[RTD]

Seeing as how this country has experienced crazy ups and downs in the housing market over the last decade or so, I thought we should have a thread dedicated to share each regions housing market and varying trends with the entire country.

My apologies if there has been a thread created for this already. If so, may the mods feel free to close this thread and place the relevant posts on an existing thread, should there be one.

[RTD]

http://www.theglobeandmail.com/report-on-business/economy/housing/winnipeg-set-to-be-hottest-housing-market/article1859524//

WINNIPEG TO BE HOTTEST HOUSING MARKET THIS YEAR IN CANADA


"Forget Vancouver or Toronto. Winnipeg is poised to be Canada's hottest housing market this year.

In fact, 2011 is shaping up to be the year of the mid-sized city with St. John's, Fredericton, Regina and Saskatoon also enjoying some of the strongest price increases in the country.

A lot of first-time buyers are already being priced out of large urban centres. With the Bank of Canada expected to resume interest-rate increases later this year, affordability will become a bigger issue for even more buyers."

...

"Winnipeg, however, is expected to eclipse that national average by posting a 7-per-cent gain this year. That easily outpaces the 3.7-per-cent increase expected for Vancouver and the 1-per-cent gain forecast for Toronto.

“It [Winnipeg] is the Canadian poster child for a well-diversified economy,” said Mr. Soper, adding the key drivers include agriculture, resources, manufacturing and public-sector employment. “They are not a one-trick pony like Calgary or St. John's, where you see really dramatic upswings, but a really solid reliable economy over the last decade and affordable home prices.”

Adrienne Warren, senior economist with the Bank of Nova Scotia, said the Winnipeg housing market remains “tight” in terms of supply. A positive population trend and strong demand will push prices higher."

[SpongeG]

Vancouver real estate sales fall in 2010, but beginning to stabilize

http://www.theprovince.com/business/4066663.bin
The residential benchmark price for Greater Vancouver increased 2.7 per cent to $577,808 between December 2009 and 2010. Prices, however, have decreased 2.6 per cent since hitting a peak of $593, 419 in April 2010.
Photograph by: Wayne Leidenfrost, PNG

Real estate sales in Greater Vancouver in 2010 were down substantially from 2009 but still better than 2008, the year of the credit crisis and collapse of the U.S. housing market.

“The last two years have been a bit of a rollercoaster for the real estate market,” said Jake Moldowan, president of the Real Estate Board of Greater Vancouver Wednesday. “However, sales over the past six months have definitely shown a trend toward stability. We think that’s good news for home buyers and sellers.”

The REBGV reported that total sales of detached, attached and apartment properties in 2010 reached 30,595, a 14.2 per cent decrease from the 35,669 sales recorded in 2009.

But that was a 24.2 per cent increase from the 24,626 residential sales in 2008.

...

http://www.theprovince.com/business/Vancouver+real+estate+sales+fall+2010+beginning+stabilize/4066660/story.html?cid=megadrop_story

[PoscStudent]

A bit of a different take on the housing market thing but in the news this week they've been talking about problems with the quality of houses now getting built in St. John's, which they are crediting to the housing boom that was seen over the last few years.

I only paid attention to what was on the radio but people are having problems with mold and shingles falling off all because of the poor construction. There were two women on the radio who have paid $300,000 for their houses and they are now having all these different issues and are having trouble getting the contractors to do anything about it.

[Doug]

Canadain housing prices are very high relative to incomes in the global context. These boosterish articles tend to eminate from agencies with a vested interest in promoting confidence in the housing market. As interest rates rise, and that is only a matter of time as long term rates have already risen significantly, housing prices will suffer. The number of Canadians with six figure mortgages is staggering.

[Berklon]

Canadain housing prices are very high relative to incomes in the global context. These boosterish articles tend to eminate from agencies with a vested interest in promoting confidence in the housing market. As interest rates rise, and that is only a matter of time as long term rates have already risen significantly, housing prices will suffer. The number of Canadians with six figure mortgages is staggering.

Agreed.

The Canadian housing market is due for a major correction and it will start this spring as there'll be a huge supply of homes on the market (more than previous years). The decline will occur even before interest rates rise - that'll just make it worse.

It's sickening how the media are selling out to the RE industry with very misleading and inaccurate articles we're seeing about a healthy housing market in Canada.

[Boreal]

Canadain housing prices are very high relative to incomes in the global context. These boosterish articles tend to eminate from agencies with a vested interest in promoting confidence in the housing market. As interest rates rise, and that is only a matter of time as long term rates have already risen significantly, housing prices will suffer. The number of Canadians with six figure mortgages is staggering.

We have a winner. Absurdly high housing prices are not something to celebrate. Unless of course one actually believes that a property in Winnipeg for worth as much as double (or more?) then a comparable property in Phoenix reflects real economic fundamentals. :sly:

[someone123]

Part of the issue with unaffordable housing markets like Vancouver is that the buyers are coming from abroad. If it were only local buyers then prices would be more in line with local incomes, which are roughly average for Canada.

