James
Senior Member
I can't argue with any of their observations. In essence, they're anticipating a 3-4% decline in condo prices over the next 2 years while single family home prices will continue to increase at a moderate rate.
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Baby, we got a bubble!?
- Thread starter simuls
- Start date
I can't argue with any of their observations. In essence, they're anticipating a 3-4% decline in condo prices over the next 2 years while single family home prices will continue to increase at a moderate rate.
TheKingEast
Senior Member
The only condo units I see dropping in price are the smaller 1 beds and 1+1 shoeboxes. Bigger 2 beds IMo will still be hot as 1) there aren't many of them and 2)those priced out of smaller houses will look to larger condos. Just my opinion.
Condo George
Active Member
TORONTO, April 16, 2015 – Toronto Real Estate Board President Paul Etherington announced that Greater Toronto Area REALTORS® reported 4,635 home sales during the first 14 days of April 2015. This result represented a 3.4 per cent increase compared to April 2014. New listings over the same period were down by 4.6 per cent year over year. “Home sales in the GTA continued to increase in comparison to 2014 as a diversity of buyers took advantage of affordable home ownership options. However, in many neighbourhoods, listings remain scarce, particularly for ground-oriented home types like singles, semis and towns. Given the amount of pent-up demand in the market today, sales growth would accelerate further if more homes were listed for sale,†said Mr. Etherington. The average selling price for April mid-month home sales was $625,121 – up seven per cent in comparison to the same time frame in 2014. Average prices were up for all major home types, both in the City of Toronto and the surrounding regions. “We are experiencing balanced to seller’s market conditions in most areas and market segments in the GTA. This suggests that home ownership demand is being driven by a wide swath of the population. On one hand, strong growth in condo listings has been met with strong growth in condo sales. On the other hand, we have also experienced growth in higher-end home sales,†said Jason Mercer, TREB’s Director of Market Analysis.
beemicha
New Member
It looks worrying for condo's doesn't it!? I wonder if the larger condo's will hold their price a bit better?
I'm looking to get out of my condo sooner rather than later and wondering has anyone seen any shipping container homes that have been built around Toronto? I've seen some incredible homes like this one from Tree Hugger or here.
I've search both sites and neither mention anything about one being built in Toronto- does anyone know what the building regs would have to say or whether it's even feasible?
Migos
Active Member
TREB Q1 Rental Report: http://www.torontorealestateboard.com/market_news/rental_reports/pdf/rental_report_Q1-2015.pdf
TREB Q1 Condo Report: http://www.torontorealestateboard.com/market_news/condo_report/2015/condo_report_Q1-2015.pdf
Going to be very interesting to see if this coming wave of condo completions will be absorbed or if investors are going to be bagholders for developers and agents that made a killing off them.
TREB Q1 Condo Report: http://www.torontorealestateboard.com/market_news/condo_report/2015/condo_report_Q1-2015.pdf
Going to be very interesting to see if this coming wave of condo completions will be absorbed or if investors are going to be bagholders for developers and agents that made a killing off them.
interested
Senior Member
At some point that will eventually happen. Just a question of when.
Eventually one would assume prices will stop escalating, investors will stop buying, or something will change.
It is a bit like musical chairs. You don't want to be the last one standing when the music stops.
ponyboy
Active Member
i thought this video of buying vs. renting scenario was well done --
http://www.theglobeandmail.com/repo...te-of-money/article22832602/#video0id22832602
http://www.theglobeandmail.com/repo...te-of-money/article22832602/#video0id22832602
wang888
Active Member
EU interest rates are going up. US plans to increase later this year. Maybe Canada will follow. Will this affect your mortgage payments.
James
Senior Member
I saw this article in the Toronto Star yesterday and it made me wonder why these stories are making headline news. As first-time home buyers, shouldn't these stories be the norm and not the exception? It never made sense to me why first-time buyers in Toronto were disappointed they couldn't buy a house down in the Beach, over in Leaside or near High Park.
http://www.thestar.com/business/201...s-found-a-toronto-house-for-under-500000.html
How four buyers found a Toronto house for under $500,000
City’s real estate market has become brutal for first-timers, but here are some victors who got in for less than half a million.
