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Baby, we got a bubble!?

Dan

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Below is the Toronto Real Estate Boards numbers for the GTA for August.

GTA REALTORS® Report Monthly Resale Housing Figures
TORONTO, September 3, 2010 ‐ Greater Toronto REALTORS® reported 6,232 sales
through the Multiple Listing Service® (MLS®) in August 2010.
This represented a 22 per cent decrease compared to the 8,035 sales recorded during
the same period in 2009. New listings decreased by one per cent year-over-year to
10,488.
“The prospect of interest rate hikes and new mortgage lending rules prompted some
households to purchase a home sooner than they otherwise would have this year. The
result has been a larger than normal dip in sales over the summer months. With this
said, it is important to recognize that sales on the year were eight per cent higher than
in 2009,” said Toronto Real Estate Board President Bill Johnston.
The average price for August transactions was $411,012 – up six per cent compared to
the average of $387,921 reported in August 2009.
“Market conditions have remained tight enough to support higher home prices in
comparison to last year. Under current mortgage lending standards, a household
earning the average income in the GTA can comfortably afford the mortgage payments
on an average priced home. Market conditions and the affordability picture would have
to change dramatically before a sustained drop in the average selling price would take
place,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
Housing Charts Continue…
 

David2144

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Highland Creek

Wow the market really is cooling down... :


http://www.realtor.ca/propertyDetails.aspx?propertyId=9900548&PidKey=-624522724
This house on Zaph Avenue in Highland Creek originally listed for $749,900 about 2 months ago,
It got re-listed yesterday with a new price of $699,900 .

Hopefully the market would continue cooling down because there are some stupid people that are waiting in line to buy new houses as if they are being sold for a huge discount... People need to wake up and realize just how much money they are spending.

And I hope interest rates rise.
 

lafard

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cdr108

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Here's a graph which might help: click here


from that graph, prices seem to peak in May annually and drop off up to August, during which time it drops b/t $10-15K during those few months.
(the anomoly being 2009)

during the 'recession' of 2008, prices dropped from May to August ($340K to $320K) .

so far in 2010, the price drop from May to August is following a similar pattern ($380K to <$360K?)
 

interested

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hey Urban dreamer.
I am pleased the drop was not as drastic as you predicted though worse than the 1 to 2% month on month I did. In fact it appears like about 2 and 1/4% drop in price. The drop in sales fell around the middle of both of us.

Still, this is striking regarding the price drop. The graph posted by Kenny /lafard is really helpful. Very telling. It appears the graph is 1 month behind and I realize it is median prices and not average prices but if we project the median down by 2% (assuming a similar drop to the average drop or about $10000) we are now probably below the Oct 2009 peak last year and approaching the starting point of this year.

If $10000/month on average price continues, by year end within the past 6 months (June to Dec 2010) prices will give up about $60000 and will be back to 2007/2008 prices. This is alot of people's paper equity being erased rather rapidly.
 

cdr108

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If $10000/month on average price continues, by year end within the past 6 months (June to Dec 2010) prices will give up about $60000 and will be back to 2007/2008 prices. This is alot of people's paper equity being erased rather rapidly.


but but but the realtor told me that prices ALWAYS go up and if i didn't buy ASAP, i would be priced out forever !?!
 

BobBob

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We had a slight drop in prices between July and August this year, as has happened almost every year. I don't see what's striking about that - unless you are struck by the non-strikingness of it all.

What will be striking is if declines continue through the next few months, which have typically seen a boost peaking in October most years.
 

Kenny

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from that graph, prices seem to peak in May annually and drop off up to August, during which time it drops b/t $10-15K during those few months.
(the anomoly being 2009)

during the 'recession' of 2008, prices dropped from May to August ($340K to $320K) .

so far in 2010, the price drop from May to August is following a similar pattern ($380K to <$360K?)

FYI (not that it changes anything), the graph is missing the new August numbers: median price of $358K
 
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Kenny

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We had a slight drop in prices between July and August this year, as has happened almost every year. I don't see what's striking about that - unless you are struck by the non-strikingness of it all.

This is the more striking graph: click here

(note: missing August numbers: 6232)
 
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interested

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We had a slight drop in prices between July and August this year, as has happened almost every year. I don't see what's striking about that - unless you are struck by the non-strikingness of it all.

What will be striking is if declines continue through the next few months, which have typically seen a boost peaking in October most years.

I would suggest that it is already striking. If you compare even median sale prices for 2007, 2008 and 2009 to 2010, the thing to note is that in 2009, the drop started a couple of months later and the pitch of the descent is much slower. Similar with 2007 and 2008. The 2010 is dropping at a much faster rate and started early. As you say, if it continues in the next few months, that will just be more striking in my view.

the other issue is that prices peaked last year in Oct and we are almost back to that peak for median price. Perhaps it will go up but everything you read about the economy in general etc. does not make for an environment to bid up prices. At best, hold the line but as most here seem to believe, a steady downward decline.

We shall see.
 

Ontariolandlord

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Respectfully, I too would have to disagree. There are many more headwinds and I just don't believe that the simple elimination of the Toronto Land Transfer tax would be enough to offset all the negatives. Of course that would help.

Anyhow, first Rob Ford has to win and politics have a way of changing day to day. And then, let's see if it is a promise that is kept. As well, the mayor can't do it on his own. He is but one vote. There is already alot of talk of a dysfunctional and shadow cabinet by some left leaning councillors who say(whether they do it or not or are reelected - who knows) they will not support alot of Ford's iniatives.

Fair enough and a good post.

The end of the land transfer tax won't save the day. However, it WILL help.

And you'd be surprised at how much pull the Mayor has.

I don't support anyone in particular. I do care about the RE market and with rates set to rise we need all the help we can get.

Have a great long week-end!
 

cdr108

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Fair enough and a good post.

The end of the land transfer tax won't save the day. However, it WILL help.

And you'd be surprised at how much pull the Mayor has.

I don't support anyone in particular. I do care about the RE market and with rates set to rise we need all the help we can get.

Have a great long week-end!


then you should be calling for lower prices as that will support the RE market for the long-term when rates go back up to the long-term average.
 

Condo George

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Back from Oasis of the Seas cruise, a must do if you enjoy cruising.......

So with all the forecasts of 15% here and there should I expect the same drop in this area? Real Estate is a very localized market folks, if we go down 15% in Sudbury doesnt mean we go down at the base of the CN Tower, we may even go up!

I represented Mr. Rupoli here at Maple Leaf Square, pls have a read


http://www.thestar.com/yourhome/rea...6--downtown-condo-has-amenities-to-drool-over


Also ESPN article.....

http://www.toile.com/next/go/?NjA5N...5JTJGMDMlMkYxNTI0MjQ1Ni5odG1sOjEyODM2NDQ4MDA=
 

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