A preference for detached houses is also somewhat unsustainable in a city like Toronto (which does not have the big stock of cheap inner-city housing of some US cities), although they've already seen a shift toward condos.

[SpongeG]

Vancouver's housing market still rosy

City will lead the nation with 3.7-per-cent rise

By Business Reporter, The Province and Financial Post January 7, 2011

http://www.theprovince.com/business/4073929.bin
The outlook is bright for Vancouver's housing market this year but price increases for condos and detached houses are not expected to approach last year's pace.
Photograph by: Wayne Leidenfrost, PNG files

The average price of a home in Vancouver should climb 3.7 per cent this year, just above the increase expected for the country as a whole, Royal LePage Real Estate Services says.

Interest rates and employment levels will have the greatest influence on house prices in Vancouver this year, the real estate services firm said in a survey released Thursday.

For standard two-storey homes, Vancouver saw year-over-year average price gains of 9.8 per cent in the fourth quarter of last year. That brought the average price of two-storey homes to $1,007,500.

"Detached bungalows followed with year-over-year gains of 7.6 per cent, selling for a fourth quarter average of $891,500," Royal LePage said. "Standard condominiums were close behind, selling for an average price of $484,500, a gain of seven per cent."

Tight supply and high prices in the city's west side are driving up prices on the east side, especially for single-family homes, Royal LePage said.

Nationally, home prices will continue a "moderate and steady climb" this year, helped along by an improving economy and low interest rates, the firm's report said.

The average price of a home in Canada will rise three per cent to $348,600, even as the number of transactions falls two per cent.

...

Read more: http://www.theprovince.com/business/Vancouver+housing+market+still+rosy/4073928/story.html#ixzz1AUK6pQWj

[SpongeG]

Want a two-storey? $1M, please

METRO VANCOUVER
Published: January 07, 2011 5:37 a.m.
Last modified: January 07, 2011 2:39 a.m.

Not even close
Average price of a two-storey house in other Metro markets:
Halifax: $238,000
Montreal: $375,222
Ottawa: $354,083
Toronto: $594,231
Calgary: $404,622
Edmonton: $334,285

The average price of a standard two-storey home in Vancouver has surpassed $1 million and is expected to keep rising, a report by Royal LePage revealed Thursday.

At $1,007,500, Vancouver’s average is $400,000 greater than the average standard two-storey home in Toronto ($594,231), Canada’s next priciest market. And it’s almost three times greater than the across-Canada average of $360,000.

Prices are expected to increase by 3.7 per cent in 2011.

“Some Vancouverites would point to the sunshine and tell you that that’s the reason (prices are higher),” said Bill Binnie, a Vancouver-based broker for Royal LePage.

Binnie, a realtor since 1974, said Vancouver prices have always been the highest in Canada. He credits a number of reasons, including a lack of land, the mild climate and an influx of wealthy people from around the world.

...

http://www.metronews.ca/vancouver/local/article/737082--want-a-two-storey-1m-please

[PoscStudent]

Most affordable hosuing markets.

http://money.ca.msn.com/banking/mortgages/gallery.aspx?cp-documentid=27221268&page=1

[Wishblade]

Most affordable hosuing markets.

http://money.ca.msn.com/banking/mortgages/gallery.aspx?cp-documentid=27221268&page=1

Pfft, Vancouver is on the list? what did they do, only survey 8 cities?

[RTD]

Pfft, Vancouver is on the list? what did they do, only survey 8 cities?

That is exactly what I was thinking. The City of Vancouver (proper) and even The City of Toronto (proper) are definitely NOT among the most affordable housing markets in Canada, by any means.

Some of these surveys are a real joke and are proving to have zero credibility.

[SpongeG]

cities have to be a certain size i think - a city of 20,000 isn't going to count

[freeweed]

You guys are funny. The list clearly has Vancouver as the least affordable, which is why it's #8.

There is one serious flaw with it though - they imply that Calgary is more affordable than Regina. The house they show for Regina would be well over $500,000 these days in Calgary due to the land costs for an 1100 sq ft bungalow.

[PoscStudent]

The list seems to be looking at more than just the actual house price. It mentions about where the house is actually located in the city and if you have to travel far from work to home.

There was a list done last year about affordable housing and it looked at the average salary in the area and how the economy was doing. I know in that list that while houses cost more in some cities they were considered more affordable than others because of income levels.

[itom 987]

The average price for a house in Fort McMurray reached $704,000 in November.

[1ajs]

The average price for a house in Fort McMurray reached $704,000 in November.

wow :O ......

[Highinthesky]

http://www.financialpost.com/news/House+prices+slide+again/4171275/story.html

Four of the six major Canadian housing markets saw declines while only Montreal and Vancouver escaped them. Interesting to note that even with these declines overall housing value are still nearly 5% above the pre-crash peak of 2008.


