The Wealthy Barber Podcast - #45 — Jon Flynn: Wow, The Canadian Housing Market Is Leaking And It Won't Stop Raining

Episode Date: February 24, 2026

Our guest this episode is Jon Flynn — Broker of Record at Flynn Real Estate Inc. and a well-respected Realtor with more than 15 years of experience. Jon is also the creator of the popular YouTube channel “Jon Flynn Real Estate Stats” where he analyzes Canadian housing trends and market data to help consumers better understand what’s happening in real estate. In this conversation, Dave and Jon dive into Canada’s housing market, from how Jon correctly predicted the current downturn to where prices could be headed next. They explore the impact of interest rates, affordability challenges and even artificial intelligence on jobs and housing demand. The discussion also tackles controversial industry topics like realtor commissions, lead generation, double representation and the iPro scandal involving misappropriated trust funds. Jon shares insights on why many markets are stuck, the risks of overpricing in a declining market and why some speculative builds could be in serious trouble. Whether you’re a homeowner, buyer, investor or just trying to make sense of Canada’s real estate headlines, this episode is packed with insights and practical perspective you won’t want to miss.   Show Notes (00:00) Intro & Disclaimer (00:55) Intro to Jon Flynn (03:04) How Jon Predicted the Real Estate Crash  (05:26) Where is the Real Estate Market Headed? (08:57) The Impact of AI on Jobs and Real Estate (11:16) Do Realtors Make Too Much Money? (14:58) The Debate Over Double Representation (17:05)  The iPro Scandal and Misappropriation of Trust Funds (21:32) The Impact of the Cost of Living on Home Buyers (25:05) “Lowball” Offers (26:04) Real Estate Markets Around the Country (28:35) The Dangers of Overpricing Your Home in a Down Market (32:08)  The Market is Stuck Because of Negative Equity and an Inability to Move Up (36:08) Speculative Country Home Builds Are in Trouble (38:46) Conclusion

Hey, it's Dave Chilton, the wealthy barber and former Dragon on Dragon Stent. Welcome to the Wealthy Barber podcast. Well, we'll be hosting some of the top minds in the world of personal finance. Yes, that's to balance me out. The podcast is about making the subject not just easy to understand, but dare I say, even fun, honest. Whether you're trying to fund your retirement, figure out how to build a down payment, save for your kids' education, manage debts, whatever, will be here to help you.

do it. Before we jump in, a quick but important note, nothing we discuss here should be taken as investment advice. We don't know you and your personal financial situation, so we're not here to tell you we're specifically to put your investment dollars. We're here to educate, get you thinking, and we hope entertain. But please do your own research and or consult with your financial advisor before taking any action. Hey, it's Dave Chilton, the wealthy barber with the Wealthy Barber podcast. Again, I want to thank all of you. I do this every week, but we are thrilled with the number of people listening to the podcast and the feedback we're getting.

So keep it up. We love hearing from you. We really do try hard to roll in your suggestions about guests, subject matter, specific questions, etc. I'm very excited about today's guests. One of the guests that I sought out, I went to John and said, I really want you to come on the show.

It's John Flynn. A lot of you know him from his real estate channel on YouTube where he does an outstanding job. We'll talk more about that in a minute. He's in the Niagara region. He's the broker of record at Flynn Real Estate. The YouTube channel is John Flynn, R.E. Stats. He basically uses his name and everything.

I joked with him ahead of time that he's named his kids, John Flynn, his dog, John Flynn, and immediately said, I did name my son, John Flynn. At least it was a son, not a daughter. I felt more comfortable with that. So I don't know if his creative naming skills are up to his knowledge level, but as he points out, in real estate, you always want to have a good, strong, personal brand. Why did I reach out to John? I've watched his YouTube channel for quite some time.

I find it really well done, supported by interesting stats. He tends to take a more national approach with a lot of the stats than regional. And that's often not the case when you watch different people on YouTube talk about real estate. But there's a bigger reason. John probably was the earliest and the most accurate in terms of calling the decline. You know, he went out there strongly and said, I think the Ontario market, He talked about the BC market as well, are going to go down from here and maybe even down quite some way. He took a lot of criticism early.

In fact, I would read the comments and a lot of people didn't agree with them. And of course, he's ended up being bang on. Also, to show you that I have a lot of trust and respect for him, I had a real estate question last year about the stats in the industry. He was a fellow I phone. Didn't know him, by the way. I just reached out to him and said, hey, I want this answer. And you're a guy, I think can give me a good response. and in fact he did. So John, welcome to the show.

