interested
Senior Member
Might I suggest we pursue the logic of this a step further Ka1?
If interest rates stay down, building continues, and rents stay where they are(as they have for the past 10 years) why would prices continue to rise. I say this because if interest rates stay as low as they are for say the next 5-10 years, it is because the economy remains weak and cheap money is there to stimulate it. But if the economy is weak, where are the new jobs, where are the pay increases to justify any further price increase, where is the hope that things will get better to drive up prices. Who will be immigrating to the GTA if no new jobs or few are being created.
Who will bid up prices? Foreigners because in this scenario with no positive outlook factors for the GTA, who will see this as a place to invest to make money?
I appreciate you say market prices will move sideways/steady/slightly downwards and not "upwards" as I asked in the upper paragraph but if this plays out, does not at some point the investor pull out his money to invest in something he can make money at and will that not result in downward price pressure?
If on the other hand interest rates go up, then should not prices go down unless there is enough foreign money to offset all those locally and other investors who are marginal who could not handle a 2-3% or more interest rate increase?
In other words, unless we continue in a state of flux, with no improvement or "disimprovement" presumably something would have to eventually give one way or the other.
If interest rates stay down, building continues, and rents stay where they are(as they have for the past 10 years) why would prices continue to rise. I say this because if interest rates stay as low as they are for say the next 5-10 years, it is because the economy remains weak and cheap money is there to stimulate it. But if the economy is weak, where are the new jobs, where are the pay increases to justify any further price increase, where is the hope that things will get better to drive up prices. Who will be immigrating to the GTA if no new jobs or few are being created.
Who will bid up prices? Foreigners because in this scenario with no positive outlook factors for the GTA, who will see this as a place to invest to make money?
I appreciate you say market prices will move sideways/steady/slightly downwards and not "upwards" as I asked in the upper paragraph but if this plays out, does not at some point the investor pull out his money to invest in something he can make money at and will that not result in downward price pressure?
If on the other hand interest rates go up, then should not prices go down unless there is enough foreign money to offset all those locally and other investors who are marginal who could not handle a 2-3% or more interest rate increase?
In other words, unless we continue in a state of flux, with no improvement or "disimprovement" presumably something would have to eventually give one way or the other.
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