' And Toronto's real estate market is down. In April, GTA home sales dropped 23.3 per cent year-over-year, and prices fell by four per cent. While prices and buyer competition have declined — offering the perfect opportunity for purchasers ready to enter the market — it's brought on by Canadian consumer confidence taking a hit, with economists warning of a modest recession given the current trade uncertainty with the U.S. That's put would-be buyers on the sidelines, hoping to ride out the economic uncertainty. But they'd be missing an opportunity to buy a home, experts say. That's why it's important to understand the real estate market if you're thinking of buying a property during a potential recession. In April, the sales-to-new-listings ratio was 29 per cent, indicating that Toronto is in a buyers' market — meaning buyers have more negotiating power and less competition. 'Prices have come down and we don't have the frenzy that we had during the peak pandemic,' says GTA-based mortgage broker Mary Sialtsis. 'We don't have those crazy bidding wars.' Now buyers have the chance to see properties multiple times and can put in conditional offers such as asking for a home inspection, or additional time to attain a mortgage approval. Real estate agent Othneil Litchmore says there's 'a lot of inventory' and more to choose from, with properties sitting on the market for longer. 'Sellers should be willing to negotiate, so buyers have the opportunity to score a deal where previously there wasn't,' he says. The Bank of Canada has also dropped it's overnight lending rate seven times since June 2024, bringing its key rate to 2.75 per cent . While the central bank paused it's rate-cut cycle in April, variable interest rates (which are dictated by the central bank) are sitting around the mid-four per cent range, and fixed rates (dictated by the bond market) are sitting at around the low-four per cent range at the major banks, falling in line with the historical norm, says mortgage broker Leak Zlatkin. While some buyers may be waiting to see if the central bank drops interest rates further, this only impacts variable-rate mortgages and it's unlikely the bank will drop rates considerably, she says. Buying a property relies heavily on an individual's job and income, experts say, and job stability is key if planning to buy a home. Recession-proof jobs are often in essential services such as health care, education and public safety, with others being social work, accounting and finance. But manufacturing jobs or autoworkers are at a higher risk of layoffs due to the U.S. tariffs, and workers in those industries could face stricter mortgage requirements from lenders. 'If you're in a tariff-sensitive industry, that would be something that I would counsel my clients on and ask, 'Is now a really good time?' ' Sialtsis says. 'In those cases people should be hunkering down and tapping into the equity they already have should they be laid off.' During a market downturn, it's not the time to to flip homes or buy an investment property to make a quick buck, experts say. Renovating a home to then sell for a profit is unlikely to happen with home prices falling, Litchmore says. 'If you buy today and want to sell next year, not only will you not make any money, but you could lose some equity,' he says. If you sell the home for less than you bought it for, you're on the hook for the shortfall to the lender, which isn't a position you'd want to be in, he adds. It's important to buy a home you can live in for at least three to five years — a typical term for a mortgage — but preferably you'd want to live in the home for longer, says Zlatkin. 'You want to buy a home you'll be happy in and you have to think of what you can afford,' she says. 'If choosing a variable rate, and the interest rates go up, can you accommodate the increase in monthly mortgage payments? If not, then it's better to go with the certainty of fixed.' Prices have softened in the GTA, and while the drop hasn't been significant, it could mean that the value of your home could drop slightly from the purchase date to the closing date. A typical close is 60 days, but Sialtsis says you may want to ask for 45 days instead if you're concerned about a declining market. 'There is the risk of values dropping from buying to close,' she says. 'The lender always has the right to ask for an appraisal before close, and if the market tanks there could be an issue.' If the appraisal comes in lower than the purchase price, the borrower must make up the difference, typically putting down a bigger down payment. 'A lot depends on the individual lender and strength of the borrower,' she says. If the borrower has a sizeable down payment, the lender is more at ease with the loan because more equity is in the property. While the condo market is seeing the most noticeable price decrease, detached, semi-detached and townhome prices are remaining relatively flat, experts say. At the end of the day, speaking with a mortgage professional before looking for properties is the best way to ensure you know what mortgage you qualify for, and what you can afford to spend for monthly mortgage payments. 'There's a difference for how much you qualify for and what you can comfortably pay on a monthly basis,' Sialtsis says. 'Get your numbers sorted out beforehand.'
Hamilton Spectator
07-05-2025
- Hamilton Spectator
Six Nations Police investigate tobacco operation
A tobacco manufacturing facility was the subject of a police investigation on Six Nations of the Grand River on Wednesday. The facility was operated by 'a non-Indigenous criminal network' who don't live on the territory, Six Nations Police said in a Facebook post. 'The profits were in no way invested in or utilized by the community,' it said. The OPP Organized Crime Enforcement Bureau assisted Six Nations Police Service with the execution of the warrant, the post said. An earlier Facebook post from the police service said a section of Chiefswood Road was closed between 3rd and 4th Lines while they conducted 'a police operation' at 1342 Chiefswood Rd. It's unclear if the closure was related to the tobacco manufacturing facility investigation. The post did not say if arrests were made. In 2020, police busted an illegal tobacco facility on Six Nations in 2020 run by a GTA-based criminal organization . Police have not said if the two are connected.