Metropolitan area / index level / % change m/m / %change y/y

Calgary / 154.21 / -0.7 % / -1.5 %

Halifax / 127.91 / -0.8 % / 2.7 %

Montreal / 135.56 / 0.0 % / 7.1 %

Ottawa / 131.07 / -0.9 % / 7.2 %

Toronto / 124.21 / -0.5 % / 5.1 %

Vancouver / 155.90 / 0.6 % / 5.9 %

National Composite / 137.07 / -0.2 % / 4.9 %

[Vaillant]

talking of homes price...



Montreal 'severely unaffordable'

Ranks second behind Vancouver; Report illustrates how Montreal salaries have failed to keep up with home prices

BY ALLISON LAMPERT, JANUARY 26, 2011


The Gazette

For the first time in years, Montreal-area homes have become less affordable than houses in greater Toronto, a survey by the Frontier Centre for Public Policy says.

Montreal is now ranked as Canada's second-least affordable housing market with one million inhabitants or more -right after Vancouver -the survey published this week by the conservative, Prairies-based think tank says.

The survey results are based on data from the third quarter of 2010. To rate housing affordability, survey authors took the median multiple -median housing price divided by gross annual median household income - in 325 markets in Australia, Canada, Hong Kong, Ireland, New Zealand, Britain and the United States.

Affordable cities have median multiples of around 3.0 -where median house prices are three or less times median household incomes.

Montreal was listed as a "severely unaffordable" market with a median multiple of 5.2, compared with 5.1 for Toronto. The report illustrates how Montreal salaries have failed to keep up with home prices: Only four years ago, the survey ranked Montreal as moderately unaffordable, with a multiple of 3.8 and a ranking just ahead of St. Catharines, Ont.

Yet despite the steady appreciation of Montreal housing prices -even through the recent global economic crisis -other analysts haven't assessed city housing prices as being less affordable than those in Toronto.

While RBC senior economist Robert Hogue wouldn't comment on the Frontier Centre's survey, he said the latest affordability index he authored found Montreal to be more affordable than Toronto in most housing categories.

"In most cases, Toronto would be more expensive and less affordable than Montreal -except for maybe condos," Hogue said.

Overall, homes in Canada cost 4.6 times the average annual salary of just less than $43,000.

"There are a lot of people that tend to be squeezed out of the housing market," said David Seymour, a policy analyst with the Frontier Centre. "Owning your own little patch of Canada is a dream for a lot of people that is getting tougher."

Some cities, such as Windsor, Ont., remain very affordable. The average price of a home in Windsor was $145,000, according to data from the third quarter of last year, only 2.1 times the average median income of $68,900.

Meanwhile, Vancouver is the least-affordable metropolitan area, where the average home costs $602,000 -or 9.5 times the $63,100 median income.

The only cities that fared worse than Vancouver were Sydney, Australia, at 9.6 times the median income, and Hong Kong, at 11.4 times.

Buying a home in the Asian financial hub -synonymous with super-rich tycoons and gleaming office towers -will cost an average of $330,939, out of reach for a population with a median annual income of less than $30,000.

"All bets are off there. None of the normal rules apply," Seymour said.

About 75 of the 325 cities analyzed were labelled "severely unaffordable," where housing costs more than five times the average income.

Along with Vancouver, three other cities in B.C. -Victoria, Abbotsford and Kelowna -fell into that category.

The only two other "severely unaffordable" Canadian cities were Montreal and Toronto.

And while Calgary and Edmonton continue to see rapid growth and soaring home prices, Saskatoon has overtaken the Alberta hubs in terms of housing affordability.

Atlantic Canada is the most affordable market in the country, with housing costing 2.3 times the median income in Fredericton; 2.6 times in Charlottetown; 3.3 times in Halifax; and 3.4 times in St. John's.

alampert@montrealgazette.com

© Copyright (c) The Montreal Gazette


Read more: http://www.montrealgazette.com/business/Montreal+severely+unaffordable/4167729/story.html#ixzz1CCEejbdO

[RTD]

I'm going to request that these posts be moved to the other housing market thread.

[BLACK STAR]

[Four of the six major Canadian housing markets saw declines while only Montreal and Vancouver escaped them. Interesting to note that even with these declines overall housing value are still nearly 5% above the pre-crash peak of 2008.


Metropolitan area / index level / % change m/m / %change y/y

Calgary / 154.21 / -0.7 % / -1.5 %

Halifax / 127.91 / -0.8 % / 2.7 %

Montreal / 135.56 / 0.0 % / 7.1 %

Ottawa / 131.07 / -0.9 % / 7.2 %

Toronto / 124.21 / -0.5 % / 5.1 %

Vancouver / 155.90 / 0.6 % / 5.9 %

National Composite / 137.07 / -0.2 % / 4.9 %


Ummmmm....Wheres Edmonton!:shrug:

[RTD]

[Four of the six major Canadian housing markets saw declines while only Montreal and Vancouver escaped them. Interesting to note that even with these declines overall housing value are still nearly 5% above the pre-crash peak of 2008.