Hey, thanks for having me on here and thanks for that great intro. No, you've done a very good job. Let's lead with that. I mean, that's really what's brought you to the forefront now. I see you as a guest on, you know, Ron's show and he's great, the angry mortgage and you're quoted so often now by big names in the real estate market. A lot of that credibility came, not just from your use of stats, but again, from the call you made that you felt real estate in many parts of the country was heading down. What led you to that conclusion. That's a great question. And I wish I could just say I was a numbers guy and I looked at the stats and this is what they said. But I saw what was happening in the industry and with the

buyers and sellers. And it was just a mania. It was a real estate mania out there. And it wasn't sitting right with me since like 2017 because there was a bubble in 2017 also. And I always, I'm always, I've always been a numbers guy and I ran the stats and I looked at the income, the price to income ratios and it just didn't make sense. But I saw what was happening. Like people were just the dumbest people in the world were making all this money and they were speculating on real estate and it just there was no fundamentals left. And I know there's a lot there's no fundamentals in anything these days. It seems especially in the stock market. Everything's stretched. That's for sure. Everybody's an investor. Everybody's like the, the smartest investors going. But it is like,

this thing has got to go at some point. There's no way. It can't keep going on. Like places where you know, 10 times the average household income in Canada and agents were still saying, you got to buy now, it's going to keep going up. And I'm like, and they had nothing to support it. So I started looking at the numbers more deeply. And whenever I did a home evaluation, I'd go and I'd look at the numbers and I'd say, this is what, this is what's happening and whatever else. But I look more deeply into them and I looked at historic trends and historic crashes and corrections and we were it just lined up and it all lined up with it was a very simple I have my home buying recipe right and it's a simple thing and a lot of people follow it it's been slow moving

lately but it's it's all linked to interest rates like ultra low interest rates prices go up for sure rates go up prices come down and then unemployment follows and mortgage arrears and things like that so it was it was a pretty simple recipe to find out where we are in the market and kind of predict how long this was going to last. And yeah, so that's, that's how I got involved. You know, when I look back to the end of 21 and the start of 22, like you, I knew that things were going to go down from there. And I was saying it a lot, but not because I'd done this deep analytical analysis you had. It was very simple. I thought, who can buy at these prices? I mean, as you mentioned, relative to incomes, prices had gotten crazy, but also investors couldn't buy at those

prices and cash flow positively without just absurdly big down payments, institutional buyers are too smart to come in at that height of the market. And so you look at and said, there's not going to be enough buying power here at these prices to sustain them. And we really did have the eight to go blow off top where it just went up crazily. But where I think you deserve a lot of credit is not just calling that, but you were one of the few voices who said it's not only going to correct back down, but it's probably

going to continue to slide for a while. not a lot of people were saying that. And so what led you to that conclusion and where do you think the market's going? Let's say in Ontario and BC and maybe the Calgary area, a lot of people live in those three spots. Where do you think it's heading over the next six months to a year to two? What we saw in the last five years or leading up to 2021, 2021, 2022 even was not normal. This is not normal that prices go up however much, 25% in some cases in certain areas.

What's normal is when you look back to. to 2008. That was a normal correction. Leading up to that and even after that, like, you were lucky to make three to five percent a year on real estate. Real estate investing was a job. It wasn't just take the money from your credit line or from your equity in your GTA home and speculate on a pre-construction condo or detached in Niagara or whatever the case was. That is not normal. What's normal is hard work and real estate wasn't a track. to invest in. Like, right. That's why there was no investors back then. And all of a sudden, we got into this mania of real estate investing. And I think the problem with it was, social media amplified everything.

The internet, of course, amplified it. But social media really amplified. And the message just got around that by a pre-con and you're going to be rich and you can assign it and whatever else. But we're headed back. We're into normal times now where, you know, again, speculating is not normal. So you're not going to see people speculating on real estate for a long time. It's going to happen again. point. It always happens. It happens. Sure. It happened in the late 80s. The late 80s run up to the early 90s was very similar to now and you hear a lot of people talking about that. And I've compared it in the past too. So you're going to see this slow grind down. We might have some hiccups that might make it worse. We might see some bigger legs down at some point. But we're already 33% in certain areas

in Ontario from the peak. Now it was a blow off top and that's debatable too. Was that blow off top? should that be smoothed out to show a lower peak? Because the only reason that happened was, remember when the Bank of Canada said, this inflation is transitory, we don't need to hike rates yet. And they waited too long. If they had started hiking rates,

we would have had a normal prices still would have went up a little bit for six to eight months, but it wouldn't have been as bad. It's going to be very similar to the 90s. We're going to see this slow grind down, flat prices. And when the bottom's going to happen, I've never called the bottom. I don't know if we're getting close though, like to talking about the bottom, right?

