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Baby, we got a bubble!?

daveto said:
Above in bold you reference 1,518 sales (and avg condo prices of $341), but you didn't say what those sales refer to. I presume they are condos+townhouses?

TREB's 2012 july mid-month data references 1481 sales, and average condo prices of $329k.
http://www.torontorealestateboard.c...market_updates/news2012/nr_mid_month_0712.htm

So that would be a 2% increase in sales volumes, and a 4% avg price increase.

I'm a RE bear, but those figures demonstrate ongoing strength in the market (although I wonder if rising rates might have brought demand forward)
Click to expand...

Yes, that was for Condos and Condo Townhouses and I stopped with looking at the # of sales right there since I noticed that the average price was down.
Bmy opinion the numbers of sales decreasing and steady prices prove that the market is worsening but resisting. When the number of sales increases and the prices decrease that is sign of panic and that tells you that the market (the sellers) gave up on resisting
This is what I am reading in my values for condos quoted above.

Note that these are stats compiled on the fly not based on more elaborated Excel based analysis and for that reason I could not change the format of the report
I basically used a script that I use for daily stats but I pointed the script to 15 days ago and this is why you see those values still there. Practically I realized that I could use my script to find out in an instant what was going on without connecting Excel to the database and playing with pivot tables. Hence the remains of the "daily view" numbers that you bolded

So if you allow me to keep the focus on condos (which I understand it is the main interest area around here) the mid month prices a year ago were:
416 Condos= 349730
905 Condos= 277441
The above are adjusted values as we all know by now.This year:
416 Condos:354031
905 Condos:288354

If you take away 3% of the transactions you might break even at best.
For Toronto we have 840 condos sold so far (again unadjusted value)

I am not sure how you calculated the 2% increase in sales
If you remove the 11 properties above 1 mil you have a 341K average for Toronto (that might compensate for the 3% of transactions which usually don't complete although thei are reported)
 
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Recharts: A few comments about your statements in post $7967.
I believe political properness has gone way too far as you do. I am all for saying what is unpopular. In fact, I applaud it.
I appreciate that you are fighting an uphill battle against a real estate industry, development industry, MSM and governments that collect taxes that all wish ever escalating prices.

However, that is not a reason to not be civil.
One can make a point without personally insulting the person with the opposite view. In fact, I would suggest that by insulting the other point of view, your well argued points risk being lost or at least clouded and have less impact that it might otherwise have had.

Again, just my opinion.

Real estate in Germany if I am correct has hardly budged in the past 10 years in value. In fact, I found data suggesting it has risen 7% nominally since 2006 and had been essentially stagnant from 2000- 2010. I don't think this is necessarily a good or a bad thing. Probably a good thing that it is not rising and therefore less unaffordable. However, I have not looked into it but I am quite sure home ownership in Germany is lower than in Canada.

I agree with the idea of taxing "investors". I agree with charging it as a business as in Germany.
Just to clarify for you....as a small landlord I have sold 2 investment properties in the past 10 years and purchased others. These were business decisions....not speculative ones. I do not buy property to "flip". I buy property as part of a diversified portfolio of assets. I buy it for cash flow and view it as a bond or a GIC....as a fixed income investment. Personally, I couldn't care less if property goes up or down 20%. I would not like to see it drop much more than 20% because of the far reaching effects that would have on jobs and the problems it would create for others much less fortunate than me.

I also agree that "getting rich quick" for not working is not a healthy basis on which to form an economy.

I will allow you one more rebuttal if you feel it necessary recharts and then will stop as I believe both of us have expressed our views to each other and can agree to agree on some issues and disagree on others.

Please keep posting your data and your interpretations as I find it informative.
 
