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Ron Butler: latest market views
Butler Mortgage
Summary
Ron Butler is the founder and principal mortgage broker of Toronto-based Butler Mortgage, a mortgage industry veteran of 30+ years, and host of the Angry Mortgage podcast, known for his bearish, blunt commentary on Canadian housing and interest rates.
Chorus has 28 views from Ron Butler across 2 episodes on The David Lin Report since October 16, 2026.
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Long-term bond yields are set to rise next year, with fixed-income executives highly convinced of the trend.
Ron says fixed-income executives at Canadian and US institutions are increasingly bearish on bond yields globally, especially long-term yields. Those yields drive US 25- and 30-year fixed mortgage rates and Canadian bond yields. He says all bond yields will be higher next year and central banks will keep raising rates. He concedes yields will dip and jump day to day, and that recent falls in the 10-year do not change the trend. The synchronized global setup, in his view, makes the direction of government bond yields 'kinda clear'.
“The layout, the trend, the whole setup synchronized across the world for bond yields, government bond yields seems to be kinda clear at this point. ... I just think the setup is for higher higher bond yields.”at 5:14
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Adjustable-rate mortgage resets are not a big issue, as ARM use is a small share of mortgages.
Ron says ARMs had their day just before 2008, then took such a beating that their use fell off a cliff. Even as more people market and take them today, borrowers using ARMs are still a very small percentage of the mortgage-acquiring public. He does not see ARM resets as a big issue. He pushes back on the concern that a large share of the roughly 3.1 million ARMs will reset soon, since they are a small slice of about 55 million active mortgages.
“And even today, when it's increasing, when there's more people marketing it and there's more people taking it, that people taking it are still a very, very small percentage of the mortgage acquiring public.”at 7:27
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Buyers sitting out high mortgage rates will keep pushing US home prices down, despite few sellers.
Ron says about 40% of US mortgage holders have rates near 3%, so they will not sell and take on a 7.1% to 7.3% mortgage. That lock-in creates the shortage of sellers. But with buyers also priced out, the buyer-to-seller ratio is badly skewed. Because many buyers are out of the market and expect rates to fall next year, the few who would buy are not present and prices fall. He adds that builders' incentives cannot overcome the high rates, so construction is hit even harder than resale.
“So yeah, I'm just out of the market. And if you're out of the market as a buyer, prices come down.”at 12:25
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Bank of Canada will hike rates on October 28 or December, as its inflation pivot is clear.
Ron argues the Bank of Canada's only job is to contain inflation, and its only tool is the policy rate. He says the upcoming Canadian inflation print is unlikely to be good and another print in November will influence the December 9 meeting. He points to Governor Macklem shifting from talking about a weak economy for about a year to talking about inflation in a Halifax speech. He notes the US, Bank of Japan and ECB have already raised rates, so he expects the Bank of Canada to follow and says it is only a question of timing.
“These people know how to signal their future moves. ... And once he saw The US raise, the Bank of Japan raised, European Central Bank raised, he knows it's gonna happen, and it's just a question of when.”at 16:42
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Canada, Australia & other developed economies
Canadian small condos are the most beaten-up real estate category and will keep under pressure.
Ron defines the 'dog crate' condo as under about 500 square feet, often 385 to 425, with a poor layout in a weak building. He says these units face enormous pressure from falling prices, rising property tax and condo fees, and higher mortgage rates. Those factors will do more damage to the segment. He calls it the most beaten-up single category of real estate in Canada. He also says the difficulties with tiny condos will last well past the recovery in ground-based homes.
“They are under enormous pressure and will continue under pressure and higher mortgage rates will just do more damage to that marketplace. It is certainly the most beat up single category of real estate in Canada.”at 17:48
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Canada, Australia & other developed economies
Ontario and BC landlords face negative cash flow and falling rents; they should sell even at a loss.
Ron says many rental-property owners in Ontario have negative cash flow while property values fall. Expenses are rising, including property taxes, mortgage rates and condo maintenance fees. Asking rents have fallen for 24 straight months nationally, especially in Ontario and BC. That combination squeezes landlords with no offsetting rent growth. He concludes that owners should sell soon, even at a substantial loss.
“People better get serious about selling these things even if they're gonna take a substantial loss.”at 19:10
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
US rents will not fall for months; a strong jobs market lets landlords keep raising rents.