We're in that range. But again, the bottom's not going to be in 2026, in my opinion. And this is based off of historical numbers and cycles, right? No, I tend to agree with you. And I think that unfortunately the surprises that can come into the analysis are more likely to be negative than positive. So let's talk about a couple of those. The Canadian economy in certain areas, again, highlighting Ontario in particular, is challenged right now. the tariffs are starting to impact manufacturing more, the case-shaped economy with the bottom

40 and 50% of income earners not doing particularly well. You're seeing slowdowns reported by a fair number of companies. I worry that the economy itself could continue to trend down and that alone could drag real estate down another 5 to 10%. And then what are your thoughts on AI? You know, we're reading more and more. In the last two weeks, so many smart people from that space have come out and said it's going to lead a significant pullback and employment of entry-level jobs, white-collar jobs.

Well, that ripple effect of that will be significant on real estate. So that's a, that's a AI. That is a wildcard, in my opinion. I'm not going to say I'm going to go all in and it's going to take everyone's jobs. You know, you get the, the minds in that business like Elon Musk. Just today I read, like it's going to be all those office jobs first. The manual jobs are going to be safer now. But here's, here's an example of what happens.

recently, just with not the assistant AI that can think for itself, but just the input, the human input question, we were working on an office policy, updating our office policy for a certain criteria. I don't even want to mention what it is, but whatever, whenever, one of our regulations we have to deal with. And my wife, she's, she's an admin. She's an admin for me, and where's a mom and pop operation, right? So she's going and she's researching this, and I'm going to do an update course on it and all this stuff. And it's for the government, you know, it's, we got to comply with what they need. And I'm watching something and, and, and about, oh, about this open claw, right, clawed ball and stuff.

And, and, and, and I just, I go on to Grock and I say, hey, Grock, write me an office policy for this subject and give me an itemized list of things I need to implement. 10 seconds. 10 seconds. I know. I know. I text, I go to my wife. I go open up your, read that message. She's been working on this.

for three months reading up and you're going to read she's like perfect it even has a spot where I have to sign the office policy and everything on it it was done so yeah AI now are you talking how is it going to affect realtors in the real estate industry well I think that's an interesting topic because I think there's a fairly broad perception out there that realtors make too much money and I don't know whether it's fair or not I'm not even commenting on that I'm just saying the perception is there I'll comment on that for sure okay go ahead Fire away. And I hear it all the time. Yeah. And if you're looking at a successful deal, sure, the realtor made too much money. But they don't get paid for all the failures they have. I agree. That's a very fair point.

And a lot of times they have to show a buyer, for example, 30 houses. And I'm the first person to call out the realtors and say that they're lazy and they make too much money. But their success rate is like 30% of listings right now, maybe 35. So they spend a lot of time. like they're wasting 70% of their time out there. And that's the issue. So if you can compensate a realtor per hour, sure, it would be fine. But no one's going to want to do that.

It's like paying a lawyer. Like you don't want to have to pay a lawyer unless you have to. No, I think you're right. If I want to go back to your point about the realtors now, it's a struggle to get the listings to sell. And of course, you often have to take the buyers to a tremendous number of places. I think that's a very fair argument. And I think a lot of the people who seem a little bit bitter towards the income

that the real estate industry was making are thinking three, four, five years ago when the liquidity was just ridiculous. And houses were selling exceptionally quickly. And people were thinking like, that's a $2 million house. That's a $1 million house. The total commission is $50,000, $100,000. That's a percentage of equity, obviously. It can be dramatically higher. Do you think that really influenced people's thinking and they don't recognize that now it's back to being pretty hard work again to move the real estate? Yeah. And I think there's a lot of, a lot of realtors got a lot of attention by flashing and being flashy and bragging about how much they sold. And so again, you get the most realtors.

I can't see most. There's a lot of good realtors out there, hardworking people. I know a lot of the. Yeah. And real estate, a lot of people say, well, I can do real estate because I'm good at talking or I'm good at numbers or I'm good at how I know houses or I did construction. The issue with real estate is real estate, I tell people, don't do real estate. It's the hardest thing to succeed at because you could be good at everything.

You could have all the connections in the world, but you might be missing this one. You need to be like the master of everything with real estate and you need to be a problem solver. So a lot of people, there's no recipe for failure in real estate. It's like certain people struggle with certain things. Some people can't get leads, but you need this total package deal to do it by yourself. You could be on a team maybe and be a buyer's agent, but you're just going to be an employee. employee at that point. So yeah, it's a it's a tough job and I think the misconception that people have is, and I've never agreed with the story that people say like, it's easy. Like anyone could be a realtor. You just go get

your license and, you know, open the door for someone. Like, no, it's, there's a lot that goes on and you, you have to be a multifaceted, you know, entrepreneur of all sorts of things. People ask you all sorts questions and you're dealing with all sorts of situations, divorces and deaths and you need to be an emotional coach and like there's so much with real estate and you need to know how to be a problem solver. I said that's the number one skill you need problem solving. I completely agree with all of that. You do need to be an outstanding problem solver as you know better than anybody. Very few deals go smoothly even after the offer has been accepted. There's always something jumping up and biting the deal and so I couldn't agree with you more. Now one thing I've already.

argued with realtors about over the years, including on the podcast one, says, I've never been a believer that an agent should be able to represent both sides. I agree. To me, that's just doesn't make any sense. You don't see it in any other space out there. You know, lawyers certainly can't do it, et cetera, et cetera. What are your thoughts on that? I don't think realtors should be able to represent both sides.

