You'd have to define "bubble". There's quite a few definitions out there, and for one of the most popular understandings "All bubbles must burst". Except most don't.Time for another round of "are we in a bubble or not"...
Toronto, Vancouver among biggest property bubbles in the world, UBS says
You just made my point. Ditto Oz house prices. Oz in fact was being used as a case in teaching economics of the Market going "sideways" for almost a decade last "crash". With Inflation, that meant static prices were slowly receding in terms of buying power.they've been saying that for a long while about hk. interesting enough, prices there might be dropping.
https://www.smartcompany.com.au/industries/property/harry-dent-predicting-australian-house-prices-will-crash/There are always bubblers and doomsayers around predicting the bursting of Australia’s property bubble.
But recently US demographer Harry Dent has been travelling around the countrytelling anyone who’ll listen to him that we’re on the verge of an economic winter and when it comes, the fallout could be worse than even the Great Depression of 1929.
I had a chance to interview Dent, one of the world’s most controversial economists, on my podcast and hear him predict that the stock market could possibly crash 80% just weeks or months from now, and that our property markets will also eventually crash, with Sydney real estate house prices likely to drop by as much as 40%.
Dent comes to Australia every couple of years, usually when he has a new book to promote (as he does this time), throws the cat amongst the pigeons by predicting Armageddon, and in the process gets lots of publicity for his books and seminars.
Only last night my sister, who knows little about property asked me: “Is the value of my house really going to drop 40%? I heard some American guru on TV say that’s what’s going to happen”.
So, is Dent right this time? Are we in for a property market collapse?
I’ll try and answer this with a Q&A.
You’ve only lost if you sell at the low point in the market. Housing pricing will continue rising over the long term.I think it's really hard to tell at the moment. You certainly wouldn't have trouble off-loading property in central Toronto for a satisfying price at the moment but I know some people who bought peak in suburban sub-markets that have lost hundreds of thousands but are renting out the properties at the moment in a wait-and-see mode.
https://www.abc.net.au/news/2018-06-27/china-ghost-cities-show-growth-driven-by-debt/9912186Fancy villas, high-rise apartment blocks, lakes, parks and sprawling road networks: Ghost cities in China have it all. Just one crucial element is missing — the people.
There may be as many as 64 million empty apartments in China
Many people buy the properties as an investment with no intention of ever moving in
Author says ghost cities show growth is driven by debt in China
Built for a population that never came, about 50 of these surreal sites lay desolate across the country. But still the construction continues.
These new cities are usually built in rural areas on the outskirts of existing cities.
Designed for populations numbering in the hundreds of thousands, the mass construction projects can include towering high-rise condominiums, huge shopping centres, city squares, street lights and replicas of cities in Europe and elsewhere.
A replica Eiffel Tower stands next to apartment towers.
PHOTO: The Yitian Eiffel is one of at least three replica Eiffel Towers in China. (Supplied: J Capital Research)
Dinny McMahon, author of China's Great Wall of Debt, explained the driving force behind the new construction projects, seemingly built for no-one.
"The phenomenon very much has been driven by the debt splurge that really kicked into gear after the global financial crisis," Mr McMahon said.
"Local governments around the country tried to juice and stimulate their economies by building more infrastructure and stimulating the property market."
This seemingly wasteful construction is carried out by both state-owned firms and private companies
That in itself won't lead to a collapse in prices because many of those units are trapped in places people do not want to live. Its not true supply, thye are wasted assets.^I think if you look into the situation in China, many of the empty units are in *empty cities*...built by a 'command economy' rather than a 'demand economy'.
Wouldn't that be up to the market to decide?That in itself won't lead to a collapse in prices because many of those units are trapped in places people do not want to live. Its not true supply, thye are wasted assets.
You've missed both sides of the equation: It's neither supply or demand. Supply, for market forces to pertain, must be viable for the demand, and demand, for the supply.That in itself won't lead to a collapse in prices because many of those units are trapped in places people do not want to live. Its not true supply, thye are wasted assets.
Ostensibly based on this one:Wasn't there an estimate a year back that 100K Toronto condos were vacant?
https://www.theglobeandmail.com/news/toronto/toronto-mayor-tory-open-to-vacant-house-tax-on-speculators/article34491369/JEFF GRAY TORONTO CITY HALL REPORTER (Globe and Mail)
PUBLISHED MARCH 30, 2017
UPDATED APRIL 15, 2017
Toronto Mayor John Tory says he is open to following Vancouver's lead by imposing a tax on vacant homes to crack down on speculators, as pressure mounts on governments of all levels to rein in the runaway real estate market.
"Vancouver recently implemented a vacant-home tax. And I am open to exploring whether this would be the right measure for Toronto," Mr. Tory told reporters on Thursday after a closed-door meeting with housing experts that he convened to discuss the city's accelerating affordability crisis.
"I look at housing as a place to live for people in this city," Mr. Tory said. "That is what I view as my responsibility, not to look after the investment needs of people who chose real estate as their investment target. They'll look after themselves."
The idea comes amid continued warnings that Toronto's real estate market, where the average price of a detached single-family home is $1.6-million, is a bubble waiting to burst. [...]
Anyone care to reference a more recent and *reputable* figure before continuing this line of discussion?But whether a vacancy tax would do much to contain spiralling house prices in Canada's largest city remains unclear. While anecdotes about "dark condos" and oddly empty luxury homes are common, little reliable data exist on just how many empty units speculators are sitting on in Toronto. The mayor says the only estimate he has seen puts the number of vacant units at 65,000.
That number comes from census data, meaning that owners at those addresses did not answer their doors on census day or on two follow-up visits over the next six months. Mr. Tory said city officials will now start using Toronto Hydro and Toronto Water data to try to refine the number of truly vacant units and produce a report on the feasibility of a vacancy tax.
Mr. Tory would not say what rate could be charged, or how the tax could be implemented. No details were discussed, he said, and the idea is at a "preliminary stage." His staff said Toronto would likely need provincial permission to impose a vacancy tax.