Metropolitan area / index level / % change m/m / %change y/y

Calgary / 154.21 / -0.7 % / -1.5 %

Halifax / 127.91 / -0.8 % / 2.7 %

Montreal / 135.56 / 0.0 % / 7.1 %

Ottawa / 131.07 / -0.9 % / 7.2 %

Toronto / 124.21 / -0.5 % / 5.1 %

Vancouver / 155.90 / 0.6 % / 5.9 %

National Composite / 137.07 / -0.2 % / 4.9 %


Ummmmm....Wheres Edmonton!:shrug:



And Winnipeg :shrug: :shrug:

[dsim249]

And Winnipeg :shrug: :shrug:

And Moose Jaw :shrug: :shrug:

[PoscStudent]

Why didn't this go in the Canadian Housing Market Thread?

[RTD]

^ I've put in a request to the mods to have these posts transfered there.

No need for two housing threads.

[Highinthesky]

Edmonton and Winnipeg are probably 7th and 8th.

[Biff]

It wouldn't be good to include Winnipeg in that list because housing prices in the Peg keep increasing.

www.newswire.ca/en/releases/archive/January2011/06/c8868.html

[Highinthesky]

I think the reason that a city like Winnpeg doesn't make the list is because its a significantly smaller housing market. Average sales prices are also significantly higher in those six markets than other markets in Canada. Also due to their size they are more stable markets over a longer term. Winnipeg might be hot right now and for the past 3 or 4 years but if you compare growth from any of the six listed above to Winnipeg over the past 20 years it wouldn't be close.

[drew]

^ take another look at the list. It includes Halifax, and yes Winnipeg is significantly larger than that city.

[flar]

I wouldn't read too much into the cities chosen, they probably just picked a few from different parts of the country and Halifax is the only large city out east.

[drew]

^ correct, but that was not the point of his post.

Obviously they cherry picked the cities to prove the point of the article.

[someone123]

They select cities in different regions to present more distinct markets and therefore give a better overall impression of the housing industry. Halifax is used as a proxy for the Atlantic region.

[MolsonExport]

A heck of a lot more "ups" than "downs"

We don't have anything comparable to Miami, Las Vegas, Detroit (in terms of "downs"), and Cleveland (where a house is the price of a VCR, see video below)

oZzgAjjuqZM

[Highinthesky]

Agreed Halifax really shouldn't be on the list given the other cities in there but they needed a centre from Atlantic Canada. Although the average sale price is surprisingly high in Halifax.

[SteelTown]

http://video.ca.msn.com/watch/video/2011-real-estate-preview-01-05-11-5-40-pm/jvk2ah9w

2011 Real Estate Preview
2010 was a good year for Canadian residential real estate, with double digit gains early in the year, then tapering to more modest gains in recent months. So what's in store for 2011? BNN speaks to Don Campbell, president, Real Estate Investment Network.

Summed up.....

Over-Achievers
Edmonton
Calgary
Hamilton
K/W

Average
Ottawa
Halifax
Winnipeg
St. John

Under-Achievers
Vancouver
Toronto
Saskatoon
Montreal

[MolsonExport]

why is double digit good? It certainly is not for first-time home buyers. fuking retard commentary. double digit IS NOT SUSTAINABLE in the long run without double digit wage/salary increases.

[freeweed]

why is double digit good? It certainly is not for first-time home buyers.

It is for everyone else.

Plus, it indicates a more healthy economy. Look at the converse - you can buy a house for 85 cents in Detroit right now, and what does that say about the city?

[MolsonExport]

would double digit price increases for other products also be good for everybody else?

inflation indicates a healthy economy? really?

[flar]

Looking at housing only as an investment causes a lot of problems for people who just want their own place to live. A growing number of people in Canada live in precarious housing situations because housing prices have gotten out of control in a lot of places.

[freeweed]

would double digit price increases for other products also be good for everybody else?

Yes, once you've purchased said product. For example, if house prices remain the same, and I want to move to a different city - I have the same amount of money to spend. If my house has appreciated in value, and I move - I now have more money to spend.

inflation indicates a healthy economy? really?

Yes - house prices are fairly closely tied to wages, employment, etc. If everyone is earning $20,000 and the unemployment rate is 15%, house prices will be much lower than in a city where everyone earns $100,000 and unemployment is 5%.

Calgary's house prices didn't go up at insane levels during the last boom because of low supply. They're up because everyone is making a lot more money compared to 10 years ago, and can therefore afford to pay a lot more for a given house. And people who buy here, watch their house appreciate, and move somewhere else are frequently able to now live mortgage free.

This stuff is basic economics. Not sure why the concepts are hard to grasp.

[240glt]

Unm... I think rampant speculation had a lot to do with the huge run-ups in Cal and Edm

[someone123]

Yes - house prices are fairly closely tied to wages, employment, etc.

Actually they haven't been in most markets for the past few years. Recently, during a good year in a strong city wages go up by 3-5% and housing prices go up by 10-15%. Affordability has been going down in most Canadian cities.