It is a can of worms, Pandora's box, whatever you want to call it. It shouldn't happen. I don't like it when people come to me. And the problem now is that consumers are informed. They've been informed for a long time. Like when I first started, they didn't know. They didn't representation. Even now, people still don't care about representation,

but they're informed for their own benefit. Now, geez, it was like 2015, maybe. I'll tell you a quick story. I'm standing in this house. This guy calls me direct. I say, do you have an agent? No, I don't have an agent. Well, I got friends.

You know, he's obviously, he's not signed up to an agent, but he's looking at this house. And this is the perfect house for him. He's into the feng shui and the bathrooms over here or whatever else. And so he says to me, he says, we're standing in the house. I just showed him the house. Just met this guy. He says, John, if I'm going to buy the house through you, we're going to minus two and a half percent.

And he's going on. And he's like calculating it right in front of me. I said, I go, how do you know what I'm charging or what I'm offering? Right. Like, how do you know this? Well, that's, you know, what the going rate is. And he says, do you want me to use you or do you want me to use my own agent? Because I'm using you.

You're going to minus this month. much often. I said, no, go get your own agent. I said, I don't want to represent you. I just met you. But you, you, and you shouldn't like, I take all the benefit out of it for me if it does happen. Now it's really hard because of the rules change. The rules change last year. For sure. With the, we went from the real estate and business brokers act to the trust in real estate services act. Like, and I made, I made fun of this. I'm like, so you just, you went from a business brokers act to a trust, Trust me act. This is called Trust the Realtors Act, right?

So, yeah, bad things happen and it never works out well. I can't even remember. When they audited me, they just did an office audit last year. They did it every four years. And it was way worse than the last time because this was happened. Mine happened probably after they found out about the Ipro scandal and stuff, right? But they hadn't disclosed it to the public yet, and I didn't know about it at that point. But they audit, they took all day.

And the time before that, the girl came in in 2021, it was. She was here for an hour and a half. She checked my trust account, checked a few files, and then she went to the casino. She goes, I'm going to the casino. My husband's coming to pick me up. He was waiting at the coffee shop. I'm very comforted by the fact they're taking the audits more seriously. I mean, it's not just I pro.

We've had another major event since then. And for the listeners to understand, we've had some brokers do bad things with the trust funds. And, you know, what happens, by the way? this is something I get asked. When that happens, what recourse is there for the people who suffer? They lost the down payment or an agent lost a pool of commissions. What happens? Well, RICO comes in and salvages what they can. They freeze your accounts and they take whatever's left from wherever. We're going to see there's probably going to hopefully be a new precedent, but there's insurance. So we pay into our insurance every year that covers missing trust funds, commissions and stuff like that.

So it is insured. But now the agents only get 50. 50% but now those are getting 100% from the, I think it was the I pro. But it isn't sure, but it shouldn't be happening. Like, it is against the law. It is illegal to take the money out. And the latest one, they were kiting, check kiting is what they were doing. And they were kiting. You can't take the money.

People's money. This is people's money. So like somebody buys a house and here's $25,000 for my deposit. And I'm going to take it and pay my lease or something with it as a broker. Oh, but I'm going to put it back or maybe I won't put it back or maybe I'll renovate my cottage like supposedly, you know, the other guys did. But it's illegal. It shouldn't happen. And I put out there, I think on my last video, I said, I guarantee anyone that has money in my trust account, I personally guarantee it.

And this is what I put out on X. I said, brokers of records should be personally guarantee, they should have to personally guarantee that trust money. Love it. And they're like, oh, you're crazy, John. I'm like, no. It's nobody's money, but the people, it's the consumer's money. I completely agree with that. What do they see as the downside of that?

I mean, it's not going to have a problem if you're not taking it. And therefore, I think that your idea makes a lot of sense. There's three ways that money comes out of the trust account. By court order, a successful completion of a deal or a mutual release. That's the only way that money comes out. And these guys are taking it out. And Rico, again, this is what's happened. Now they're going a little bit further.

But they would come in and say, well, you got to shut your office down and you're done. And they go, okay, I'll shut it down and where's the money? And then that they can go. But you know what? Their family's still in the business. Their kids are still working. They just change brokerages to another brokerage.

