Canada's housing bubble?
- Thread starter stinkynuts
- Start date
According to most, it is going to burst ten years ago, nice years ago, eight years ago, yesterday, next week.
You can't look at real estate canada wide. There is no canada wide bubble.
Unless we get an interest rate shock or the economy collapses- there likely won't be a burst- more of a slow deflation
Burst?
The so called experts have been predicting that since the mid 2000's. The prices did take a 20% dive in 2008, but rebounded within months. That was probably your opportunity.
Real Estate in Toronto has never been cheap. Not ever. It fluctuates, by as much as 30 or 40 percent even. But it never bursts.
There are only 2 things that will cause the price of real estate in Toronto to drop by 40 percent. 1. An increase in interest rates in excess of 3 percent, or a major economic meltdown. Both of which are possible, but neither is desirable since you won't be able to afford the increased interest payments, or you won't have a job to pay the mortgage. Take your pick.
If you think that the market in Toronto will "burst" because it is over built, it will not. The only thing that may be over built in Toronto would be condos and all that happens then if the market slows down due to too much supply is that they stop building them. They aren't building any new subdivsions in Toronto as far as I'm aware (maybe the odd brown field development, but land for single family homes is very scarce.)
Not according to the Globe and Mail last week:
http://www.theglobeandmail.com/repo...-down-alberta-housing-market/article24703195/
Totally agree. Toronto, believe it or not is an international city...........people look at our market and compare to Tokyo, New York, Hong Kong, London etc. and think it is a bargain. Middle Eastern, Eastern European and Asian $$$$$$$$$$ still investing here. The "bubble" stories appear regularly, once or twice a month, editors seem to think bad news headlines sell newspapers, go figure! The Canadian Market as a homogeneous entity is a myth...........kinda like saying the average temperature in Canada is x and therefore all Canadians must be wearing the same type of clothing.
Down yes but not even close to the bubble bursting. From what I've read and been told while in Alberta prices are off 5% to 15%. Sales are very slow (down about 25%) as buyers seem to be waiting for bargains that have yet to appear but sellers are not giving anything away just yet.
It will burst when interest rates rise. Lets face it. We've had record low interest rates for over 6 years running. And TPTB are always telling us the economy is improving. Well if it's improving why don't you raise rates ? They can't raise rates because even if they raised them a measly 1% it would double Western Governments debt payments overnight and everybody would be proven to be completely insolvent. How much longer can they keep a lid on this ? I don't know. We don't have real accounting standards any longer. Not since the crash in 2008 where Banks are allowed to declare underwater assets as mark to model and not mark to market. So I don't know when it all comes down. But it's running on ether right now.
BS
BS
You can't predict future prices. Might as will ask when blackberry stock will implode.
The takeaway from guaranteed market corrections (and cdn housing prices will go through a collection eventually) is that you can still make a quick buck: it's just a matter of getting out in time. For exampleb i've asked my parents to retire / sell their house for years now. i am worried the housing price drop will "rob" them of retirement income while they tell me that lower prices (and higher interest rates) is still good deal for me.
good luck out there, fellas
The takeaway from guaranteed market corrections (and cdn housing prices will go through a collection eventually) is that you can still make a quick buck: it's just a matter of getting out in time. For exampleb i've asked my parents to retire / sell their house for years now. i am worried the housing price drop will "rob" them of retirement income while they tell me that lower prices (and higher interest rates) is still good deal for me.
good luck out there, fellas
When you really look at it, I have had a house for 17 years, it is apparently worth 6-700K. Which would seem OUTRAGEOUS for a small detached home. But if you do the math, for example it has a basement apt that can generate 1K a month, that covers about 350K in carrying costs. So you can live in a 3 brm house while having to pay a 350K mortgage, which is what? about 1200/month? If you put 100K down then it really become very affordable. Which dual income couple cannot afford that?
There are thousands of dual-income couples who cannot afford that, and are renting. Some will be renting for years, decades or all their lives.
People need to learn to save, sure if you are working retail you cannot afford a house, but that has been the case for a very long time. a single school teacher could afford it or a dual income couple making 75-100K combined. Not that rare in Toronto.
Interest rates have been low, but they have always been low. If you look at the high rates in the 80s and to some extent the 90s, those are more anomalous then the rates now. I still say inflation will be low because what has driven inflation in the past has been radically altered by technology.
There really is no pressure on interest rates.
The markets are flush with baby boomer investment money, so borrowing it is cheap - ie a lot of money chasing few opportunities. Also, through monetary policies, the government is keeping interest rates low, to keep more available money in the market, to keep things moving.
Eventually there will be a correction. Whether it be small 15-20% or big 25-30% plus. Then a slow recovery that will take years to rebuild the worth in the property. These corrections have happened many times before, this correction is taking its time. If you are in it for the long term, things will not be so bad. It is the people that can not wait or are speculating that will get hurt.
I honestly think we'll see another serious recession before that bubble bursts. Lets face it, Western economies are in serious trouble. We keep propping them up, all the while heading farther out to sea. The bubble won't burst until we can no longer prop it up.
It will never burst, houses will keep going up 10%+ a year while people get laid off, full time work turns in to low paying part time jobs and the canadian people take on more record debt.
In 10 years from now we'll be selling 2 million + 70 year old shit bungalows with no garage. Or that's atleast what the real estate board, real estate agents or anyone else involved in real estate will have you believe.
This country is in for a shock, when that will be i wish i knew, but it will come.
In 10 years from now we'll be selling 2 million + 70 year old shit bungalows with no garage. Or that's atleast what the real estate board, real estate agents or anyone else involved in real estate will have you believe.
This country is in for a shock, when that will be i wish i knew, but it will come.