There are all sorts of reasons why the housing market is special. The land supply is fixed. There are development policies governing construction. Governments mess around with the availability of credit and interest rates. In cities like Vancouver, foreigners buy houses and do not rely on the local job market for funding.

This stuff is basic economics. Not sure why the concepts are hard to grasp.

You're being pretty condescending for somebody who seems to have an incomplete view of the situation.

[freeweed]

Unm... I think rampant speculation had a lot to do with the huge run-ups in Cal and Edm

Calgary having the highest median wage in the country by a fair margin probably also has something to do with it. This is a city continually called out for uncontrolled sprawl and endless development. It's not a lack of supply that's causing housing price spikes, it's just that there's a ton of money to go around. Of which there still is, which is why we really haven't seen much downward pressure on prices here. Even after the speculators got chased out for the most part.

[freeweed]

Actually they haven't been in most markets for the past few years.

Actually, the markets in Canada with the lowest wages in general continue to see the lowest housing prices. While there are always exceptions I'm sure we can have a nice chat with someone like vid on average wages/housing prices in Thunder Bay, and how that compares to say Toronto or Calgary.

It may not be a perfect match, but it's a damn strong correlation. However, if you do find a place with really high wages and really low housing costs, please let me know - I'd love to move there.

The only real exceptions to this are places with extremely high demand due to quality of living. Victoria stands out, as does Van to a similar degree. However, that only reinforces my point - the high cost of living reflects a place that is in demand. It's a place lots of people want to live in, which makes for a good thing.

As always you guys want to pick a few words and get buried in semantics - the original question was "why are high housing costs a good thing". The fact is that high housing costs almost always indicate a place where people want to be. Whether it's for economic or personal reasons. This is why people tout it as being a positive statement about a region. It means you're in an in demand place.

But hey, if you think low housing costs indicate a good place to be, you can always buy a rural property in northern Saskatchewan. I guarantee you if someone posted a news story talking with great praise about the cheapest places/worst real estate markets in Canada, most if not all of you would be laughing your heads off. Like it or not, most people prefer to live somewhere where real estate costs more on average (but the former causes the latter, not the other way around as some seem keen to try to imply). It's not that someone says "hey, this place is expensive, therefore it's a great place to live!". It's the other way around. Most people understand how that works, which is why I'm astounded when someone does not grasp this. Call it condescending if you want but it seems pretty obvious - people want to live where people want to live. :shrug:

[Highinthesky]

I'm seeing some big time over simplification of some rather complex economic forces on this last page. Wages, supply & demand, location, government influences all affect values and they all do it at the same time.

To say Calgary's last real estate boom is simply because of a sharp increase in wages which made it have one of the highest or highest median wage in the country is simply wrong. The single biggest influence on price is supply & demand, things like wages, location, and government influences merely impact this. The only way you can get double digit increases, like the 15% seen in Calgary between 2004 and 2005, is due to demand out stripping supply. The boom seen during this time was characterized by houses selling the day they were listed and bidding wars driving up prices as sometimes 2, 3, or 4 potential buyers all wanted the same property.

Basic economics will tell you that you can have the highest wages in the world but if supply meets demand perfectly you will have prices increase that match inflation and if you have greater supply than demand price will fall.

[freeweed]

:previous: Well yes, obviously it's not a single determining factor (this is an Internet post, not a 400 page analysis of every possible nuance in life), but the point remains: what drove up demand so highly all of a sudden between 2004 and 2005 - and thereon for the next 3 years or so?

People moving here by the tens of thousands. Why did they move here? It wasn't for the nice winters, nor the swimming. It was easily available and high paying jobs, period. Calgary was building thousands of houses a year at that point and still is for the most part - yet prices remain high even after migration slowed considerably. People have been able to support the prices here (for now, anyway).

High house prices indicate places people want to live. And *generally*, at prices they can afford. While there are pockets of "house poor" folks everywhere, it's certainly not the common case in this country. Else we'd be seeing large corrections like the US did in the recent past.

If no one wanted to live here (or Vancouver, or Toronto, or...) house prices would drop. And quick. Because supply would rapidly overtake demand. High house prices means you're in a place others want to be - this is why people get excited when they hear their local market is up. SUSTAINED high house prices means you're in a place where the average person can afford it - we'll see how long term all of this really is, but having gone through the largest economic correction in several generations, we seem to be doing just fine.

[Highinthesky]

If I had money to invest I'd be looking to the Calgary market for sure. In the short term as long as oil prices stay above 80 then the Calgary market will remain strong. In the longer term it should also remain strong as politicians and business leaders know the oil won't always be there or may not always be in high demand and continue to diversify the economy.

I curious to see the impact of the big international hotels on Toronto. I wonder if they could spur further international investment in the real estate market.

[MolsonExport]

Yes, once you've purchased said product. For example, if house prices remain the same, and I want to move to a different city - I have the same amount of money to spend. If my house has appreciated in value, and I move - I now have more money to spend.