And they get to do it for free. They don't even have to pay the fee because Rico says, all your agents can switch for free and it's like $100 or something anyway. It's not a big cost to switch brokerages. Yeah, and I don't want the innocent agents to suffer, but the people who actually took the money out of the trust accounts, the punishment should be much harser than they've been over the years. I mean, suspension from the industry, restitution, all the whole gamut.

I mean, I'm not even afraid to say, I think, jail time in some instances. It should be jail time. It's illegal. This is theft. This is theft. And I mean, I don't understand why there's some pushback on that. But are you worried we're going to see even more of it now that the market has taken such a turn? And we're seeing far fewer transactions, et cetera.

I'm worried that we may have a couple more of these pop up. I don't know for sure. But I'm guessing they're already out there. They just look at the last one. It was last year. when they discovered this and they've been litigating and they're doing whatever they're doing with the brokerage. So it's going to be, there's going to be more of this.

And when you look back at these big cycles in the 80s and stuff, there was huge, what is it, Canada, something. I forget what it was before my time, but there was a huge brokerage. It was like a bank and a brokerage combined. It went belly up way back. No, I remember that well. Nothing is before my time. Unfortunately, John, nothing.

Yeah, so, yeah, it's sad. I had to look in the history books, so. And the guys, like, I've, I've, I worked with a lot of old timers when I first started. So, like, they told me all the stories and stuff. I don't call anybody old timers anymore. Like, now that I'm at that age. Oh, yeah, me too.

I know. But back then they were. Okay, I'm going to run a theory by you that I haven't seen anywhere, read anywhere, but it's a theory I've come up with because I've been speaking to so many younger people in the last year as I put the revised version of the wealthy barber together. I think one of the reasons the buyers have pulled back and they're less aggressive is that people have started to grasp more clearly what they're. this cost of living currently is.

They are looking at their cash flow and they're going, everything costs so much more now than it did five, six, seven years ago. I am squeezed and they're looking at homeownership in particular. And they're saying it's not just the cost of the house and therefore the size of the mortgage and those payments. Property taxes are rising at a greater than CPI pace in most regions. Home insurance. Everything to do with homes, rentals, small fixups, they've all gone up dramatically in the last

five to ten years. A number of buyers are going, I've got to be careful here. I can't spend as much on the home as I thought I could, as much as the bank's formulas are telling me I can. I've got to be more cautious. I think that's healthy in a lot of ways, but I'm seeing more and more people express that viewpoint. I ran that by in a long-winded voicemail to a friend of mine who is the CEO of one of the

biggest builders in the country. And he surprised me, called me back and said, you're bang on. We can tell from our research that that is happening, that people are thinking, I've got to be careful. And you made the point about the lunacy. I think that was the word you used that we saw to, 2017, 19, 20, 21, etc. Where people really didn't seem to even care what they paid relative to their incomes.

Do you think this is happening a bit where people are seeing the cost of living and going, I got to watch it? Definitely. And they don't even know it's happening, I think, that you hit the nail in the head, but they don't even realize this. They're just subconsciously acting on it. It's all about the market sentiment, right? So real estate and stocks and everything, it's market sentiment.

And that's what drives real estate. And it takes a long time to switch, but it has switched. We're now in that be cautious. Save what you got. Sell what you can when it comes to that point, right? Right. But it's, yeah, the sentiment's changed. And that's good because this euphoria sentiment was just terrible.

This is what drove the market to these extreme highs. I'm glad that it's changed. And it takes a long time to change. Like it took years after the peak like 2023, 24. The spring comes and prices are going back up. Oh, my God. And people are still worried. I talked to the buyers.

And they were still like, John, like, this is my, I know it's still high, but this is my chance. Forget about it. You want to buy a house when nobody else wants. When you're like, I'm not buying a house, that's like, there's no way I'm buying a house right now. That's when you should be buying a house. But we're not even at that point. We're just like, well, it's too expensive. And it's, I got to save for a rainy day kind of thing.

But that's what people don't realize. And we're getting to the point. And you probably see it like by next year, they're going to be given house. you're going to be like, nah, this is the best deal in 10 years. No, no, thanks. I don't want it. But you know what's interesting. I'm going to give you a lot of credit here.

I really am going to pump you up a bit. You're not saying that with the benefit of hindsight. You were saying that after that big pullback off the big spike and we saw prices go back, normalize a little bit. You kept saying it's not going back up quickly. And people who are thinking the spring market's going to save it or the lower interest rates are going to save it are wrong. And that it's going to continue to slide.

I remember watching your videos and thinking, good for him because not a lot of realtors are out there saying, I think real estate market is going down. I got killed in the comments too. You did. And every spring and the same people, they don't come back. They haven't been back in a while. No, you were very strong there in the Ontario market. And even when you talked about BC, et cetera, and those types of things. I mean, we have a buyer's market now, no question. I'm a little surprised that we don't see more low ball offers. And I mean, sometimes you talk to people looking to buy homes and maybe unfairly, but they'll blame the realtor and say the realtor was uncomfortable. going in at 50,000, 60,000, 70,000 underass. Is there any truth of that criticism? Yes, 100%.