By: Susan Pigg Business Reporter, Published on Wed Apr 22 2015
Realtors call them “condo alternatives†— houses that may not offer the space and prime locations that a whole generation of baby boomers came to take for granted. But they do offer a backyard and one or two bedrooms at well below the average sale price in the GTA, which hit a record $613,933 in March.
Even the average GTA condo sale price hit $372,827 last month and is poised to surpass $400,000 in the city of Toronto for the first time.
These often tiny, imperfect houses — especially if they are within reasonable distance of major transit lines and shopping — are quickly disappearing and in high demand from first-time buyers, flippers and investors looking for a cheap rental property.
Surprisingly, about 90 houses sold for under $500,000 in the sought-after 416 region in the first two weeks of April’s peak spring buying market.
Admittedly, most were in areas once considered a tough sell.
Meet four happy — if nervous — couples who defied the odds and found a decent house to call home with a reasonable commute to the core.
SOLD: $430,000
LIST PRICE: $449,000
WHERE: Keele St. halfway between St. Clair and Eglinton Aves.
WHAT THEY GOT: Detached with no parking, 3 bedrooms, 1 bathroom in “as is†condition, a 20-by-100-foot lot
HOW: Savings and proceeds from sale of condo at Don Mills and Sheppard.
Justin Lau, 29, and his girlfriend Inge Boerma, 25, lost seven bidding wars in the east end before looking west. This house is on a busy street and needs work. But it’s halfway between the St. Clair streetcar line and new Eglinton LRT, a 45-minute drive to Lau’s Richmond Hill project management job and a 10-kilometre bike ride from Boerma’s fitness-related work downtown.
“I can’t believe a house that size is half a million dollars, but that’s what people are paying. I’m not too concerned that Toronto’s housing market is going to crash, but there may be a pull back.†— Justin Lau
SOLD: $435,000
LIST PRICE: $399,900
WHERE: Balfour Ave. in Danforth and Main St. area
WHAT THEY GOT: Rowhouse, no parking, 2+ bedrooms, 1 bathroom, a 12.5-by-100-foot lot
HOW: Savings, down payment help from dad, needed CMHC insurance
Web developer Simon Grossman, 35, and his fiancée Alison Britt, 34, a U of T arts major, lost out on five properties before beating out six bidders in March for this row house close to the subway and the Main GO Station. The couple saw “lots of really scary houses†under half a million. They won despite making their offer conditional on replacement of an outdated electrical box.
“The trick for us was finding a place where we would be comfortable if the market crashed and we were stuck there for 30 years. This is a tiny place — it looked much bigger in the pictures — but it’s cozy.†— Simon Grossman
SOLD: $458,000
LIST PRICE: $469,900
WHERE: Corbett Ave. in St. Clair and Runnymede area
WHAT THEY GOT: detached, lane parking with garage, 3 bedrooms, 2 bathrooms, 16-by-112-foot lot
HOW: RRSPs, investments, savings and needed CMHC insurance
Comptroller Zahra Hirji, 29, and her animator partner Jodi Sandler, 31, knew they’d found a rare gem right away: a detached house in the city of Toronto for less than half the average price, even if the area is in transition. Both their mothers were quite vocal that the place was too tiny, too expensive and in need of too much work. But Sandler delights in having a home office.
“It’s a decent-sized house. I think it paid to jump in just a little bit early in the year (January), so we didn’t have a lot of competition and a bidding war. We were prepared to do a bit of work.†— Jodi Sandler
SOLD: $495,000
LIST PRICE: $499,000
WHERE: Rockwell Ave. in St. Clair and Caledonia area
WHAT THEY GOT: semi-detached, mutual drive, 3+ bedrooms, 3 bathrooms on 17.5-by-100-foot lot
HOW: RRSPs, TSFAs, money from their September wedding
This semi showed poorly when newlyweds Shae Greenfield, 32, who works for the province, and his wife Sara, 29, who works for a non-profit, went to see it April 2 after 40+ days on market. They considered it a plus that the house needs work and the area is in transition. They made an offer that night, good for just two hours, after the price dropped from $509,000.