Yes - house prices are fairly closely tied to wages, employment, etc. If everyone is earning $20,000 and the unemployment rate is 15%, house prices will be much lower than in a city where everyone earns $100,000 and unemployment is 5%.

Calgary's house prices didn't go up at insane levels during the last boom because of low supply. They're up because everyone is making a lot more money compared to 10 years ago, and can therefore afford to pay a lot more for a given house. And people who buy here, watch their house appreciate, and move somewhere else are frequently able to now live mortgage free.

This stuff is basic economics. Not sure why the concepts are hard to grasp.

Indeed, what you are projecting is a gross oversimplification (You show me your credentials, and I will show you mine [I am somewhat of an authority on consumer spending], until then, cut out the condescending BS). Market forces (supply and demand) are the main determinant, but there are so many factors influencing supply and demand.

-net migration rates
-international migration rates & source of international migrants
-domestic migration rates & source of domestic migrants
-interest rates, mortgage rates
-influation rates
-employment/unemployment/participation rates
-economic structure
-zoning [arguably one of the main determinants of high costs in Vancouver]
-demographics (including age structure, marital status, number of children)
-stimulus factors (e.g., welcome taxes, CMHC first-time homeowner plans, Mortgage insurance, taxes on new/exisiting Real Estate)
-municipal taxation
-economic growth, structure, and stability
-wages, consumer spending patterns, disposable versus discretionary income, consumer debt, consumer sentiment (e.g., University of Michigan index of Consumer Sentiment is a great leading indicator)
-speculation
-relative desirability of ownership vs. renting (compare Manhattan with Calg)

High house prices indicate places people want to live.

In part, yes. But then, why the relative low costs of sunbelt cities in the USA (much higher in-migration rates, e.g., Atlanta, Houston, Phoenix) compared to say, San Francisco, Boston, etc. (little to no in-migration)?

Remember: correlation does not imply causation.

Yes, once you've purchased said product.

So you are comfortable with double-digit price increases for nondurables (which are a greater proportion of household spending than durables)? Food, fuel, clothing? Prescriptions? How about double-digit price increases for university tuition? double-digit mortgate rates? Public transit?

What about people (e.g., seniors) living on a fixed income? Single-parent families?

I grew up in the 1970s, and I remember the effects of Stagflation.

[240glt]

Calgary having the highest median wage in the country by a fair margin probably also has something to do with it. This is a city continually called out for uncontrolled sprawl and endless development. It's not a lack of supply that's causing housing price spikes, it's just that there's a ton of money to go around. Of which there still is, which is why we really haven't seen much downward pressure on prices here. Even after the speculators got chased out for the most part.

You do know that Edmonton's median wage is only a few K lower than Calgarys' right ?

I sold my Calgary condo at the height of the boom during the speculation frenzy, and watched 4 months later as the place lost $50,000k in value, I saw the same cycle in Edmonton about a half year later. Both cities have near identical patterns in most ways and both recovered somewhat but the pricing runups have almost entirely to do with spec buying and people taking on enormous debts, not just that people have lots of money lying about (with the exception of those who made money on their real estate invesments)

[Highinthesky]

Wages alone mean nothing on the value of property. If they were then one day you would look at a house listed at $300,000. The next day you found you're getting a $50,000 raise you would be willing to spending $350,000 on the same house.

[240glt]

Really the biggest impact wages have on real estate is that they drive the amount of borrowing capacity people have.

[freeweed]

You do know that Edmonton's median wage is only a few K lower than Calgarys' right ?

Wouldn't surprise me at all but I'm not fully aware of the numbers, nor how the real estate market is. I assume they're similar to Calgary from what I've heard - but I didn't feel comfortable generalizing to the entire province in case some nit-picker decided to have at it based on some edge case. I know Edmonton like Calgary saw a huge price runup that just happened to co-incide with the largest increase in real earnings in decades in this country, but I'm sure the two were mostly unrelated.

[freeweed]

Wages alone mean nothing on the value of property. If they were then one day you would look at a house listed at $300,000. The next day you found you're getting a $50,000 raise you would be willing to spending $350,000 on the same house.

Well, about 3x the income raise these days, but that's it in a nutshell. If you're earning $20,000 a year, you'll never qualify for, nor be able to afford a $200,000 house.

If you suddenly are earning $70,000 a year (say, by moving to a different city), then all of a sudden you CAN afford the payments on that house - more specifically, you can find a bank who will lend you the money at reasonable rates and terms.

[harls]

However, if you do find a place with really high wages and really low housing costs, please let me know - I'd love to move there.

Gatineau.. although house prices are catching up rapidly to Ottawa.

[freeweed]

Remember: correlation does not imply causation.

Actually, correlation does not MEAN causation. It sure as hell hints strongly in its direction though. Finding out whether or not there's causation is a matter for further research. I really hate when people misuse this phrase. Correlation is almost always the first step before trying to find causation.



