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Thread: The Housing Market needs to crash.

  1. #31
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    I'm looking in York and East York now. East End of the former city as well. York is cheap for the most part. East York I having a bit of trouble.


  2. #32

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    Quote Originally Posted by Hipster Duck View Post
    But what drives demand, if not demographics?
    Well, the ready availability of a large pool of decent, recently built, rent-controlled, multi-unit rental housing stock kept many of us out of the housing market in the '70s and '80s even though we were the sort of huge demographic group I think you're talking about.

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    ^Back then, very few of you had kids, so there was no impetus to move into a house. The large pool of decent, recently-built, rent-controlled, multi-unit rental housing stock that was built precisely because of the demand generated by the requirements of your demographic group at the time did very nicely.

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    Quote Originally Posted by Hipster Duck View Post
    This is the best advice that anyone can give a new entrant to the housing market.

    I would only add one thing: when it comes to housing market predictions - an imperfect science if there ever was one - we should listen to economists less and demographers more. You cannot predict how the Bank of Canada is going to set interest rates over the next 15 years, but you can predict, with a little more accuracy, where certain cohorts are going to wind up and what they're going to do with the homes they own.

    Baby boomers might be holding on to larger, more central homes now (especially if they're asset rich and cash poor), but in 15 years many of them will simply be too old and infirm (and some of them even dead) to stay put and many will put their homes on the market. Just wait it out.
    Hipster - you really should work with an agent who can help educate you on reality.

  5. #35

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    Too many 'youngins' jumping in the market for the sake of 'owning' don't do the actual calculations of affordability and value for money.

    For those comparing the current trend to the 'good old days' we have to remeber that there where a lot less demand. Our demographic may not have doubled but housing demand may possibly have.

    If you take a look at the basic 4 person baby boomer family that used to live under 1 roof, their kids are now in their 20's and eager to move out. All of a suden , the same amount of people require double the housing requirememt (if not triple if the kids live by themselves and don't move in with roomates/partners). That's partly were demand will easily outstrip population growth.

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    Quote Originally Posted by Toronto Rocks View Post
    Hipster - you really should work with an agent who can help educate you on reality.
    Uh, can you elaborate on what you mean by "reality" here? Also, how would a real estate agent inform me about long-range economic or demographic trends?

    If you take a look at the basic 4 person baby boomer family that used to live under 1 roof, their kids are now in their 20's and eager to move out. All of a suden , the same amount of people require double the housing requirememt (if not triple if the kids live by themselves and don't move in with roomates/partners). That's partly were demand will easily outstrip population growth.
    Right. But what about when baby boomers themselves grew up and began leaving homes in a similar fashion in the 1970s? Back then there would have been even more of them (usually 3-4 kids in a household).
    Last edited by Hipster Duck; 2012-May-03 at 19:00.

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    Requesting a crash (as per your first post in this thread) only shows how entitled you feel you are.
    Nobody owes you anything (not even Mommy and Daddy).
    If you really want to get educated than a good real agent and a good mortgage broker, will help educated you.

  8. #38
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    Quote Originally Posted by Toronto Rocks View Post
    Requesting a crash (as per your first post in this thread) only shows how entitled you feel you are.
    Nobody owes you anything (not even Mommy and Daddy).
    If you really want to get educated than a good real agent and a good mortgage broker, will help educated you.
    What makes you think I am entitled? I just want to own a home. I work and everything.

  9. #39

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    Quote Originally Posted by denfromoakvillemilton View Post
    What makes you think I am entitled? I just want to own a home. I work and everything.
    If you think you can buy a house right after graduation, then you consider yourself entitled to get one. But market says otherwise. The market hasn't really been that affordable for ages. Many have to rent after graduation and work to save money. Otherwise they feed off their parents even after graduation to save up so they can buy a home. Unless your parents are rich and buy you one, chances are, you aren't going to get one after graduation. Even with the market dip in the late 80's and early 90's; With the wage at the time. I don't think fresh grads could have bought a house after graduation. Fresh grads, unless they paid their own tuition have to pay off OSAP even. I like probably many others had to work through high school and university to pay off tuition and save up. Even then, there's a decade of working to earn enough to purchase a home. It's not 1950's anymore. Movie tickets doesn't cost 10 cents.

  10. #40
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    http://www.cbc.ca/news/canada/story/...r-housing.html

    On the surface, new data from real estate boards in the two markets shows prices for resale homes are indeed still rising. In Toronto, the average price of a resale home was $517,556 in April — an 8.5 per cent increase from the same month a year earlier.

  11. #41
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    The following article in the Toronto Star today touches on this issue as well.

    http://www.moneyville.ca/article/117...us-in-gta?bn=1

    GTA detached home sales jump in April

    Detached homes are becoming so “precious” as the GTA continues to surge skyward, it’s going to become increasingly difficult for families to find, let afford, the Holy Grail of housing — a place that isn’t attached to the neighbour’s.

    Demand is so strong for that shrinking share of the region’s housing stock, that sales of detached homes jumped 22 per cent across the GTA in April. The strong sales of those higher-priced homes helped push up the average price of homes (including condos, semis and detached) to $517,556 across the region — some 8.5 per cent higher than April of 2011, according to statistics from the Toronto Real Estate Board (TREB.)

    “The single family detached home is the most precious — they are always going to be the bonus houses,” especially given the limited supply in Toronto and the fact condos continue to far outpace new home construction across the GTA, says realtor and board president Richard Silver.