“We talked about holding off and saving up more money to be able to buy more house, but at the rate house prices are climbing, we felt we’d probably end up moving backwards.†— Sara Greenfield.
The spring market in the Toronto area has been especially frantic the past two or three years as first-time buyers grow more concerned that a housing correction isn’t coming anytime soon and they’ll have to jump in before prices climb even further out of reach.
At the same time, listings have seriously lagged behind demand.
That supply-demand imbalance helped push home prices up 10 per cent year over year in March.
Breaking into Toronto’s housing market has become far tougher than ever, according to research compiled for the Star by TD Economics economist Diana Petramala. She was co-author of a recent TD report that warned the GTA is fast becoming the Big Apple of the north, thanks to a decade-long housing boom that has eroded affordability.
Back in March of 1996, the average GTA home price was just $196,476 — about $280,394 in today’s dollars.
The average GTA income back then was $49,374 — just over $70,000 when inflation is factored in. While annual incomes were much lower among young buyers aged 25 to 34 and 35 to 44, at an average of $27,879 and $35,367 respectively (that equates to annual salaries today of $39,789 and $50,473), they were still enough to make home ownership a real possibility.
As of this March, however, the average GTA home price hit $613,933.
But that includes resale condos, which now account for a considerable portion of overall GTA home sales and distract from the fact that the average price of a fully detached house in the 416 and 905 regions combined was $787,388 last month — and over $1 million in the sought-after city of Toronto.
GTA incomes this year, as forecast by TD Economics, are expected to average $91,005, effectively the same as 1996 salaries for those in prime house-buying years of age 25 to 34 and 35 to 44 at just $38,591 and $59,393 respectively.
Interest rates have provided some buffer for today’s buyers, given that mortgages came with rates averaging 7.9 per cent in 1996, compared to just 3.99 per cent now. Rates are much lower, about 2.7 percentage points, for those locking in to a five-year mortgage today.
http://www.thestar.com/business/201...s-found-a-toronto-house-for-under-500000.html
How four buyers found a Toronto house for under $500,000
City’s real estate market has become brutal for first-timers, but here are some victors who got in for less than half a million.
By: Susan Pigg Business Reporter, Published on Wed Apr 22 2015
Realtors call them “condo alternatives†— houses that may not offer the space and prime locations that a whole generation of baby boomers came to take for granted. But they do offer a backyard and one or two bedrooms at well below the average sale price in the GTA, which hit a record $613,933 in March.
Even the average GTA condo sale price hit $372,827 last month and is poised to surpass $400,000 in the city of Toronto for the first time.
These often tiny, imperfect houses — especially if they are within reasonable distance of major transit lines and shopping — are quickly disappearing and in high demand from first-time buyers, flippers and investors looking for a cheap rental property.
Surprisingly, about 90 houses sold for under $500,000 in the sought-after 416 region in the first two weeks of April’s peak spring buying market.
Admittedly, most were in areas once considered a tough sell.
Meet four happy — if nervous — couples who defied the odds and found a decent house to call home with a reasonable commute to the core.
SOLD: $430,000
LIST PRICE: $449,000
WHERE: Keele St. halfway between St. Clair and Eglinton Aves.
WHAT THEY GOT: Detached with no parking, 3 bedrooms, 1 bathroom in “as is†condition, a 20-by-100-foot lot
HOW: Savings and proceeds from sale of condo at Don Mills and Sheppard.
Justin Lau, 29, and his girlfriend Inge Boerma, 25, lost seven bidding wars in the east end before looking west. This house is on a busy street and needs work. But it’s halfway between the St. Clair streetcar line and new Eglinton LRT, a 45-minute drive to Lau’s Richmond Hill project management job and a 10-kilometre bike ride from Boerma’s fitness-related work downtown.
