Housing Is Now Crashing: No Rebound For 18 Months Warns Expert | Ron Butler

Base-case outlook (Housing)

• Housing is expected to remain under pressure for at least ~18 months.
• There is no near-term rebound in home prices in Ontario and British Columbia (BC).
  • BC is specifically described as having “more runway to fall.”

Mortgage-rate backdrop (US)

Current level / near-term trend

• 30-year fixed mortgage (conforming loans ≤ $832k): 6.58% vs 6.57% the prior week
  • Interpreted as a slightly upward trend.

Sentiment/transaction implication

• Once rates cross the “6% plateau,” he expects mortgage activity to “wilt” (i.e., a decline in transaction demand tied to higher rates).

Mortgage-rate forecast (prediction market)

• Using Koshi (prediction market), traders assign a:
  • 64% chance the 30-year mortgage rate ends above 6.7% by year-end.
• An example trade is cited to illustrate implied expectations (not as investment advice):
  • A $50 wager could pay $96 if the outcome occurs.

Macro drivers and transmission to housing

Rates vs central-bank policy

• Mortgage rates are framed as following supply/demand dynamics more than direct central-bank action.
• However, an inflation relationship to the Fed is acknowledged.

Explicit linkage described

• If inflation ramps up, it implies:
  • higher 10-year yields → higher mortgage rates → higher Fed funds rate
  • (Described as “100% correct” in the discussion.)

Oil as an inflation / rates indicator

• WTI (oil) is called “the easiest” indicator (though not perfect).
• Key implication:
  • Sustained WTI > ~$100/barrel would keep inflation elevated.
• Threshold stated:
  • “Everything over $80–$90 is inflationary.”

Geopolitical risk

• War/ceasefire de-escalation risk is described as not resolving, implying:
  • prolonged higher oil prices
  • ongoing inflation pressure
• While the “oil landing zone” is uncertain, inflationary pressure is treated as robust.

Canada vs US divergence

• Canada is described as weak / K-shaped; the US as comparatively fine.
• BoC Governor Tiff Macklem is portrayed as reluctant to raise rates, though inflation could force action.
• The host suggests BoC likely holds off as long as the US increases later.

Housing market dynamics

Rotation: condos vs single-family

• Condo weakness is not perfectly offset by single-family strength; it’s regional.
• A rotation back toward single-family is possible, but:
  • single-family prices are already at “record high prices,” limiting rebound potential.
• Condo issues cited:
  • oversupply
  • governance/build-quality concerns

Homebuilders

• Expected direction: decline in homebuilder activity.
• Rationale:
  • Higher mortgage rates reduce buyers’ financing capacity.
  • Builders face higher financing costs and lower sales probability.
  • Affordability friction example:
    • at ~6.79% mortgage rates, buyers need a lot of income.

Canada policy: “buy out developers” / BC condo bailout

Policy description

• Canada’s plan (attributed to Prime Minister Mark Carney) would spend upwards of $1.4B to buy out BC condo developers with unsold, underwater projects.

Scale and targets

• More than 2,200 vacant condo units intended to be converted into affordable housing.
• Timeline context from the conversation:
  • announcement referenced as June
  • discussion date: July 10
  • claims that no concrete conversion plan exists yet

Critique: market pricing vs intervention

• The argument: government intervention derails market price discovery (receivership/auction).
• Position:
  • the “lowest price is an auction”
  • government using tax money lacks “perfect knowledge” of fair value

Taxpayer optics vs “market actor” justification

• He disputes the idea that “government is just another market actor,” emphasizing auctions as the reliable mechanism to confirm price.

“No-luxury-purchases” condition (as described)

• Claimed decision:
  • no purchases in Vancouver proper / Burnaby (or other high-rise areas)
• Instead, purchases would target lower-cost Fraser Valley condos.
• The operating model (e.g., rent-to-own) is described as unknown.

“Market health” / performance indicators

Price and transaction expectations

• Expect continued price pressure, not rebound.

Foreclosures / power sales (Canada)

• Claim:
  • foreclosures and power sales rose from the lowest base in 3 years to historic-average-ish levels
• Expectation:
  • continued growth before it slows.

Population as a housing-demand metric

• Rebound confirmation requires positive population growth in BC and Ontario.
• Current stance:
  • population growth remains negative
  • he expects the negative trend to persist “for a little while”
• Poor demographics are tied to weak housing demand, limiting rebound feasibility.

Explicit recommendations and cautions (timing)

Sellers

• If waiting for a rebound:
  • expect to wait ~18 months (could be longer).
• Recommendation:
  • sell if you have a reason to move
  • don’t expect meaningful improvement from waiting 3–6 months.

Buyers

• Recommendation: be patient.
• Timeline guidance:
  • BC: “more runway to fall”
  • Ontario: start getting serious in the fall (specifically October/November)
    • evaluate inventory that fits budget

Rebound skepticism (2026 sales/listings)

• Improved sales/listings in 2026 is dismissed as “real estate propaganda.”
• Conditions are described as below longer-term averages, so improved data does not necessarily imply a rapid turnaround.

Assets / instruments / metrics mentioned

• WTI oil (used for inflation/rates thresholds; no specific ticker provided)
• Koshi (prediction market platform)
• 30-year fixed mortgage rate (metric discussed)
• 10-year yield / 10-year numbers (macro yield metric)
• Fed funds rate (policy rate)

Frameworks explicitly described

Mortgage-rate linkage (macro transmission)

• Inflation → higher 10-year yields → higher mortgage rates → higher Fed funds rate

Housing rebound “confirmation” framework

• Rebound requires positive population growth in BC and Ontario (framed as a necessary near-to-medium term condition).

Government pricing framework (market vs intervention)

• “Fair low price discovery” is framed as receiverhip auction, not government negotiation/assessment.

Disclosures / disclaimers

• A typical “financial advice” disclaimer is not clearly stated in the subtitles provided.
  • (No explicit “not financial advice” text appears.)

Presenters / sources mentioned

• Ron Butler — host of the Angry Mortgage Podcast; principal mortgage broker at Butler Mortgage
• David — interviewer (referenced as “David” on-screen)
• Justin Trudeau — Prime Minister referenced
• Mark Carney — referenced (Canadian PM / BoC connection) and associated with the BC condo plan
• Tiff Macklem / Tiff Mlin — BoC Governor referenced
• Kosi / Koshi — prediction market referenced (sponsor mentioned)
• CNBC — article cited
• CBC — article referenced as summarized
• Toronto Regional Real Estate Board (TRREB) — referenced for market-condition data
• David Eie — BC Premier named
• Prime Minister Mark Carney and BC Premier David Eie — both explicitly named