So you are comfortable with double-digit price increases for nondurables (which are a greater proportion of household spending than durables)? Food, fuel, clothing? Prescriptions? How about double-digit price increases for university tuition? double-digit mortgate rates? Public transit?

What about people (e.g., seniors) living on a fixed income? Single-parent families?

I grew up in the 1970s, and I remember the effects of Stagflation.

Hmm. So you are comfortable with the return of Disco, Christianity as a leading religion, analysis of Pac-Man and how it relates to the ecstasy crowd, and dog grooming tips?

No, I am explaining why most people feel a sense of comfort, even pride, when their local real estate market goes up in value - that was the original "I don't understand this" question, to which the answer seems obvious. I'm really not sure at all where you're going with the rest of this. I am not analyzing edge cases, nor people who are not currently "in" the real estate market, nor the price of tea in China.

The question was - why are people happy when real estate values go up a lot? All I'm answering is that. I'm not providing my graduate thesis on how sustainable this is, or what will happen when interest rates inevitably rise, or how urban sprawl is causing climate change, or how illegal immigration is changing the face of the American south.

[freeweed]

Gatineau.. although house prices are catching up rapidly to Ottawa.

Wow, that IS a fairly major difference, considering the proximity. The easiest data I could find is several years old but even still - almost 50% cheaper for the average house.

Any idea why this is? Considering that it's by many definitions just one large city - and wow am I about to set off a shitstorm of screaming with this - is there some perceived detriment to living in Quebec? Why wouldn't someone choose to live in Gatineau instead of Ottawa? Hell, if I could save $100,000 off the price of a house by moving 5 minutes away, I'd do it in a heartbeat! Unless there was some serious demotivating factor...

[Highinthesky]

Absolutely, if someone suddenly makes more money then they can of course afford a more expensive home. However that doesn't automatically mean they would purchase a more expensive house or that they would be willing to pay more for the same things before they got an increase in income.

Housing prices increased in Calgary because demand was greater than supply. The reasons for that increased demand would range from higher wages, a large number of people moving to Calgary, favorable investment environment created by the lack of a Provincial Sale Tax and low rates of Provincial Income Tax, favorable lending conditions with banks eager to lend and longer terms of amortization allowing both investors and regular purchasers to stretch their dollars further.

There are four forces that creat value; Scarcity, Purchasing Power, Utility, and Demand. All four were required for Calgary's boom.

[harls]

Wow, that IS a fairly major difference, considering the proximity. The easiest data I could find is several years old but even still - almost 50% cheaper for the average house.

Any idea why this is? Considering that it's by many definitions just one large city - and wow am I about to set off a shitstorm of screaming with this - is there some perceived detriment to living in Quebec? Why wouldn't someone choose to live in Gatineau instead of Ottawa? Hell, if I could save $100,000 off the price of a house by moving 5 minutes away, I'd do it in a heartbeat! Unless there was some serious demotivating factor...

This is an older article, but it explains quite a bit, worth a read

http://www.tofeeornottofee.com/A%20tale%20of%20two%20cities.pdf

[freeweed]

This is an older article, but it explains quite a bit, worth a read

http://www.tofeeornottofee.com/A%20tale%20of%20two%20cities.pdf

Ah, income taxes. I've never lived close to a cross-border situation so I've never had to work out the differences in things like that. I've heard the stereotype about how Quebec has high taxes but never really looked into it.

Ottawa-Gatineau reminds me of many city-suburb scenarios I've seen in Canada (yes, I realize Gatineau is a city in its own right). When housing is massively cheaper in the suburb and all else is equal, people flock there. Which generally brings housing values up close to the city, unless the suburb is either rather far away or there's some other detrimental factor at play (property taxes, lack of municipal services...). High income taxes would certainly dissuade people in this case - although as the PDF points out, childcare can more than make up for it.

I guess from now on I should preface every single sentence I make here with "ALL ELSE BEING EQUAL". Because all else being equal (taxes, mortgage rates, crime, colour of local ponies) for a property owner it's still perceived as better when property values increase. If the higher values are due to some otherwise undesirable situation, no shit it can be a bad thing. I'd kinda figure that's implied, but I guess not. :shrug:

[Acajack]

Wow, that IS a fairly major difference, considering the proximity. The easiest data I could find is several years old but even still - almost 50% cheaper for the average house.

Any idea why this is? Considering that it's by many definitions just one large city - and wow am I about to set off a shitstorm of screaming with this - is there some perceived detriment to living in Quebec? Why wouldn't someone choose to live in Gatineau instead of Ottawa? Hell, if I could save $100,000 off the price of a house by moving 5 minutes away, I'd do it in a heartbeat! Unless there was some serious demotivating factor...

You hit it bang on. It is ALL about the fact that Gatineau happens to be located in the province of Quebec.

