1. Dog talk

            Bow-wow. Time for a Blog Dog update on some of the sordid, lamentable and usually nauseating topics this site loves to wallow in. Pull on the hip waders. Here we go.

            Siphoned seniors, going in reverse:

            So the amount of money being sucked out of houses by old people is reaching astonishing levels. Reverse mortgage debt is just a few Cybertrucks short of $4 billion, according to the federal agency that worries about such things. The rate of growth is staggering – 26% in a year, or more than $800 million over that period. Needless to say the wrinklies have never swallowed this much debt before.

            And it’s sad. Reverse mortgages are giant money-sucking proboscises thrust into the livers of the financially illiterate, the na?ve or the unprepared. By borrowing against their equity with open-ended loans at huge rates of interest (currently well over 6%), these innocents end up owing more money every single month. The only way out is to sell the place and placate the parasite or croak and hope the kids don’t hate you too much.

            Thinking of a reverse mortgage? Then stop. Sell the house, invest and rent, or set up a simple-interest HELOC. Get your spawn to make payments as a deposit on their inheritance. Only fair.

            We told ya this was coming:

            Yesterday the topic was rain tax. The offspring of the carbon tax. And the message is simple – liquid wealth can be shifted around in the name of tax avoidance. Real estate, however, is a sitting duck. Utility costs are mounting. Rental income is being targeted. Transactional costs are ridiculous. Storm runoff, sewers, water consumption, garbage collection – all taxed as user fees abound. There are taxes for leaving a house empty. More taxes if it’s a second property. Extra levies if it’s worth a lot. And the relentless march higher of property tax.

            Poor Van owners just got shellacked with a local boost of 8.2% – four times the rate of inflation and double the average increase in family incomes. And there’s more – a 9.4% jump in the cost of service fees for water, sewage and picking up the trash. The dudes running the city have increased their budget more than 7%, to $1.6 billion. “It is about tackling the big problems that everybody wants us to tackle,” says a long-serving councillor, “getting more affordable housing, dealing with the opioid crisis, making sure we are combating climate change.” More to come. Get used to it. Or get out.

            What? Realtors lie? Who knew?

            In the Kingdom of 416, this kind of statement appears just about every month when the local real estate board releases its questionable stats: “We will likely see stronger price growth moving forward if sales growth continues to outpace listings growth, leading to more competition between home buyers.”

            Ah yes, competition. Also known as FOMO – the fear of missing out that whips young buyers into an orgiastic frenzy of desire so they pay whatever’s needed to get a home before all properties have been snapped up, and they find themselves bedded down on pizza boxes under a bridge. Have you seen those ‘Sold Over Asking!’ stickers than realtors love to slap on their signs? Pure Viagra.

            Well reality is something else. A study released this week found more than 70% of the sales in a hot area of Toronto went to buyers who paid less than asking. Yes. Less. That included detacheds as well as condos.

            What does that tell you about the market? And realtors?

            What comes after the Boomer boom. Bust.

            A moister lament is that the Boomers stole all the good jobs and houses. True, maybe, but it will come to an inevitable end as the Stones generation fades and eventually pfffts. If Canada is like America (it is) then about 60% of all the houses are currently owned by wrinklies. Real estate outfit Zillow figures Boomer aging will create havoc in the real estate market over the next two decades, potentially whacking buyers now paying peak prices.

            The estimate is that almost a third of all the homes in America will come to market – about a million per year by the end of the 2020s. Hardest hit there will be the retirement destinations like Florida and Arizona, as well as the rust belt states where the young left and parents remained. The result will be supply overwhelming demand, and falling values. The good news is houses will get affordable. The bad news is reduced equity for owners.

            How about Canada?

            Actually our Boomer population is proportionately larger than in the US. We have a higher rate of home ownership. We owe one helluva lot more in mortgage debt. Our savings rate is less. Mortgages reset more often. Our government pensions more meagre. Figure it out, kids. If you’re buying a house today from someone in slippers and a Motley Crue T-shirt, don’t.