I hear it all the time. I hear stories. I was at a guy's house. I'm going to list this house. And he said last year he had, he saw a house in his neighborhood. And he said, I want to put an offering on this house. And I want to put this much. And he watches me, right?

And it wasn't even a low ball. And his agent said, it's too low. You're wasting your time. It's going to insult them. Whatever. It's just don't bother. It's too low. The house sold for less than the guy.

was going to offer. Oh, boy. Obviously, he's not dealing with that agent anymore. And the agent was a good guy. Like, it was a good aide. Like, it wasn't like a bad person, but it was just bad advice. And, you know, you see seasonal, you'll see, okay, or you'll hear things. Like, there's a bunch of offers.

And that's the problem. When people, they listen to certain things and they don't actually do their own research. So they'll hear, I put a post out today and people talking about the Quebec market and the East Coast. We're seeing the sales to new listings ratio. slow significantly, especially in Quebec. Quebec's still on fire. There's still multiple offers going on. But we're seeing it from last year.

It was like 65%. So 65% of all new listings sell. Huge number. And this year in it's like 41 or 42. And I think Montreal is in the 30s. It's in a buyer's market right now in for January. Now it's not a buyer's market. It's seasonal.

But still, when you compare last January to this January, you can clearly see it's slowing down. This is what I look for. to get ahead of the market. And so I put this out that and I, you know, I made note of those two areas. And people, there's still multiple offers, places they're selling for 100,000 over. When somebody tells you there was 52 offers, I just dealt with a post like that too. Like, it was listed at 749 and sold for 992 or something.

Right. So they just undermarket listed. That's not the same. Don't listen to anybody when they tell you a place sold for so much over. What did the last place sell for? What are the last three places to sell for? Right. How much overmarket value did it sell?

I know that, you know, Quebec was still going up. But we're seeing the signs. And we saw it. I saw the same thing last year with Calgary where it was, that ratio was slowing. And Calgary, it looks like it's topped, right? It's things. They had every, every type of house in January was down year over year from the previous year. So, and Edmonton, too.

Edmonton, their sales and listings ratio dropped significantly. So, yeah, we're seeing, we're seeing big changes in those secondary and tertiary markets. at this point. The Calgary market turned pretty quickly. Yeah. I mean, it was kind of roaring and then, you know, flatlined and started heading down a little bit on most of the ratios you look at very quickly compared to most changes. Yeah.

And it's like a locomotive, right, these markets like Ontario and Calgary. Like they don't just stop. Like they'll, and we go through our seasons big time in Canada. So you'll see it slow and it'll pick it. Oh, that's it. It's over. The crash is over and we're back. And it's like, no, like it doesn't happen like that.

It takes years and years. And that was one mistake I made. Like, it was taking forever for things to happen. And I knew it would, but like you don't realize like when you're going through it. Like this takes a long time for. No, you're right. It's sentiment driven and it doesn't happen quickly. And so as a forecaster, you have to be patient to let your theories play out for sure.

Okay, I'm not trying to pick on realtors. I'm really not. A lot of my closest friends are very good realtors at a lot of value, one of my family members. So, but I am going to offer criticism that I saw a lot in 23. 24 is you had people want to sell their house and the realtors said, let's seek out this number. I was directly involved in a few of these and said, holy smokes, I wouldn't be trying to get above market right now because you've got a declining market. And if you don't get somebody to pay that premium price you're looking for in two and three and four months, you could have a

completely different market that could be down to three and five percent, which on an $800,000 house, of course, is far from being consequential. That pattern seemed to play itself out a tremendous this amount where a lot of the realtors had trouble accepting that we were in a different market than they had seen in most of their career, wasn't flying up. It was slowly grinding down, and that meant different strategies were more appropriate. Yeah, it's true. Realters have been accustomed to and fine-tuned to say the market always goes up because that's what's good for business. And you never want to go back to a house and say, well, it's worth less. And a lot of times it is the realtors, but a lot of times it's the sellers too, right? I agree with that.

In fact, out of fairness, I should say I think that this was more the sellers, but I think the realtors should have been forceable in saying, you're off here. It's a different market. If we get caught locking in on that price and don't get it, we could be looking at significantly less in a few months. And you were saying people have been trained to say it's going up, but the marketplace trained them that way too because the market has gone up, up, up for almost ever. And we all became so accustomed to that. And the corporate training, like it's all positivity training, right,

when you go into the sales training and whatever else. You can't go in and like here's the reality. And it's hard. I'm guilty too. Like sometimes, you know, I'm a people pleaser. I don't like to let people down. And I say like, okay, like you guys are like way off. I'm thinking in my head.