Ron says the US economy is in good shape and shelter CPI reflects lagging numbers. With unemployment around 4%, many people are working and landlords can keep getting decent rent increases. He sees no reason for landlords to cut rents while people are employed and the economy is moving. He expects no rent decline in the US for months.
“And I would suggest to you that in The US, we won't see any sort of [rent] devolution for months.”at 20:01
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
The US-Canada trade war is pressuring Canadian jobs and making buyers nervous, weighing on housing.
Ron ties the trade war to Canadian unemployment, pointing to recent job losses. Threats of a trade war add pressure on jobs, and some people who lose work will move back with parents or couch surf. Without work, paying rent or a mortgage is hard. He also says the trade conflict makes homebuyers nervous and holds back prices. He sees the end of the trade war as a prerequisite for a housing turnaround.
“And the threat of the trade war in Canada puts a further pressure on unemployment, those job losses you talked about.”at 20:31
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Canada, Australia & other developed economies
Canadian forced sales set new comps 8-10% below prior lows, dragging whole regional housing markets lower.
Ron has tracked court-ordered and power-of-sale foreclosures. He says these sales consistently clear 8-10% below the lowest previous sale, because lenders want the lowest possible bids. Each one creates a new comparable sale for the neighborhood, and the whole region then drops in value. He says this has played out consistently and has gone on for almost a year. Financial pressure has been grinding for a couple of years, so he expects it to last another year or two. This pushes more owners to walk away, feeding the cycle.
“And yet once that sale takes place, which is, again, 10% lower than the last lowest sale, it creates a whole new set of comps for the neighborhood, and the whole region drops in value.”at 25:02
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Canada, Australia & other developed economies
Ending Canada's foreign buyer ban won't lift home prices; the buyer demand isn't there.
Ron says provinces with large foreign-buyer taxes, including BC and Ontario, will not drop them. Those taxes will deter buyers even after the federal ban ends. Foreign demand has also shrunk, because the Chinese property market has collapsed and it was mainly Mainland Chinese buyers before. Buyers also do not want to catch a falling knife. He says there is no line of waiting buyers and virtually no interest, so any idea of an immediate price rise is 'hopium'.
“Anyone who feels that the end of the federal home buyers ban will cause an immediate upward movement in home prices, we say that those people are smoking the hopium pipe.”at 28:10
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Canada, Australia & other developed economies
Canadian home prices will plateau through 2027, with single-family and townhomes recovering first.
Ron says a recovery starts only when prices stop falling. Prices then plateau, perhaps for a year or two, before stabilization and real rebounds. He expects falling prices to continue through all or half of 2027. Recovery requires an end to the trade war, fuller employment, calmer buyer sentiment and some interest-rate relief. Pent-up demand is strongest for ground-based homes, so single-family and townhomes should recover first, then trade-up buyers, with condos lagging. He also cites 2028 as a rough recovery marker.
“And I see that that will probably continue either through the whole of '27 or through half of twenty seven.”at 32:30
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Big Canadian bank mortgage underwriting is unchanged, and developer defaults pose virtually no systemic risk.
Ron says he gets approvals from banks every day, and big Canadian banks' prime mortgage underwriting is no different from a year or five years ago, with no material tightening. On developers in distress in Metro Vancouver and Toronto, he says systemic risk is virtually none. He cites conversations with bankers who monitor the issue. Construction loans in Toronto are much larger, yet the outcome so far is satisfactory. Toronto has a functional market in which family offices and holding groups buy batches of unsold preconstruction condos and absorb developer debt. Vancouver lacks that buying, which he attributes to early days or higher prices.
“I will tell you there has been absolutely no material change in the underwriting of the big Canadian banks. ... Virtually none.”at 35:22
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Canada, Australia & other developed economies
Ontario's unsold developer condo inventory will clear over the next 12 to 18 months.
Ron says developers' unsold condo inventory is the most worrisome part of the market. He says that inventory is starting to clear in a way that will eventually stabilize things. The clearing is already visible in Toronto, where family offices and holding groups are buying 20 to 40 unsold preconstruction units at a time and absorbing the developer debt. He expects a similar clearing in Ontario over the next 12 to 18 months. Vancouver has not yet seen the same buying.
“But we're actually seeing what will eventually be a kind of clearing in the most worrisome inventory of unsold condos by developers. We're probably gonna see a clearing of that in Ontario over the next twelve to eighteen months.”at 36:55
The David Lin Report: Bond Market Crashes; Your Home Is Next | Ron Butler ·
Long-term bond yields worldwide will trend higher next year, pushing up mortgage rates.