The german politicians and lawmakers and the germans in general understand that moving money from one pocket to the other does not create progress. That is why we buy german products and we send them back maple syrup, oil and seal skins. We sit under the trees and wait for bananas to ripe and then we sell them. Or condos, just to stay on topic.
In Germany and in Europe in general the focus is on "to be" not on "to have". The health care is not as expensive as here and they are not treating foreign doctors llike monkeys asking them to redo their studies when the country has not enough doctors and people line up in emergency rooms. In Germany does not take you ages to get to see a specialist or to benefit from your heath insurance if you need to
Renting is not a social stigma and companies like Nortel and RIM do not go belly up pestered and sucked to death by their own employee
And their CHMC (if they have one) does not help people to buy houses over 500K or 1M for decades. I would stop here because of lack of time...there is huge differences between the two countries, don't even try to compare them

Uphill battle with the dark side ? No way. Just sharing the data. It would be naive to believe that I can change anything this way.


interested said:
Recharts: A few comments about your statements in post $7967.
I believe political properness has gone way too far as you do. I am all for saying what is unpopular. In fact, I applaud it.
I appreciate that you are fighting an uphill battle against a real estate industry, development industry, MSM and governments that collect taxes that all wish ever escalating prices.

However, that is not a reason to not be civil.
One can make a point without personally insulting the person with the opposite view. In fact, I would suggest that by insulting the other point of view, your well argued points risk being lost or at least clouded and have less impact that it might otherwise have had.

Again, just my opinion.

Real estate in Germany if I am correct has hardly budged in the past 10 years in value. In fact, I found data suggesting it has risen 7% nominally since 2006 and had been essentially stagnant from 2000- 2010. I don't think this is necessarily a good or a bad thing. Probably a good thing that it is not rising and therefore less unaffordable. However, I have not looked into it but I am quite sure home ownership in Germany is lower than in Canada.

I agree with the idea of taxing "investors". I agree with charging it as a business as in Germany.
Just to clarify for you....as a small landlord I have sold 2 investment properties in the past 10 years and purchased others. These were business decisions....not speculative ones. I do not buy property to "flip". I buy property as part of a diversified portfolio of assets. I buy it for cash flow and view it as a bond or a GIC....as a fixed income investment. Personally, I couldn't care less if property goes up or down 20%. I would not like to see it drop much more than 20% because of the far reaching effects that would have on jobs and the problems it would create for others much less fortunate than me.

I also agree that "getting rich quick" for not working is not a healthy basis on which to form an economy.

I will allow you one more rebuttal if you feel it necessary recharts and then will stop as I believe both of us have expressed our views to each other and can agree to agree on some issues and disagree on others.

Please keep posting your data and your interpretations as I find it informative.
Click to expand...
 
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recharts said:
So if you allow me to keep the focus on condos (which I understand it is the main interest area around here) the mid month prices a year ago were:
416 Condos= 349730
905 Condos= 277441
The above are adjusted values as we all know by now.This year:
416 Condos:354031
905 Condos:288354

If you take away 3% of the transactions you might break even at best.
For Toronto we have 840 condos sold so far (again unadjusted value)

I am not sure how you calculated the 2% increase in sales
If you remove the 11 properties above 1 mil you have a 341K average for Toronto (that might compensate for the 3% of transactions which usually don't complete although thei are reported)
Click to expand...

1. 1519/1483 = 102%. ie a 2% increase in sales July Mid-month Condo + Townhouse, YoY (note 1519 your figure 2013, 1483 TREB figure 2012)
2. There is no logical reason to remove the 11 sales at $1m. While the $ amount might be equal to the 3% of transactions that don't complete, that is a non-sequitor. The data in both cases (2012 & 2013) is prior to the 3% which don't complete. Even if it wasn't, the choice to remove the 11 $1m properties would skew the avg price lower, versus removing 3% of 840 properties at the avg price.
 
daveto said:
1. 1519/1483 = 102%. ie a 2% increase in sales July Mid-month Condo + Townhouse, YoY (note 1519 your figure 2013, 1483 TREB figure 2012)
2. There is no logical reason to remove the 11 sales at $1m. While the $ amount might be equal to the 3% of transactions that don't complete, that is a non-sequitor. The data in both cases (2012 & 2013) is prior to the 3% which don't complete. Even if it wasn't, the choice to remove the 11 $1m properties would skew the avg price lower, versus removing 3% of 840 properties at the avg price.
Click to expand...
agree on the 1M condos
I do not understand their logic when they count the condo town houses as townhosues or SFH and for that reason I do not look at their stats
They were included in the big daily number but that is as far as I went with including them in my stats
We do not have an oversupply of townhouses (and condo townhouses) and they are a marginal category and for that reason I am not including them. If you ant to calculate it that way it is your choice but as far as I am concerned the condo market is stagnant at most, YoY.