    A strong supply of new units coming on the condo market kept annual price growth to an average of 4 per cent, according to TREB statistics. But the continuing low inventory of houses for sale, and strong demand for higher-priced detached homes in particular, resulted in a 9 per cent price increase in April over a year earlier.

    Detached homes sold for an average of $831,214 the 416 region in April, compared to $579,278 in the 905 regions.

    Condo prices averaged $360,807 in the 416 region in April, up just 3 per cent from a year earlier, compared to a 7 per cent jump, to $289,819, in the 905 regions.

    The statistics show the impact of provincial greenbelt policies that, while effective in drastically reducing costly sprawl, have seen the housing market shift dramatically over just the last decade, says George Carras, president of RealNet Canada Inc. which tracks all new housing construction across the GTA.

    The explosion of condo development has actually seen the proportion of detached homes across the GTA slip to 59 per cent as of 2006 from 69.4 per cent of the total housing stock in 1991. And that number is expected to have dropped considerably when the 2011 census figures on housing are eventually made public because so much condo construction has happened in the last six years, far outstripping the creation of low-rise housing, says Jason Mercer, senior market analyst for TREB.

    Just one new house is being built for every three condos now — it used to be one condo to every three houses just a decade ago — and that dwindling supply of homes, in the face of increasing immigration and demand, is contributing significantly to price escalations for low-rise homes, says Carras.

    At the same time, at least one study has shown that just 20 per cent of Baby Boomers, the first wave of whom are nearing retirement age, have any intention of downsizing and putting their homes up for sale, he adds.

    “Baby boomers are becoming a major force in this market. The majority of (detached) homes are owned by a demographic that really doesn’t want to move, which is causing a bit of a supply shortage.”

    Veteran ReMax realtor Tom Cook said he’s seeing another issue contributing to the shortage of house listings: Homeowners who bought in the last decade but have seen their incomes lag well behind house price escalations.

    While their homes may be worth far more on paper, at least, than a decade ago, they haven’t had the added income to pay down the mortgage, which means they can’t afford to list and move up.

  12. #42

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    The large amount of rentable ( and, later, rent controlled ), decent, multi-unit, residential housing stock didn't suddenly appear in 1970 to celebrate the fact that the first boomers were turning 25. It was part and parcel of Toronto's post-WW2 boom, and 'rental' reflected a feature of the way families and singles lived, and Boomers were brought up, in the two decades before a few first condominiums were built on the outskirts of Toronto in 1968. The article suggests that Boomers aren't going to dump the traditional housing stock that we own onto the market en masse any time soon, and that fits in nicely with what my friends are doing. Some have downsized to condos, to be sure, but many are adapting their existing homes to see them through to the end!

  13. #43
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    Quote Originally Posted by James View Post

    http://www.moneyville.ca/article/117...us-in-gta?bn=1

    Veteran ReMax realtor Tom Cook said he’s seeing another issue contributing to the shortage of house listings: Homeowners who bought in the last decade but have seen their incomes lag well behind house price escalations.

    While their homes may be worth far more on paper, at least, than a decade ago, they haven’t had the added income to pay down the mortgage, which means they can’t afford to list and move up.
    major problem indeed, which exemplifies why the market is overpriced

  14. Default

    do u even have a job?? did ur parents pay for your school???

    if u were serious about saving money to buy a home you would live at home as long as possible(like they do in asia) or live with a bunch of roommates...

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    wishing for a crash is immature - it would be ecomically devestating - have you not read about the US/Ireland/Spain? I have relatives in the US who have been personally impacted - its not pretty.

    I am sympathetic to the fact that housing is so expensive and your desire to have a house, but a crash isn't the solution.
    I think you need to ask yourself why you want to buy at this age. Renting is not throwing away money -renting is cheaper than owning and you can use the excess funds to contribute to RRSPs/TFSAs and build up investmetn savings. You just need to be disciplined about saving -if your employer offers a group rrsp - sign up -its an easy way to save.

    I think you also have to ask yourself is owning a house realistic for at this time in your life in terms of job/career etc. How secure is your job? Do you expect to have one for the next five years? (typical mortgage period)? What happens if you need to move for a job?. What happens if you decide to go back to school (a lot of my friends after a couple of years of working went back to school for post-graduate degrees). Selling costs are quite expensive

    I'm in my mid-forties - all of my friends including myself when we finished school moved out and rented - starting off with bachelors/ or sharing, eventually moving to up to one bedrooms apartments and then finally saved enough money for a down payment on a house/condo. This was on average a 10 year process. None of us got our dream house or necessarily got our dream location - you quickly realize when looking for a house, even then, its impossible to get everything on your wishlist (unless you have unlimited funds) but I think we're all happy with our purchases - some of us bought condos; some of us bought homes depending on our lifestyle needs and what we could afford.

    PErhaps you can speed it up by living at home and saving or if your parents have money and can help you with the purchase (but please don't ask them to go into debt for you on the basis this is a good investment) this could jepardize their own financial security

    Buying a house is more than just the price. How much of down payment do you have and how much do need to purchase the house you want? Have you budgeted for maintenance costs? Are you prepared to do the other chores - shoveling show; gardening in summer; mowing the lawn.

    25 year amortization period is not unreasonable. Remember the longer the amortization period, the more interest you pay in the long run, even if your monthly payments are smaller. You will end up substantially increasing your housing costs.

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