this post was submitted on 14 Jun 2024
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I don't get the rich getting richer in the title, how does owning a home (for the vast majority of people, on a mortgage) make someone rich? About 65% of the Canadian population are homeowners. 65% of the population owning 90% of the wealth isn't that surprising or that wrong. What's truly wrong is numbers like 1% of the population owning 30% of the total wealth in the US.
It's always the homeowner boogeyman when in reality the problem comes from the government spending money wherever and not applying strict foreign home purchasing laws that keep increasing home prices. People who own one or two houses are not rich and are very unlikely to drive a Porsche, and even there, if it is an individual who owns that property, that person will have to pay their fair share of taxes on their income and property taxes.
Imagine paying over $1000 for rent every month, except that if you decide to move, you (theoretically) get that money back, and (likely) even more.
Now imagine that same $1000 going to someone else and you never see it again.
1000$ in rent! Where are you living that is so cheap?
Yeah I did go a bit low. My actual rent is more than that.
One of these days, a banana is actually going to cost that, and then this joke will no longer work. Hopefully not for decades though.
A basement suite in rural Saskatchewan. I'm guessing that's about the going rate.
I don't see how that addresses what I said in my comment?
I'm not disagreeing with your comment btw. I was speaking to your question about the title.
In the eyes of a renter, homeowners are rich. It's (unfortunately) an amazing investment with a very high barrier to entry.
Funny enough, real estate preforms worse than just an index fund, usually. The difference is that a mortgage makes not regularly paying in much more difficult.
But yeah, the underclass tends to rent.
The other differences are leverage, tax sheltering, and the low cost of borrowing. How many people can borrow $1,500,000 at 5% to buy an index fund in a tax shielded account?
Also, don’t forget that you get to “invest” your rent money when you buy a home.
Real estate returns are higher.
Yeah, but the return rate for stocks over the last century has been 10% per annum. I'm not making it up, this is what an actual financial advisor will tell you about the relative performance of real estate and investing, and why one or the other might be right for you.
You shouldn't really be leveraging yourself to buy into an index fund. If you can buy a house outright that's also a better deal than a mortgage.
So you want everyone to rent?
This is StatCan's explanation of the number you're referring to:
.
While people somewhat loosely use that number for home owners I believe it a highly inaccurate phrasing of the statistic. The statistic is owner-occupied homes.
And they're the people who keep advocating for these governments. For the record I don't think you can find me ever saying that homeowners or even landlords are bad people just because of those characteristic, however it's clear our interests do not align.
The fair portion is what's up for dispute right now.
The "total number of owners" link goes here. I'm not really sure how to read what come up, though. I actually wonder if the site was bugging out.
Here's the actual exchange. Not to give them traffic, but maybe like me you want to click through to something else.
According to other people in that thread, it goes down to 30% or 40% if you don't include people who just live together with a homeowner. Honestly that doesn't change the story much for the purpose of OP, IMO.
I don't think there's many scenarios where 66.5% to 30-40% isn't a substantial difference.
Sure there is. Off the top of my head: how much you were speeding as it effects likelihood of being pulled over, salt content in your drinking water, and median daily percentage of necessary daily calories over the course of a year.
In this case, that's a substantial but not overwhelming share of the population with 90% of the wealth either way. To me personally, that seems the same. You can have a different impression and not be wrong, I guess.
Am I reading this right in that it’s a percentage of homes (dwellings) occupied by the owner compared to the percentage of people that own their home? Like if you have a family of 4 in a house and they rent out a (legal) basement suite to two individual renters, is that counted as one owner-occupied dwelling out of two dwellings on the property; (50% homeowner occupied or 100% homeowner occupied. Compared again to say having 6 people, of which one or two(is that family of 4 a couple or single parent) are homeowners.
Yes, the number is 66.5% of households in 2021 is occupied by the owner. Any phrasing regarding people is a loose interpretation of the statistic.
https://www150.statcan.gc.ca/n1/daily-quotidien/220921/mc-b001-eng.htm
It’s a poorly worded article that (intentionally or not) ends up sowing resentment between the have nots, and have nots with a family home. (As opposed the haves, with a rental portfolio, holiday home overseas, trust funds, etc)
Makes the boogeyman the people that are seen, the peers in (relative) poverty. While the actual boogeyman can hide away out of sight. Be it overseas land barons, corporate landlords, or just straight up wealthy living in their large secluded properties.
If they own two, they're definitely rich, although not big-R Rich. A house to live in and a rental is basically a retirement plan all on it's own. Even one makes me think you're in the middle class and doing okay.
Agreed.
Neither of those things have caused the housing crisis.
I have a strong feeling you're in the picture here, as a homeowner.
Edit: And neither have homeowners, to be clear. There's just physically not enough buildings, which is a problem that's being worked on.
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