Baby, we got a bubble!?

[Eug]

North of Dundas on Yonge Street are a ton of restaurants. However, I would not want to live on Yonge Street. Living on Bay Street is nice, because it's close by but is comparatively very quiet.

I lived just south of Bloor for a while, between Bay and Yonge. It was a great place to be. And yeah, I shopped at the Manulife Centre and the nearby Rabba all the time, and I would go to Cumberland Theatre in Yorkville from time to time.

The other thing is that it's close to Mount Pleasant and Bloor/Danforth. Easy access to go north, or to Greektown. (I work near mid-town, so going north from there makes sense for me.) You can either drive, or you can take the subway.

Transit-wise, it's a heluvalot more convenient than Liberty Village for example. Even where I used to live at Bathurst and Front, it was annoying in terms of transit. And these days it's really annoying for driving too. Traffic down there is horrible these days, I guess because of the bazillion condos everywhere.

 

[Eug]

Interesting. I hadn't explored MLS's historical pricing index much until today.

Teranet's housing price index is at www.housepriceindex.ca
MLS's housing price index is at www.homepriceindex.ca

The latter is actually more fine grained, which is helpful for judging single family home vs. condo pricing.

MLS's index starts with Jan. 2005 set at an index of 100.
The composite rise until March 2014 is up to 166.1, but SFH are 170.5 (with 1-storey 173.5 and 2-story 168.7).
This means the rise is 66.1% overall and 70.5% for SFH (1-storey 73.5% and 2-storey 68.7%).
In contrast, condos as expected have risen the least, at 156.9 (which is +56.9%).

When I bought my single family home, the index was 135.7 overall, or 134.6 for a SFH, or 129.1 for a 2-storey SFH.
That suggests a rise of 22.4% (overall), 26.7% (SFH), or 30.1% (2-storey SFH).

In contrast, Teranet has the composite rise only.
Their January 2005 number is 96.27 (since their 100 is set to June 2005).
In March 2014 it's 154.63, or a rise of 60.6%, which is within 10% of the MLS number.

For my own house, it was 111.61, so the current 154.63 is a rise for the composite index of 38.5%.

---

I was looking at some recent home sales in my neighbourhood, and that Teranet rise didn't seem to make sense. It was hard to gauge because most of the home sales I was looking at were teardown/rebuilds, but nonetheless, nothing seemed to justify a 38%+ rise in prices in the neighbourhood for those types of homes. So, although Teranet does paired comparisons, I had a hard time believing it really was accurate, at least for my neighbourhood.

The MLS numbers do make more sense, with a composite rise of 22.4%, and a 2-storey SFH rise of 30.1%. I'm not interested in selling at this point, but if I were to sell my house today, I'd probably list it at somewhere between 130%-135% of my purchase price (noting that I did do some renos in the interim). I'd hope to get at least 130%, but I wouldn't completely rule out say 125%+ depending on how desperate I was to move.

EDIT:

P.S. Compounded over 6.75 years, 30% works out to exactly 4% per year.

 

[cdr108]

from my discussions with realtors in the field, sales are low.
with 40,000 agents in the GTA, many aren't making deals, so no $$$

it doesn't take a rocket scientist to understand why CG is here after almost a year's absence.
he has free time and needs to generate commissions somewhere so he's mining all options.

Condo George, when, in response to CN Tower posts, you vowed to never ever to make a post on this thread, both Interested and I implored you to not to desert us. But you did.

Go back and reads the posts about 2/3 years earlier.

If a cow puts dung in the milk, then, we have to do something to make sure that it does not happen again

 

[KA1]

KAI you disappointed me. Forget about it.

Condo George: an after thought for you.

When I was young, had no grey hair, no wrinkles and was being 'hounded' by young sweet things -- and that is quite a few decades ago -- I studied Marketing for 6 months in London, England. First chapter of the book stated that marketing is giving the right product to the right people at right place .....

By that criteria, you have been completely wrong in your nickel posts on this thread. Perhaps, you might wish to start your own channel on Youtube and post there anything and every thing that you wish to, including posing in the 'buff'. We will know by the number of hits as to how many individuals are interested in you beyond the real estate matters.

On another note, I will like to repeat what CN Tower has said in his latest post -- you are a good sales person.

In a few months, I will be getting possession of a unit on the 'Executive' floors of AURA. I am told that condo registration and title change will be in the Spring of 2015. At present, similar size of units are being offered on 'assignment' on Kijiji for Mill plus sixty.

After the title change,I will hold on to the unit for a while so as to not to give CRA grounds to treat gain on the sale as 'income' rather than capital gains.

Sometime in 2016, I might be interested in selling this 'upscale' unit. I will be quite willing to talk to you about this transaction at that time. I have that much regard and respect for your sales abilities.

Nothing personal, George.

Rest of the stuff is ...