“I can’t believe a house that size is half a million dollars, but that’s what people are paying. I’m not too concerned that Toronto’s housing market is going to crash, but there may be a pull back.†— Justin Lau
SOLD: $435,000
LIST PRICE: $399,900
WHERE: Balfour Ave. in Danforth and Main St. area
WHAT THEY GOT: Rowhouse, no parking, 2+ bedrooms, 1 bathroom, a 12.5-by-100-foot lot
HOW: Savings, down payment help from dad, needed CMHC insurance
Web developer Simon Grossman, 35, and his fiancée Alison Britt, 34, a U of T arts major, lost out on five properties before beating out six bidders in March for this row house close to the subway and the Main GO Station. The couple saw “lots of really scary houses†under half a million. They won despite making their offer conditional on replacement of an outdated electrical box.
“The trick for us was finding a place where we would be comfortable if the market crashed and we were stuck there for 30 years. This is a tiny place — it looked much bigger in the pictures — but it’s cozy.†— Simon Grossman
SOLD: $458,000
LIST PRICE: $469,900
WHERE: Corbett Ave. in St. Clair and Runnymede area
WHAT THEY GOT: detached, lane parking with garage, 3 bedrooms, 2 bathrooms, 16-by-112-foot lot
HOW: RRSPs, investments, savings and needed CMHC insurance
Comptroller Zahra Hirji, 29, and her animator partner Jodi Sandler, 31, knew they’d found a rare gem right away: a detached house in the city of Toronto for less than half the average price, even if the area is in transition. Both their mothers were quite vocal that the place was too tiny, too expensive and in need of too much work. But Sandler delights in having a home office.
“It’s a decent-sized house. I think it paid to jump in just a little bit early in the year (January), so we didn’t have a lot of competition and a bidding war. We were prepared to do a bit of work.†— Jodi Sandler
SOLD: $495,000
LIST PRICE: $499,000
WHERE: Rockwell Ave. in St. Clair and Caledonia area
WHAT THEY GOT: semi-detached, mutual drive, 3+ bedrooms, 3 bathrooms on 17.5-by-100-foot lot
HOW: RRSPs, TSFAs, money from their September wedding
This semi showed poorly when newlyweds Shae Greenfield, 32, who works for the province, and his wife Sara, 29, who works for a non-profit, went to see it April 2 after 40+ days on market. They considered it a plus that the house needs work and the area is in transition. They made an offer that night, good for just two hours, after the price dropped from $509,000.
“We talked about holding off and saving up more money to be able to buy more house, but at the rate house prices are climbing, we felt we’d probably end up moving backwards.†— Sara Greenfield.
The spring market in the Toronto area has been especially frantic the past two or three years as first-time buyers grow more concerned that a housing correction isn’t coming anytime soon and they’ll have to jump in before prices climb even further out of reach.
At the same time, listings have seriously lagged behind demand.
That supply-demand imbalance helped push home prices up 10 per cent year over year in March.
Breaking into Toronto’s housing market has become far tougher than ever, according to research compiled for the Star by TD Economics economist Diana Petramala. She was co-author of a recent TD report that warned the GTA is fast becoming the Big Apple of the north, thanks to a decade-long housing boom that has eroded affordability.
Back in March of 1996, the average GTA home price was just $196,476 — about $280,394 in today’s dollars.
The average GTA income back then was $49,374 — just over $70,000 when inflation is factored in. While annual incomes were much lower among young buyers aged 25 to 34 and 35 to 44, at an average of $27,879 and $35,367 respectively (that equates to annual salaries today of $39,789 and $50,473), they were still enough to make home ownership a real possibility.
As of this March, however, the average GTA home price hit $613,933.
But that includes resale condos, which now account for a considerable portion of overall GTA home sales and distract from the fact that the average price of a fully detached house in the 416 and 905 regions combined was $787,388 last month — and over $1 million in the sought-after city of Toronto.
GTA incomes this year, as forecast by TD Economics, are expected to average $91,005, effectively the same as 1996 salaries for those in prime house-buying years of age 25 to 34 and 35 to 44 at just $38,591 and $59,393 respectively.
Interest rates have provided some buffer for today’s buyers, given that mortgages came with rates averaging 7.9 per cent in 1996, compared to just 3.99 per cent now. Rates are much lower, about 2.7 percentage points, for those locking in to a five-year mortgage today.