But like maybe I can put your, maybe if I can tell your house is just a little bit higher than it should be, you know, I'll make you happen. I don't even, I don't even want the listing. But again, it's, it's hard to see their reactions when you tell them whatever. But but then you get to the point where you're just like, no, like this is what your house is worth. You can try it higher. but we got to have a strategy. So my thing is I always tell them strategy, reduce, we're going to reduce it two weeks, we're going to revisit it.

And that's what you got to do. But yeah, the realtors, they're dealing with clients, repeat clients that they told them like the market was always going to go up too. So they're trying to say face a lot of them. Or another thing that's, again, I think you touched on it. The issue is they'll say, well, just wait until we'll put it back on the spring. Because again, it's their, and the realtor cannot face reality. But why? What's the reasoning?

Is it because they sold them the house or they made fake promises at some point in time? And the realtor is actually costing those people a lot of money by not being honest with them and saying, look, you got to, you got to this. Like the market's not going up. You got to go down. Like this is where we are now. Like you're not waiting. If you wait until next year or next spring, like you're probably going to get less. This is what I tell people.

And it's true. And you know, it's interesting. Because I don't think the realtors that I was exposed to the ones I referred to earlier with this particular problem, I don't think they're being dishonest at all. I think they had convinced themselves that the market was going to go back up again. And I think, again, that's just years of it doing that. And again, the training you mentioned at the corporate level, et cetera, and the thought that interest mates may go down, spring is always quoted. But when you took a step back and looked at the actual underlying data, plus you saw how

obscenely high prices got relative to incomes, you could see that your argument really was a good one. It doesn't mean you were going to be right for sure, but the odds favored, I think, you being right. All right, next question is, how big an issue is it in the real estate? market right now in many areas. And again, I don't mean to always focus on Ontario, but let's use Ontario and BC. And to a lesser extent, Calgary, when you've got this group of buyers that came in in 19, 20, 21, or early 22, and a lot of them don't have any equity in their home anymore,

that the market has gone down enough that it's taken away the equity they had if they put down a 10, 15, sometimes even a 20% down payment if they bought at the peak. Therefore, they can't move up. They have no ability. And the market is stuck for the first time in years we're running into that problem where instead of increasing equity, it decreased. I think that's a bigger issue than people are making it out to be. And it's a bit of a self-fulfilling issue in terms of why the market's scupling so much. This is a systemic long-term issue that we're going to face. I was dealing with these first-time buyers. I'm in Niagara and we're in Welland, right? You go and you get better deals over there. So we go to this one house. They had offers on all these other houses and it was a

grind and we're putting low offers. They watched my channel. I got no problem. I got no problem. putting low offers sometimes but you got to look at the situation like is that person in a position where they can actually accept a low offer if need be or did they just not that's a fair point you it's some can't yeah so so we're in on this house and it was we look at the history it was on the market and it was they keep reducing and it was like 429,000 or something it was priced at so we put this offer in and whatever I think it was in the threes but whatever you know we're going to settle somewhere around for something that was the idea and the agent says hey and I look at the history. They paid 600,000 for these sellers. And I'm working with the buyers. And they, the agent says, John, I'm going to need. And I'm showing it. And whatever. And I'm like, wow, these people were really overpaid for this house. Like, like, they must have had a big down payment or something, right? Because they're selling it. Like, so I said the agent, like they paid a lot for that house. And the peak pricing. And he says, yeah, he goes, we need the bank approval. When if you submit an offer, we need the bank to approve it because they owe more than it, then they're going to sell it for. And the bank, they need to work out a deal with the bank with the credit line or something.

And then you, I don't know how you're going to get paid, John. Like, you might want to ask your buyers to pay you. And I'm like, the first time buyers are not paying me. Like, that's not how it works. Like, you know, that offer doesn't even go together because it was taking so long. It had a response. My guys move on to this next house. It's very similar around the corner.

Paid $500,000. They got it for $3.85. It actually closes today. So they got it for $3.85. I get back from my vacation last week, right? It's all good. We're good. Now, I'm coming back and I'm like, I'm glad they didn't buy that other house, right?

because I would have worked for free, right? I've been doing this 20-something years, whatever. I always got paid. Like, big deal. Sometimes you've got to take one on the chin, you know, you don't get paid. It's not the end of the world. I just come home, like, I got to call them to do the final walkthrough, right? So I'm thinking about the house.

And I'm like, I'm glad they didn't buy that house. And like not even 24 hours home. The agent calls me up. John, yeah, this is old. The lawyer called me. The seller didn't disclose. He has a second mortgage and a line of credit on the house. And we need to start cutting commission.

And even the, the line of credit. So the line of credit had to go from like $72,000 to $40,000. They took a loss or the, sorry, the second mortgage. And then she's like asking me like, can we take a hit? I wasn't even listening to her at this point. I'm just like, I go, hey, to the agent. I go to this guy. I got like a used car or a watch or like some silver or some gold.

