Baby, we got a bubble!?

[js97]

I don't even know where to start, but you seem to be very ill-informed...

and to be clear, I'm not 'bullish' on the market, but I'm just pointing out that a flat-lining of the market is much more likely scenario, vs this drastic drop you speak of.


And to further clarify things, I'm speaking about major cities market, and SFH's.

Curious, are you invested in the market? or just another spectator, waiting on the sidelines (for the past decade), and hoping to 'get in cheap'?

Here's a summary, I'm hilighting some very significant drivers including:

1. Babyboomer downpayments for double income couples (in the 150k+) - first hand experience, across Jews, Asians, Arabics and Anglosaxons canadians.

2. Foreign cash - it's a factor - where else would you 'park your cash'?

3. Perceived low interest rates in the midterm - including 10yr fixed at 4 %

4. Historic analysis - even in the 18% rates of the late 1980's, markets only dropped 20% , and it took over 4 years to do so.

And I'm not actually advocating condos, I think those prices will adjust, slightly, but I'm simply looking at all those couples that are inhabited by urban professionals (Liberty Village, Esplanade, etc etc,)that will eventually want a home. Where do you think all that money is going?

And thank you very much for your concern, but my next home 'upgrade' has a 7+ figure price tag, so I'm not actually 'trapped by any means. Especially when it's a renovated detached in one of the most desirable neighbourhoods in the city. But hey, you obviously don't have all the facts. Oh, and yes, i have rents that generate positive cash flow, even if interest rates hit 10%. So I think I know what I'm doing.

 

[recharts]

I don't even know where to start, but your posts are obviously so ill-informed...

and to be clear, I'm not 'bullish' on the market, but I'm just pointing out that a flat-lining of the market is much more likely scenario, vs this drastic drop you speak of.


And to further clarify things, I'm speaking about major cities market, and SFH's

Curious, are you invested in the market? or just another spectator, waiting in the sidelines (for the past decade), and hoping to 'get in cheap'?

Here's a summary, I'm hilighting some very significant drivers including:

1. Babyboomer downpayments for double income couples (in the 150k+) - first hand experience, across Jews, Asians, Arabics and Anglosaxons canadians.

2. Foreign cash - it's a factor - where else would you 'park your cash'?

3. Perceived low interest rates in the midterm - including 10yr fixed at 4 %

4. Historic analysis - even in the 18% rates of the late 1980's, markets only dropped 20% , and it took over 4 years to do so.

And I'm not actually advocating condos, I think those prices will adjust, slightly, but I'm simply looking at all those units inhabited by urban professionals (Liberty Village, Esplanade, etc etc,)that will eventually want a home. Where do you think all that money is going?

And thank you very much for your concern, but my next home 'upgrade' has a 7+ figure price tag, so I'm not actually 'trapped by any means. Especially when it's a renovated detached in one of the most desirable neighbourhoods in the city. But hey, you obviously don't have all the facts. Oh, and yes, i have rents that generate positive cash flow, even if interest rates hit 10%. So I think I know what I'm doing.

1. you are clearly delusional. Most of the baby boomers you are mentioning are not able to retire propelry, still carrying a mortgage The internet os full of stats on this
2. I just pointed you to US but you are so full of ... that you ignored my reply. You are wasting my time
3. you are ignoring the facts: SALES ARE DOWN. No matter what is happening with the prices AND people's preception on credit THEY ARE NOT TAKING ANY MORE CREDIT. Again I am wasting my time with you.
4. If you refer to Canada's history (1980) that is so old that you can display it in a museum Today's Canada is not the 1980's Canada anymore. Get that your head. Since you advanced this wishful thinking theory would you mind supporting that with evidences dating back to no longer than 10 years ago ? An let me tell you something, do not count on the average numbers shown to you by high stats. Dive into the area where you own and see what is going there and around.