Yahoo
30-03-2025
- Politics
- Yahoo
Carney campaigns in Ottawa as NDP condemns Liberal candidate's words
OTTAWA — Liberal Leader Mark Carney is in Ottawa today meeting with a local family in an event closed to media. The NDP, meanwhile, is denouncing comments made by a GTA-based Liberal candidate about a Conservative candidate who had a bounty placed on him by Hong Kong police last December. The Toronto Association for Democracy in China says in a news release that Liberal candidate Paul Chiang told a Chinese-language newspaper at a news conference three months ago that everyone at the event could claim the bounty on Conservative Joe Tay if they turned him in. Speaking in Port Moody, B.C. alongside Leader Jagmeet Singh, NDP MP Jenny Kwan condemned Chiang's words but did not explicitly call for him to step out of the race. She said Canadians need to stand together against hostile foreign governments and the NDP is the only party that takes foreign interference seriously. The Liberal party did not immediately respond to a request for comment but Chiang apologized Friday for his words, calling them "deplorable." This report by The Canadian Press was first published March 30, 2025. Alessia Passafiume, The Canadian Press
Yahoo
20-02-2025
- Business
- Yahoo
Grocers stocking up on Canadian, international suppliers as shoppers avoid American
Canadian grocers, large and small, are seeking alternatives to U.S. products ahead of a potential trade war, while highlighting homegrown products already available on their shelves. The two countries are in the midst of a truce that's set to end in early March, but grocers aren't waiting around to see what happens. 'I think this is just the new normal that we'd better get used to working with, and in some cases, 'working with' just means finding other, better long-term solutions that are reliable and stable,' said Gordon Dean, who owns and operates five grocery stores in Ontario and Quebec. Buying Canadian has always been the motto at Mike Dean Local Grocer. But the company is doubling down on what Dean calls 'Canadian content.' In the produce aisle, where Canada is particularly reliant on U.S. imports, Dean said suppliers are already diversifying. About two weeks before Trump's initial tariff announcement Feb. 1, Dean said suppliers started moving away from U.S.-sourced produce. 'They are pulling some product from areas of the world that we typically as Canadians aren't used to,' he said. 'I'm selling green grapes and red grapes on my shelf right now that are product of Namibia.' The weaker loonie has made it easier for Dean to justify the switch. He said he recently turned down several price increase requests from suppliers on U.S. products. 'We're just going to discontinue them. I'm going to find a different replacement that is domestic,' he said. Rick Rabba, the president of Toronto-area chain Rabba Fine Foods, is also thinking about what tariffs could mean for the fruits and vegetables he sells in his stores. The company has been holding meetings with primarily Ontario producers to find alternatives "because we don't know what's going to happen," he said. Though Canada is quite reliant on imported fruits and vegetables in the winter, Rabba said the domestic greenhouse sector has expanded in recent years, meaning there are more alternatives for some produce, such as lettuce, than there used to be. 'It's not that we have anything against produce from the United States. It's just that we want to make sure that our GTA-based, Canadian-based customers don't have an interruption of supply, regardless of what happens. So we always want to make sure that we're looking for alternatives,' he said. In a recent newsletter, Peter Chapman of consulting firm SKUFood said specialty grocers have been 'all over' the buy Canadian trend, as they can differentiate themselves by reacting quickly. Of the major grocers, he said Loblaw has been the most vocal. 'This is definitely an opportunity for Canadian manufacturers ... now is the time to leverage the opportunity,' he wrote. Loblaw spokeswoman Catherine Thomas said the grocer is talking with its existing vendors to source more Canadian products, as well as looking into new and alternative local vendors. It's also looking to broaden its supply chain beyond the U.S., she said in a statement: 'Where we have products historically made or grown in the U.S. with limited Canadian options, we will look for alternatives from other countries.' Loblaw is also showcasing products prepared in Canada in its stores, online and in flyers, Thomas said. Pierre St-Laurent, chief operating officer of Sobeys and Safeway owner Empire Co. Ltd., said customers are asking where products come from, and the grocer is responding with more signage and information to help them make their picks. The company has lots of flexibility in its supply chain to respond to shifts in availability or price, he said in an interview. 'If a (U.S.) supplier comes to us ... with a cost increase because of tariffs, our answer will be no,' he said. St-Laurent expects Canadian suppliers will adjust their operations to respond to growing demand. But he also thinks as time goes on, U.S. suppliers may have to make some changes. 'Some companies and some suppliers decided to concentrate their production in one country for economic reasons,' he said. 'But right now, the dynamic is changing. If they want to do business in Canada and they want to be competitive, they will have to revisit their manufacturing organization.' Metro spokeswoman Marie-Claude Bacon said the grocer will 'continue to give priority to local Canadian products whenever possible," and work hard to mitigate any price impact. Bacon said for many years Metro has prioritized and promoted local products in its stores. But in the coming weeks, the company plans to "optimize the visibility of local products" in-store, online and in flyers, she said in a statement. Dean said though shoppers are happy to substitute many different foods for an alternative, big brand names like Frito-Lay and PepsiCo are harder to swap out. 'If you look at Frito-Lay, there's tons of Canadian chip companies that could replace them, but they're such a monster in the category,' he said. There's also confusion among shoppers over what counts as Canadian, he added, as many large multinational companies have manufacturing operations in Canada. 'I own grocery stores, and I'm in the same boat,' he said. 'What counts? Like, if they're creating Canadian jobs, paying Canadian payroll, using Canadian tomatoes, that's kind of Canadian.' This report by The Canadian Press was first published Feb. 20, 2025. Companies in this story: (TSX:L, TSX:EMP.A, TSX:MRU) Rosa Saba, The Canadian Press Sign in to access your portfolio