Because he had nice stuff in the house. Like it wasn't trashed out. And she's like, what? I'm like, I'll barter, whatever. Give me something. I don't care. She's like, are you serious? I'm like, yeah.

And then anyway, she wouldn't do that. And I said, I'll claim it on taxes or whatever you want. But yeah, it was, but we're seeing a lot of that now. And we're seeing a lot of those listings come up because those are the people that didn't make good financial decisions. Right. They overpaid for the house. They didn't think about it.

And now they're just, they're like, what's the point of keeping this house? It's eating up every bit of money I have. I'm not getting overtime at work or I got to cut back and inflation's roaring. My groceries are up and yeah. So it's. And they're having to reset at a higher mortgage rate in some instances this year. And that's a part of the squeeze as well. Well, okay, let me finish with one question.

When I drive around southwestern Ontario, and I'm sure it's true of many other parts in the country, one part of the inventory challenge that you see over and over again is these nicer country homes that were built 10, 7, and 5 years ago. A lot of people, especially during COVID, thought I'm going to be able to work from home. They built nice hunting homes on, say, a farm cutaway. Holy smokes are those proving to be difficult to sell. Like a lot of the ones you drive by have been for sale for six months and a year. to a couple of the realtors said almost no nibbles. These people are going to have to come down

significantly in price. Have you seen that in the Niagara region as well? Yep. I was showing what, again, subscriber of mine calls me up. I'm showing one in Grimsby and it was listed with whatever agent. So we show the house and I start doing the calculations, right? This is what I do. And I'm like, okay, this is, and I looked at what they paid. There was an old house still in front of this new house because they bought a lot with this old house. I look it up. Okay, they paid almost a million for this. And they still haven't knocked the thing down and they haven't done the landscaping. They built this house 3,000 plus square feet. I'm running numbers.

And I'm like, and it's not like 2.7 or 2.6 million. And they've already reduced it. Exactly what I'm talking about. They've already reduced it, right? And the agent's like, well, they built it for them family and then things changed. And I'm like, bullshit. Like they, he bought it to speculate. And because they thought, and I saw when they paid it when they bought it and stuff.

And anyway, so my guys, and I run, I'm like, this thing's first like 2.1, 2.2 in my opinion. Like it's worth what they built it for, but they overpaid for the lot. So that's not my problem. And so anyway, so time goes on. And we'll just watch it, right? We'll watch it. Then I got a call from another agent. I don't know how he got my number.

It's going power of sale. It's a private lender, right? So the private lender's taking it back. Private lender had to do the landscaping on it. And yeah, it's so there is a lot of those. And again, those are speculative builds. And I've heard crazy stories from people renting other places where, you know, people have leveraged themselves on these things from the GTA and thinking, oh, you can get 10 acres in Niagara for this price is going to be worth 50 million, right?

It's like, no, we see it down here. And I mean, some of the people went to the four to five million dollar spot on the bill of land combo. And I think right now they'd be lucky to get 2.2 to 2.5. But what I'm hearing is they're not getting offers, period. No. Like it's just there's not that many people who want to take on a three and four million dollar house out in the country, especially with people being called back into work at. etc. Plus, these people built the house to be appealing to them. When people are going to spend that much money, they think, well, I'll build something that's more to my liking. So all of these factors come into play. But it's interesting you're seeing that as well. Look, I really enjoyed this today. You're welcome back on anytime. I highly recommend your YouTube channel. I think it's excellent. Your track record has been fantastic. Do you follow Daniel Foch at all? You must have

crossed past with him. Oh, yeah. He's got a lot of good stuff too. Well, he talks about a lot about AI lately, right? Yeah, he's really getting into the AI and trying to be on the cutting edge of where technology's taking the industry. So I'm going to watch him before I do anything stupid myself. It's actually a good idea because he's out there trying things and learning and he's a very smart guy. Yeah, he's super smart. He really is. And I like listening to him. And he's got a really good feel for economics, you know, to be honest with you. Some of his economic analysis, I actually prefer to some of the economists. Yeah. Like he's got his boots on the ground too and he kind of weaves it all together. So, no, he's very good.

You should write a book sometime, John Flynn on John Flynn real estate. Just get the name of twice. I started writing a book and I got to finish it. I'm about halfway done. And it's good. The title is debatable, but it's going to be called the average agent. Interesting. Something.

Yeah. You can come up. Well, you know that the best titles they say are article, adjective noun. Okay. Those are the titles that tend to sell the best, the wealthy barber. And so your idea there, the average agent is very, very interesting. Anyway, it's a real pleasure having you on. You did a great job. A lot of fun chatting and let's do it again. Thanks. Thanks for having me on, Dave.