5 You are doing too good to be true. You are clearly showing off


Edit:
Are these your friends?

http://urbantoronto.ca/forum/showthread.php/10523-Baby-we-got-a-bubble!?p=729211#post729211

you are full of crap excuse me for saying so. and I suspect that your underwear is full of it as well in these market conditions.
I am done with you no more comments.
You are clearly and exactly the victims of the government sponsored idiocy that started in 2008.
There is many like you and they are in trouble right now. Not sure if stupidity or greediness should be blamed in the case of all these investors.

 

[js97]

I can't even read what you're saying. Sounds like you're going to blow a gasket trying to convince me of real estate catastrophe.
Yes, sales are down, but from record highs. So I actually think this is a good thing in cooling the market.
Yes, sale prices have been less than listing, but how do they compare to the previous year?

From the sounds of it, you've obviously been watching from the sidelines - perhaps you're the one with a pipedream?


And to be clear, I'm mostly referring to the Toronto market, not averages across the country. During the US crash, major cities like NYC, SFO, LA and CHI did not go through the same price adjustment as the rest of the country. So why would you think Toronto/Vancouver would? Although I think Vancouver is definitely overpriced, will it go through a drastic correction? That's debatable.

 

[Kenny]

I can't even read what you're saying. Sounds like you're going to blow a gasket trying to convince me of real estate catastrophe.

Some people are so invested in their own opinion that they're incapable of having a rational conversation. I had the same issues when I tried to talk to my mom about religion.

 

[chwong]

Some people are so invested in their own opinion that they're incapable of having a rational conversation. I had the same issues when I tried to talk to my mom about religion.

I totally agree, that's why I refused to respond to this recharts.

 

[Pitz]

I totally agree, that's why I refused to respond to this recharts.

He goes under a different nickname in another major canadian forum and with the same agenda : push the end of days. And if you question any of his posts he immediately attacks you, calls you ignorant, etc, etc, etc. It is impossible to have a mature conversation with recharts as he will always praise any geniuses that agree with him or unleash his anger against those who dare to ask "why is that?".

 

[KA1]

http://www.theglobeandmail.com/glob...be-good-news-for-real-estate/article12171482/

 

[cdr108]

http://www.theglobeandmail.com/glob...be-good-news-for-real-estate/article12171482/

Home construction slowdown may be good news for real estate

LARRY MACDONALD
Special to The Globe and Mail
Published Tuesday, May. 28 2013, 4:00 AM EDT
Last updated Tuesday, May. 28 2013, 6:45 AM EDT


The housing bears ask: what’s to keep the soft landing in housing from morphing into a hard landing? Won’t a slowdown in sales and prices, they ask, curb housing-related industries and homeowners’ consumption, producing a retrenchment in the economy that leads to greater selling pressures in the housing sector? Let me try to answer the housing bears’ questions, although it may not be quite the response they would like to see.

First, a drop in home construction is actually a positive development for the housing market. It supports prices by curtailing supply. Layoffs in housing-related industries could possibly dampen the economy and cut into housing demand, but there will be an offset on the supply side.

In fact, the home building industry is now cutting back. But this is good news. As Gluskin Sheff economist David Rosenberg notes in his May 9 research report: “Housing starts for the past four months have come in below underlying demographic needs of around 185,000 units per year, and that is a critical part of the process in terms of prices finding a bottom.”

Second, I believe Roberto Cardarelli, the International Monetary Fund’s chief economist for Canada, has it right when he says the hit to construction-related sectors and homeowners’ consumption will be offset by an expansion in other industries. “We expect the pace of expansion [in Canada] to accelerate over the course of 2013,” declares Mr. Cardarelli in the IMF Survey Magazine. “The main reason for our optimism is that we expect export growth to strengthen, as the recovery in the U.S. economy gradually steps up the pace.”

Many people are worried about recent softening in the housing market, Chinese economy and commodity markets, but the U.S. accounts for about 75 per cent of Canadian merchandise exports. As it engages in unprecedented monetary stimulation and ramps up its economy, there should be a substantial and positive spill-over effect for Canada.