Butler says fixed-income executives at major institutions in Canada and the US are very bearish on bond yields, especially long-term ones, which drive 25- and 30-year fixed mortgage rates in the US and bond yields in Canada. He says the yield trend is synchronised across the world, so the setup points to higher yields. He acknowledges the path won't be linear, with dips and jumps along the way, and that yields fell in recent sessions. But the highest-conviction view among those executives is that the trend next year will be higher.
“Their belief is, their highest conviction is, the trend next year will be higher.”at 7:29
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Adjustable-rate mortgage resets are not a big risk; ARMs remain a very small share of loans.
Butler says adjustable-rate products had their day just before the 2008 financial crisis, took a severe beating, and their use fell off a cliff. Even though their share is rising and more lenders market them, borrowers taking them are still a very small percentage of mortgage originations. He doesn't see the reset wave of around 3.1 million ARMs as a major issue.
“These adjustable products really had their day just prior to the two thousand eight financial crisis... the use of this product has just fell off a cliff.”at 8:07
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Locked-in sub-3% mortgages keep US sellers away, so the buyer shortage pushes home prices lower.
Butler says almost 40% of US mortgage holders still have rates around 3%. Those owners won't sell and take on a 7.15% mortgage, since moving would be economically irrational. That shortage of sellers has cut the number of listings, and the imbalance between sellers and buyers is large. Buyers are also staying on the sidelines because they expect rates to fall next year. With fewer buyers, sellers have to cut prices.
“Almost 40% of the market in The US, these mortgage holders still have a mortgage rate that looks like 3%. So if you have a mortgage rate that looks like three percent, you might be very, very, very reticent to sell your home.”at 12:17
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
US homebuilder activity tracks resale weakness and will get worse while rates stay high.
Butler says the decline in residential completions and the drop in homebuilder stocks are correlated with the resale slump. Builders can't get past high rates with any incentives, and buyers hold off, saying they will wait to see where mortgage rates go. That uncertainty and reticence weigh on new construction, so he expects it to get worse.
“They're absolutely correlated, and they're gonna get worse.”at 14:10
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Bank of Canada will raise rates, likely October 28 or December, to fight inflation.
Butler argues the Bank of Canada has one tool and one job, which is preventing inflation from getting out of control. Canada's inflation print was due the following Monday, and he thinks a good print is unlikely. The next print in November feeds into the December 9 meeting. Governor Macklem has moved from weak-economy talk to inflation talk, and central banks in the US, Japan and Europe have already raised rates. Butler reads this as signalling that a Bank of Canada hike is a matter of timing.
“And once he saw The US raise, the Bank of Japan raised, European Central Bank raised, He knows it's gonna happen, and it's just a question of when.”at 18:45
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Tiny Canadian condos are the most beaten-up real estate category and will lag any recovery.
Butler's 'dog crate' condos are under 500 square feet, often around 385 to 425 square feet, with poor layouts and weak buildings. They face falling prices, falling asking rents, rising property taxes, rising condo fees, and higher mortgage rates that will keep damaging them. He says they are the most beaten-up single category of Canadian real estate. Even after ground-based homes such as single-family houses and townhouses recover, the difficulties for tiny condos will continue for quite some time.
“It is certainly the most beat up single category of real estate in Canada.”at 20:00
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Ontario and BC rental-property owners should sell now, even at a substantial loss.
Butler says many Ontario rental properties now have negative cash flow while their values are falling. Canada has seen 24 straight months of lower asking rents, particularly in Ontario and British Columbia. Meanwhile property taxes, mortgage rates and monthly condo maintenance fees keep rising. Owners who are losing money every month and see values dropping should sell even if they take a large loss.
“People better get serious about selling these things even if they're gonna take a substantial loss.”at 21:11
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
US rents won't fall soon; with unemployment near 4%, landlords can keep raising rents.
Butler says the US economy is in good shape and shelter data is lagging. With unemployment only a little over 4% and plenty of people working, landlords can keep getting decent rent increases. There is no reason to cut rents while people are employed and the economy is moving. He doesn't expect rent deflation for months, which he links to the solid jobs market.
“These are always lagging numbers. And I would suggest to you that in The US, we won't see any sort of [rent] devolution for months.”at 21:57
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada's trade war threat is pressuring unemployment and weighing on housing demand; it must end.