 

[sentiant]

Little people criticize the doers.
condo George im sure you dont need me to boost your ego, but looks like the haters are on the attack. I have been following this is thread for a while now. Its so good I went back a couple years to see where the conversation was going back then. Condo George, cntower and a few others have excellent made excellent contributions, but when it comes down to it condo George puts his chips on the table and calls it as he sees it. The others mostly come from a fear based point of view.
hopefully condo George will keep contributing so as to keep this thread from disintegrating into a negative sess pool of wannabes and coulda, shoulda, if, but only, stories filled with regret, frustration, and fear.
condo George becon of light!?
In this thread, YES

 

[kalvinone]

@sentiant - agreed.
We all have our opinions/fear/hope what ever you call it.... and certainly, CG has some good opinions (which btw, somewhere down the road, I may just hire you) but certainly, as with everyone's opinion, keep it uncensored but clean... it is the internet after all.

 

[greenleaf]

A look at what is happening in China. It's interesting to see their policy changes compared to ours.

From NY Times, China Real Estate Falls Back to Earth:

"Housing starts plummeted 25 percent last month from a year ago, the Chinese government announced on Tuesday — a severe blow for a country in which residential real estate construction has come to account for one-ninth of all economic output.

China’s real estate market correction — some economists are even calling it the popping of a bubble — is partly the result of a deliberate decision by the country’s leaders in Beijing.

The Federal Reserve and other regulators in the United States did not try to pop the American housing bubble in the decade leading up to the market’s slump in 2008.

But the Chinese leadership has been increasingly concerned over the past several years that housing prices were rising to unaffordable levels and that the economy was becoming overly dependent on investment, and it has taken action.

The result has been a series of policies that includes punitive interest rates for mortgages on second homes, a ban on the purchase of third homes and, more recently, deliberate action by the central bank to keep short-term interest rates well above the rate of inflation. Zhou Xiaochuan, the governor of the central bank, the People’s Bank of China, reaffirmed tight credit policies on Saturday, saying that he did not think the economy was in sufficient trouble to justify monetary policy stimulus.

In a country where real estate sales offices have become ubiquitous and tower cranes are jokingly described as the national bird, the question is how much further the real estate market will slow, and whether its troubles will spill into other sectors of the economy, notably the banking system."

and

"The bulk of the homes in China were purchased more than five years ago, and real estate prices have about doubled in the past five years. Mortgage down payments range from 20 percent to 40 percent and are often higher, giving banks a larger cushion against losses.

Chinese families also have one of the world’s highest saving rates — nearly half of income for urban households, compared with almost zero for American households."

 

[Eug]

The Chinese market has even less in common with the Canadian market than the US market does.

Just one example: In China you have entire built-up neighbourhoods that are completely devoid of residents, partially because there an occupied condo is a "used" condo and will lose value.

 

[cdr108]

smarter move than what we did here I say.

I think the gov't should have implemented restrictions on foreign ownership.
if it's not a big part of the market, then there's no need for the real estate and developers to cry fowl; and if they are, at least it limits that aspect of driving prices higher than local market demands.

with escalating prices, people have become house poor where "disposable income" is being directed to mortgages, etc and not to discretionary spending, which drives the local economy.

A look at what is happening in China. It's interesting to see their policy changes compared to ours.

From NY Times, China Real Estate Falls Back to Earth:

 

[interested]

^^^
I just heard that Investor's Group (IG) is offering a 3 year variable of 1.99%.
Apparently one still has to qualify for 5 year rates and higher rates but still this is supposedly the lowest rates ever offered.

Will be around for about 30-90 days they say so maybe just to get "eyeballs" to the fact that IG offers mortgages.

 

[James]

Investor's Group's new promotional offer could spark a small rally but as anyone with investment experience knows, rallies can be short-lived if the fundamentals are not supporting it. I think a lot of people are in a hold position right now, just watching the market to see where it goes before making any decisions.

 

[Eug]

Investor's Group's new promotional offer could spark a small rally but as anyone with investment experience knows, rallies can be short-lived if the fundamentals are not supporting it. I think a lot of people are in a hold position right now, just watching the market to see where it goes before making any decisions.

IG's rate is unlikely to spark anything. They're too a small player, and will remain small in the near term.

If there is a rally, it won't be because of IG.

 

[DearSummer]

Question for industry experts:

Why is the new home market so opaque? When a new condo launches, all they provide is vague price ranges and marketing sheets. To get the real info (i.e. floorplans and exact prices), you need to register or call an agent. Why is this? Why don't these just release all of the information on the website?

 

[Condo George]

11 Wellesley day 1 sales event, over 500 units sold now in 10 day period. This is the 3rd successful pre construction event this year, the pre construction investor was somewhat absent from the market for about 1.5 yrs but here is further evidence that the market has shifted positive.

 

[cdr108]

^ ^ ^

mods, please delete the above post and pics.
it has been re-posted several times in various threads.