Furthermore, “as the U.S. economy strengthens and commodity prices moderate, we would expect some natural depreciation of the Canadian dollar, which will help boost exports and economic growth,” adds Mr. Cardarelli.

“These positive developments should more than offset the unfavourable conditions from weaker construction activity and more moderate consumption,” he concludes.

In short, the current housing slowdown likely isn’t headed toward a hard landing.

 

[azureray]

http://blogs.wsj.com/economics/2013/05/28/dont-believe-new-housing-bubble-hype/

Don’t Believe New Housing Bubble Hype

Recent increases in home prices have already ignited new talk of a housing bubble. Don’t believe it.

Some regions are seeing a surge of housing demand amid extremely low interest rates and investors searching for opportunities. And it is true that some regions are up more than 25% from their bottom. But as Dan Greenhaus of BTIG LLC points out, none of the 20 cities tracked by the Standard & Poor’s Case-Shiller home-price indexes is back to its peak level.

“Those previous peaks may not have been justified but they were and are largely seen as ‘bubble levels,’” said Mr. Greenhaus. “Can home prices again be in a bubble and yet be 27% below their previous peak? Perhaps, but we don’t yet think so.”

 

[azureray]

http://www.movesmartly.com/2013/05/a-closer-look-at-torontos-condo-market-.html

 

[daveto]

This fellow is a Burlington Realtor, and he claims his proprietary index predicts massive decreases in sales volumes starting in July.
http://www.rosskay.com

 

[azureray]

As realtors will always say 'Sell and sell now!' or 'Buy and buy now!', depending on the realtor's focus on listing agent or buyer agent.

Realtors are now struggling with one thing: Low inventory. Which means low sales, which means low commission which means no business for realtors.

There's only one way to change that, trigger a panic and have everyone sell to increase inventory.

As long as people are selling, the market is moving...and they have commission to make.

What do you think who will be buying when he says: 'As we have been advising our own clients since April of 2012, Sell and Sell Now.'

Funny.

This fellow is a Burlington Realtor, and he claims his proprietary index predicts massive decreases in sales volumes starting in July.
http://www.rosskay.com

 

[interested]

^^^
Anecdotally I can say that a couple of realtors I know have told me that the past 2 weeks there is a lot of activity. I personally just believe this is due to the lousy weather we had delaying the Spring market which others have said and I agree will run into June as it was delayed by about a month. I expect May/June will be comparable or up compared to last year but then I think it will remain subdued thereafter for the rest of the year.

 

[daveto]

As realtors will always say 'Sell and sell now!' or 'Buy and buy now!', depending on the realtor's focus on listing agent or buyer agent.

Realtors are now struggling with one thing: Low inventory. Which means low sales, which means low commission which means no business for realtors.

There's only one way to change that, trigger a panic and have everyone sell to increase inventory.

As long as people are selling, the market is moving...and they have commission to make.

What do you think who will be buying when he says: 'As we have been advising our own clients since April of 2012, Sell and Sell Now.'

Funny.

TREB data shows inventory 17% higher than 2011/12.

What is your source that inventory is low?

 

[interested]

without reviewing the data, I think he may be referring to SFH's in desirable areas.
Could this maybe be what he is referring to or have SFH inventories also risen?
I believe there is an increase in number of condos.

The other question as well I think daveto is how much of the market is "stale listings" where people don't really
want to sell but put it on and figure if I get a "ridiculous price" I will. In the overheated markets, poor quality
stuff was selling at premiums. Now, if one has a rather poorer quality product unless a tear down in a highly desirable area, I think it won't sell.

I am reminded a bit of Florida where we have a condo. There are 18 for sale but at least 12 are priced assuming a 10-15% increase in price over the last sale because prices are rising there. They are not selling and the few that are selling are going for realistic prices. I think in this market both in Toronto and Florida, there is no urgency to buy an overpriced property so inventories are rising as people hold out for unrealistic prices. That said, these same vendors are likely not challenged and so the real inventory (realistically priced to sell) may in fact be smaller than showing.