            The rain tax

            This week the UN said greenhouses gases spew unabated, and we’ll all fry in eighty years. Global temps will spike over three degrees, and millions will become climate refugees. The economic destruction, political disruption and human misery will be legion. So why would you ever birth a child today? Action is desperately required.

            The deniers, Trumpers and pro-growth gang say the UN’s a criminal outfit full of globalists who wish to subjugate, tax, control and geld us. The climate change hoax is part of the agenda to create a one-world, borderless, pan-national reality serving the elites. Trudeau is their toady. It’s just weather. Resist.

            The debate is not going away. Meanwhile – agree or not – climate change is the dominant political issue in Ottawa and, increasingly, it’s a factor with real estate. As mentioned recently, 30-year mortgages may soon be a thing of the past in the US where they are the backbone of the housing business. Given increased storms, floods and wild fires, some regions will be deemed uninsurable. No insurance, no decades-long mortgage. No mortgage, no market. Prices topple.

            In Toronto some agents are now counseling clients away from buying properties in areas when flooding is prevalent. As the climate/weather impacts in new, more intense ways they warn valuations could be zonked. Meanwhile the federal government’s carbon tax – set to ratchet higher as the years pass – is hiking the cost of home ownership, making energy-efficient homes more valuable and eroding the sticker price of those with leaky windows or scant insulation.

            Fuel oil, natural gas, propane, electricity – all taxed now for climate change. Plastic bags, straws, burger boxes – banned. This is the age of biodegradable cutlery, anti-fossil fuels and derision if you drive Silverado. Even without truck nutz

            And now they want to tax the rain.

            Actually they already do in a number of cities, including Ottawa, Kitchener and Mississauga. Hamilton is studying the issue, because of climate change. Toronto councillors will be voting on it in mid-December.

            Rain taxes are the levies imposed on property owners according to the amount of runoff their land or roofs generate. In some places they’re called ‘stormwater fees’ but they’re really just penalties for owning real estate and a revenue grab by cities struggling with climate-related infrastructure.

            Hardest hit, as you might imagine, will be those who own parking lots, businesses or factories with large paved surfaces. “As Toronto faces more intense rainstorms and floods … stormwater pricing is the type of responsive tool our city needs to adapt to climate change,” says the Toronto Environmental Alliance. “We need to climate proof all of our existing infrastructure from the extreme weather Toronto is facing.” In order to escape or reduce the tax, owners are expected to turn asphalt into green space, re-roof in absorbent materials or create in-ground cisterns to collect and reuse rainwater. Big bucks. Big potential tax.

            Residential property owners will probably not escape this, as the rain tax is added to water or sewer bills. The more roof you have, the more you pay. The more water your property sheds into the sewer, the more tax faced.

            (One formula to calculate the rain tax uses a measure called ERU – Equivalent Residential Unit.? This equals the amount of impervious square footage in a typical home, factoring in the roof, driveways, walkways etc. One ERU equals 3,000 square feet. Existing taxes range from $3 to $9 per ERU per month.)

            Proponents argue it’s simply fair landowners pony up more money to finance the upgraded pipes that’ll be necessary in dealing with the big weather events that climate change is bringing. Opponents argue that real estate’s turning into a sitting duck asset with all levels of government assaulting owners as a cover for their profligate social spending. Taxing real estate based on its market value – which owners can’t influence nor escape – is bad enough. But taxing land more when it rains is, well, something only renters and commies-in-condos would dream up.

            The rain tax is maybe not a big deal. But it’s a harbinger.

            Climate change levies will be coming hard and fast over the next few years. Some may actually help the environment. Some will be pure revenue grabs. All will be cloaked in moral superiority. And count on overwhelming support from the largest voting demographic, those who believed in a shared economy and jazz hands.

            Real estate’s a prime target. You can’t move it. You can’t hide it. Urban properties eat resources and these days they’re symbols of wealth. Whether you believe man-made climate change is real or not, you’re going to pay for it. This may be the end of free parking at the mall.