Butler links Canada's job losses, including 68,000 jobs lost in September, to the threat of a trade war with the US. That pressure on employment weakens housing demand, since people without work can't buy homes and may move in with family. He says a resolution to the trade war is a precondition for a Canadian housing turnaround, alongside fuller employment, calmer conditions and some interest-rate relief.
“And the threat of the trade war in Canada puts a further pressure on unemployment, those job losses you talked about.”at 22:32
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Court-ordered foreclosure sales clear 8-10% below prior lows, creating new comps that push regional prices lower.
Butler says his team has tracked court-ordered and power-of-sale foreclosure sales and found each one closes about 8-10% below the lowest prior sale. Buyers bid as low as possible, and each sale becomes a new comparable, so the whole neighbourhood or region reprices lower. This has played out consistently for almost a year. Financial pressure has been grinding for a couple of years and looks set to last another year or two. Homeowners whose homes are worth less than the mortgage are increasingly tempted to stop paying and wait out the lender's process rent-free, so the number of forced sales grows and keeps pushing values down.
“...that sale is always between [8-]10% lower than the lowest previous sale...”at 26:40
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Ending the federal foreign-buyer ban won't lift Canadian home prices; there is virtually no buyer interest.
Butler says provinces are keeping their large taxes on foreign buyers, so removing the federal ban changes little. Foreign buyers have also declined, since most came from mainland China and the Chinese property market has collapsed. Buyers also avoid markets where they might catch a falling knife. He says there are no buyers queued for the January 1, 2027 expiry and that the belief otherwise is wishful thinking from real estate agents.
“Anyone who feels that the end of the federal homebuyers ban will cause an immediate upward movement in home prices, we we say that those people are smoking the hopium pipe.”at 30:11
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Canadian housing won't recover before 2028; prices must first stop falling, likely through 2027.
Butler says a housing recovery starts only when prices stop falling. Unlike stocks, real estate has no automatic rebound; prices may plateau for a year or two before stabilising and rising. He expects declines to continue through all or half of 2027, which puts a real recovery around 2028. He says sales volume must rise steadily in CMHC and industry data before a turn is confirmed, since falling 'for sale' signs can reflect sellers giving up rather than a real improvement. He expects single-family homes and townhouses to recover before condos.
“2028? I don't see any chance of... the downturn stops is the first thing. The first key factor is prices stop going down.”at 33:51
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Big Canadian banks' mortgage underwriting has not materially tightened; rules are unchanged from five years ago.
Butler is a principal mortgage broker who says his firm is getting new mortgage approvals from banks every day. He argues there has been no material change in the underwriting of the big Canadian banks. Underwriting is no different from a year ago or five years ago, with the same rules and no material tightening in underwriting approaches in Canada's prime mortgage space. Mortgage access therefore is not tightening despite the broader stress in the market.
“I will tell you there has been absolutely no material change in the underwriting of the big Canadian banks. It's no different today than it was a year ago than it was five years ago.”at 37:23
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Distressed Canadian condo developers pose virtually no systemic risk to the broader economy.
Asked how much systemic risk developers on the brink of default in Metro Vancouver and Toronto pose, Butler says virtually none. He cites conversations with people at banks in the group that monitors this, and says the construction loans for Toronto condos, though much larger in volume, are so far working out satisfactorily. He points to a functional Toronto market where family offices and financial holding groups buy 20, 30 or 40 unsold preconstruction condos at a time, relieving developers of their debt burden. Vancouver lacks that buying, which he attributes to it being early or prices being too high.
“Virtually none. ... And so far, it is working out satisfactorily. ... family offices and financial holding groups swooping in and buying 20, 30, 40 unsold preconstruction condos at a time and relieving... All of the debt burden from the developer.”at 39:03
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Canada, Australia & other developed economies
Ontario's unsold condo inventory will clear over the next twelve to eighteen months.
Butler expects that the most worrisome inventory of unsold condos held by developers will eventually be cleared through a market adjustment. He describes it as a kind of clearing in which he expects Ontario to see that clearing over the next twelve to eighteen months. This follows his view that Toronto's market is functional, with family offices absorbing unsold preconstruction units, while Vancouver is not seeing the same buying.
“the most worrisome inventory of unsold condos by developers. We're probably gonna see a clearing of that in Ontario over the next twelve to eighteen months.”at 40:04
The David Lin Report: Housing Crash Deepens: No Recovery Until 2028 | Ron Butler ·
Shows
- The David Lin Report · 2 episodes
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