Trying to stay objective I went and looked at the last year and indeed there was a big gap as well between June and July values
On the other side last year the new rules were put in place and that might explain it. Not sure what it can explain it for this year

I did not have the time to go back to two years ago though ...feel free to add your efforts to mine to put some light on this, go back and see if Jule to July was such a big difference two years ago.
 
recharts said:
I am kind of sick of this
Click to expand...

I understand how you feel, since you have been repeating this forever and no one agrees with you. And you still dont get why you keep getting banned from redflagdeals almost monthly.
Very frustrating for sure.
 
Just picked up the latest condo magazine and flipping through and practically every condo development advertised was promoting incentives of some kind. I know that's anedotal but it must indicidative of a softening market.
 
This is what I find scary about the reliance on real estate to produce wealth in this province, especially with YTD YoY $ sales (up to end of June) for TREB being down 5%:

Structure of the Ontario Economy, 2012
Per Cent share of Nominal GDP

Health & Education 13.2%
Real Estate Renting & Leasing 13.2%
Manufacturing 12.9%
Finance & Insurance 8.2%
Wholesale & Retail Trade 11.3%
Construction 6.2%
Transportation & Warehousing 4%
Information & Cultural 3.8%
Utilities 2.1%
Primary 1.3%
Other 23.3%

Finance and Insurance will go hand and hand with Real Estate industry's performance, downstream will affect construction & wholesale/retail trade.
 
So much money in real estate and the industries that support it is a misallocation of resources IMO. What emerging businesses, productivity growth, innovation, flexibility, and mobility are promoted by supporting real estate ownership as a treasured social good? I feel that if we start to see the standard of living slide in years ahead, it may be traced to our current choice of debt for real estate over debt (investment) for new businesses and productivity. Robert Schiller has a thoughtful piece in the NYTimes yesterday questioning the value of government promoting homeownership.
 
no - i had the hardcopy off the streets - just seemed like there were an awful lot of promotions being advertised.
 
ponyboy said:
So much money in real estate and the industries that support it is a misallocation of resources IMO. What emerging businesses, productivity growth, innovation, flexibility, and mobility are promoted by supporting real estate ownership as a treasured social good? I feel that if we start to see the standard of living slide in years ahead, it may be traced to our current choice of debt for real estate over debt (investment) for new businesses and productivity. Robert Schiller has a thoughtful piece in the NYTimes yesterday questioning the value of government promoting homeownership.
Click to expand...

I think that's a really good point -we've used real estate and all of the spin off industries to make up for the loss of other businesses - particularly manufacturing... and that is why a crash in the real estate market could be really devestating. I don't know if market will crash and I hope it won't - I hope we are in for a soft landing.
 
marsh said:
I think that's a really good point -we've used real estate and all of the spin off industries to make up for the loss of other businesses - particularly manufacturing... and that is why a crash in the real estate market could be really devestating. I don't know if market will crash and I hope it won't - I hope we are in for a soft landing.
Click to expand...
You are not being realistic
Our economy has fed on RE and is addicted to that.
How do you expect the debt to stop increasing, the GDP to stay at the same level and cut the addiction?

Stopping RE at this point has become impossible since there is lots of jobs in that
Continue to run the country this way will get us in debt totally.
How do you propose we reconcile these two tendencies ?
Our other industries are mostly dead, we sell resources but the demand is not stellar in that sector.
What else is left ???
 
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