X2 Buyer
Active Member
do not know if anybody posted this article yet. just in case no one
Canadian Housing: Booming Rebound, No Bubble
Canadian Housing: Booming Rebound, No Bubble
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Baby, we got a bubble!?
- Thread starter simuls
- Start date
Shtopor
New Member
Almost 70% of all Canadians own a house or owing on one.
We have 20% of households living on after tax incomes of less then 1000CAD
Another 20% making less then 2500 CAD.
So, ladies and gentlemen, We have a situation when not just an "Average " all in, but quite a bit of those who are "Below Average" all in too.
BUT, still no bubble, cough... cough...
We have 20% of households living on after tax incomes of less then 1000CAD
Another 20% making less then 2500 CAD.
So, ladies and gentlemen, We have a situation when not just an "Average " all in, but quite a bit of those who are "Below Average" all in too.
BUT, still no bubble, cough... cough...
Kenny
Active Member
X2 Buyer
Active Member
What I understand, not the $ of price but the % of increase is 3.4% below year-ago level.
X2 Buyer
Active Member
Summary of the article - yes the housing price income ratio is at record high now pt 3 above, but you cannot simply take that to determine bubble by overlook the other 3 points.
Personally I am not buying into any of the analysis or conclusion (either side) - only the charts and stats can be possibly useful with a hope the source of the data is accountable
Eug
Senior Member
"David Rosenberg is chief strategist for Gluskin Sheff + Associates Inc. and a guest columnist for Report on Business"
Floating high on a delicate housing bubble
"Looking at Canadian home prices in relation to personal incomes or residential rent, what we have found is that housing values are anywhere between 15 per cent and 35 per cent above levels we would label as being consistent with the fundamentals. If being 15-per-cent to 35-per-cent overvalued isn't a bubble, then it's the next closest thing."
I guess it depends on where he's talking about. I wouldn't be surprised if Toronto dropped by 10-15% in a real estate downturn, and more in places like Vancouver.
However, I don't think such a drop is assured either.
Floating high on a delicate housing bubble
"Looking at Canadian home prices in relation to personal incomes or residential rent, what we have found is that housing values are anywhere between 15 per cent and 35 per cent above levels we would label as being consistent with the fundamentals. If being 15-per-cent to 35-per-cent overvalued isn't a bubble, then it's the next closest thing."
I guess it depends on where he's talking about. I wouldn't be surprised if Toronto dropped by 10-15% in a real estate downturn, and more in places like Vancouver.
However, I don't think such a drop is assured either.
daveto
Active Member
Canadian housing prices are more expensive now than when the US prices peaked a couple of years ago. We have the same urban vs rural distributions, and indeed their per capita income is higher.
So if Canada's housing prices are not in a bubble now, does that mean the US prices were not in a bubble two years ago?
I'm not answering this question myself -I'm posing it to those who disagree that our prices are inflated beyond a price warranted by fundamentals and supported by a speculative belief in continuing asset price increases. (ie a bubble)
So if Canada's housing prices are not in a bubble now, does that mean the US prices were not in a bubble two years ago?
I'm not answering this question myself -I'm posing it to those who disagree that our prices are inflated beyond a price warranted by fundamentals and supported by a speculative belief in continuing asset price increases. (ie a bubble)
Eug
Senior Member
In terms of location and rush hour commute times to downtown, lot size, home size, and safeness of the neighbourhood, NY still seems noticeably more expensive than Toronto does even now.
Miami seems less expensive though.
Therion
Senior Member
I don't think a 15-20% drop is unreasonable or unexpected. Stocks drop by more all the time. I know real estate isn't supposed to be as volatile, but that thinking was pretty much washed away in the sea of cheap money the global crisis has unleashed. The crisis which was created by cheap money fuelling real estate booms. Lesson: unlearnt.
daveto
Active Member
BrianPersaud
Active Member
I'll be interviewing Shaun Hildenbrand from CMHC for Inside Toronto Real Estate on Wednesday December 23rd at 8:30p on Rogers TV. He'll discuss CMHC's analysis on the rental report and bubble scenarios with hard numbers. As of today's date, the findings cannot be reported to the general public.
Email insidetorealestate@rogerstv.com to get your questions in ahead of time.
I'd like to read that remax report, because it contradicts another report published by remax here
Email insidetorealestate@rogerstv.com to get your questions in ahead of time.
I'd like to read that remax report, because it contradicts another report published by remax here
Eug
Senior Member
Who said New York and Toronto are comparable? I said New York is more expensive, which it is. I did not say Toronto should be the same price as New York, and it isn't.
Or are you suggesting New York is in a bubble right now too, and its cost premium over Toronto is not justified?
The Condo Observer
Active Member
I think we are in the midst of a process that sees Toronto "finding its own new level", in terms of economic activity, urban development, real estate etc etc. Its an unpredictable process where we are establishing a "new normal", and we are trying to evaluate it based on our prior understanding of everything that has happened in the past. The fundamentals have changed, demographics have changed....its just a new paradigm.
We are all keen observers of this city, and we are all very opinionated and have something to say. But take stock, and think back twenty, ten years. This city is nothing like it used to be. The condo boom has brought people back to the city, amenities are improving, services are multiplying, its just a new reality for our city.
But back to the bubble issue...its being fueled by cheap money and low supply. The central bankers are not asleep! Things will normalize when interest rates start to move up, and sellers who were on hold decide to list their properties.
We are all keen observers of this city, and we are all very opinionated and have something to say. But take stock, and think back twenty, ten years. This city is nothing like it used to be. The condo boom has brought people back to the city, amenities are improving, services are multiplying, its just a new reality for our city.
But back to the bubble issue...its being fueled by cheap money and low supply. The central bankers are not asleep! Things will normalize when interest rates start to move up, and sellers who were on hold decide to list their properties.
daveto
Active Member
Eug
Senior Member
I thought it was obvious, but I'll explain it.
Toronto shouldn't be expected to be as expensive as New York, and guess what? It isn't. In that context, perhaps the pricing for Toronto (a large metropolitan and multicultural city, and financial centre of Canada) is in fact relatively appropriate, as places like New York are still much more expensive even after the US real estate crash.
That said, I think there is room for Toronto to drop, but I don't necessarily agree with the assumption by some that the Canadian real estate market's sky-is-falling.
Personally, I'm predicting a mild to modest drop in absolute dollar pricing in the coming years, which may be a little less modest after considering inflation, but I think it's a bit odd to consider this a sure thing, especially since people have been telling us since the early to mid 2000s that an imminent big crash was a sure thing in Canada.
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