Migos
Active Member
http://business.financialpost.com/personal-finance/mortgages-real-estate/heres-whats-really-scary-about-high-ratio-mortgages-in-canada
NEGATIVE savings rate of 13%. These people can't afford those homes NOW, let alone when interest rates rise. 1.8 million households is a significant number.
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interested
Senior Member
I agree US may increase later this year...marginally.
EU interest rates are going up?
I was under the impression the opposite was happening in Europe with their QE
Am I mistaken?
NorthYorkEd
Active Member
To each his own, but I would be literally sick to my stomach if I had spent that much money on such undesirable properties in such undesirable neighbourhoods. These couples are likely in for some form of rude awakening, especially when it comes to repairing or maintaining homes that took every single cent they had just to get. Hope no one loses a job, gets sick, or that any major repairs are needed. (But of course, the house can always be sold at a moment's notice, for buckets more than was paid, even when factoring in commissions, land transfer double-dip, taxes, mortgage interest, CMHC gouge, and the costs of getting and keeping the home operational.
)Boomer parents grew up in a time of prosperity, when houses were seen as the Golden Goose. They are passing that mentality along to their kids, even if it means gutting their own retirements. All of these couples could have found better homes in better neighbourhoods, for more reasonable monthly costs. But they might have had to rent (oh no, the horror!)
We can all see the intrinsic value in fine things. An expensive wine, a finely crafted instrument, a rare and well-preserved antique. No one can argue that these things hold a value that can be perceived and recognized by rational people. But can anyone tell me how these mouldy, pest-infested, rundown, piles of crumbling bricks and rotten wood are worth so much money, outside of the twisted perspective of a market that is simply pulling these values out of its ass?
TheKingEast
Senior Member
To each his own, but I would be literally sick to my stomach if I had spent that much money on such undesirable properties in such undesirable neighbourhoods. These couples are likely in for some form of rude awakening, especially when it comes to repairing or maintaining homes that took every single cent they had just to get. Hope no one loses a job, gets sick, or that any major repairs are needed. (But of course, the house can always be sold at a moment's notice, for buckets more than was paid, even when factoring in commissions, land transfer double-dip, taxes, mortgage interest, CMHC gouge, and the costs of getting and keeping the home operational.
Boomer parents grew up in a time of prosperity, when houses were seen as the Golden Goose. They are passing that mentality along to their kids, even if it means gutting their own retirements. All of these couples could have found better homes in better neighbourhoods, for more reasonable monthly costs. But they might have had to rent (oh no, the horror!)
We can all see the intrinsic value in fine things. An expensive wine, a finely crafted instrument, a rare and well-preserved antique. No one can argue that these things hold a value that can be perceived and recognized by rational people. But can anyone tell me how these mouldy, pest-infested, rundown, piles of crumbling bricks and rotten wood are worth so much money, outside of the twisted perspective of a market that is simply pulling these values out of its ass?
That's your opinion, though. The locations may not be desirable to you. The houses may not be nice to you but obviously some people like them enough to buy. Some years ago, there were areas that I wouldn't even step foot in. Fast forward 10-15 years later. A complete overhaul. Some people are buying to live for 20+ years. The area may be crap now, but may be better in the future. The houses can be upgraded over the years. Some don't mind that.
NorthYorkEd
Active Member
I agree, but I'm thinking many did not buy these houses because they liked them or thought they held potential future value. They bought because they HAD to buy something, even if it was a pile of crap in an area they would otherwise prefer not to live in. No other asset sees the amount of "settling for less" that housing does.
This market reeks of manipulation and artificial inflation. People are not getting richer, except realtors and others who benefit from prolonging the illusion that this city (and Vancouver) are wondrous paradises deserving of these stupid high prices. They are not. It's a wealth transfer of unprecedented proportions, as we'll see when the rug is finally pulled out and an entire generation finds itself reduced to impoverished debt slaves.
James
Senior Member
^ Case in point: I remember 20 years ago when King West was non-existent and going east towards Leslieville was still an after thought.