In no particular order, chief detriments (cited by Ottawa homebuyers) about living in Gatineau:

- Income tax: roughly $4,000 more on a $75,000 salary, which eats up a lot of the house price savings right there

- Political uncertainty: not so intense right now, but a lot of people still fear that their property would end up being worth less if it found itself in an independent Quebec

- Language: seems like a lot of people simply don't like being greeted with a "bonjour" everywhere they go, and all that that entails (either learning French, or trying to get service staff to switch to English if they can or feel like it)

- Health care: Gatineau is probably one of the toughest places in Canada to get a family doctor; Ottawa also has health care problems, but they pale in comparison to Gatineau's; as a Gatineau resident with a Quebec health card you *can* treated in some places in Ottawa, but not everywhere

[Acajack]

Ah, income taxes. I've never lived close to a cross-border situation so I've never had to work out the differences in things like that. I've heard the stereotype about how Quebec has high taxes but never really looked into it.

Ottawa-Gatineau reminds me of many city-suburb scenarios I've seen in Canada (yes, I realize Gatineau is a city in its own right). When housing is massively cheaper in the suburb and all else is equal, people flock there. Which generally brings housing values up close to the city, unless the suburb is either rather far away or there's some other detrimental factor at play (property taxes, lack of municipal services...). High income taxes would certainly dissuade people in this case - although as the PDF points out, childcare can more than make up for it.

I guess from now on I should preface every single sentence I make here with "ALL ELSE BEING EQUAL". Because all else being equal (taxes, mortgage rates, crime, colour of local ponies) for a property owner it's still perceived as better when property values increase. If the higher values are due to some otherwise undesirable situation, no shit it can be a bad thing. I'd kinda figure that's implied, but I guess not. :shrug:

If you check out Ottawa-Gatineau on Google Earth, you will see that the built-up area on the Quebec side extends a lot less further than on the Ontario side. In most urban areas the suburbs extend out relatively equally in all directions in a circle around the central city. Unless there is a geographic barrier like the ocean or mountains. But in Ottawa things spread out a lot further on the Ontario side, which probably reflects the fact that roughly 70% of the population in Ottawa-Gatineau are anglophones, and the vast majority of them prefer to stay on the Ontario side.

[freeweed]

Interesting. I never would have thought about the political angle, I still naively think of our country as one cohesive whole. I guess this is one of those rare cases of almost-another-country-but-no-not-really. Correct me if I'm wrong, but there aren't any immigration barriers into Quebec from other provinces, right? Obviously there are things to consider as you mention, but there's no actual process or hassle if I wanted to up and move to Quebec tomorrow...?

I find the language excuse hilarious. If it truly bothered me, I'd just drive the extra 8 seconds into Ottawa whenever I needed something (again, in this way it could be treated as no different than a suburb-city relationship).

[Acajack]

Interesting. I never would have thought about the political angle, I still naively think of our country as one cohesive whole. I guess this is one of those rare cases of almost-another-country-but-no-not-really. ...?).

You might think about it if you were sitting down to sign on a mortgage for several hundred thousand dollars...

Correct me if I'm wrong, but there aren't any immigration barriers into Quebec from other provinces, right? Obviously there are things to consider as you mention, but there's no actual process or hassle if I wanted to up and move to Quebec tomorrow...?).

There are no barriers to people moving between any of the provinces in Canada.

I find the language excuse hilarious. If it truly bothered me, I'd just drive the extra 8 seconds into Ottawa whenever I needed something (again, in this way it could be treated as no different than a suburb-city relationship).

True, and some people actually do this. But the part of Gatineau that is closest to Ottawa (downtown Hull) is not the nicest part of town. So people tend to live a bit further inside Gatineau - not too far though. Many nice neighbourhoods of Gatineau can be found 10 km or less from Parliament Hill. It does get tedious after while though... though a lot of these people work in Ottawa so they probably do their shopping there before they head home.

[freeweed]

You might think about it if you were sitting down to sign on a mortgage for several hundred thousand dollars...

Been there, done that - didn't think about it for a microsecond. ;)

My point was that Ottawa-Gatineau is a pretty unique situation in this country. Most people signing mortgages don't have to worry about whether or not their house will suddenly be part of a new country next year (and those that do are generally deep in Quebec and fully understand the situation).

[Acajack]

Been there, done that - didn't think about it for a microsecond. ;)

My point was that Ottawa-Gatineau is a pretty unique situation in this country. Most people signing mortgages don't have to worry about whether or not their house will suddenly be part of a new country next year (and those that do are generally deep in Quebec and fully understand the situation).

Which is precisely why the vast majority of homebuyers in Ottawa don't really consider Gatineau as a serious option.

[North of 49]

Here are some real estate numbers from Manitoba.

Check out the link. It includes avg prices per year amongst it's larger population centers. Very affordable based on the average.

http://http://www.realestatemanitoba.com/statistics.htm (http://www.realestatemanitoba.com/statistics.htm)

[freeweed]

Nothing like it was, though. I remember being able to buy a pretty decent house in Winnipeg for $60-80,000. These days that might get you a run down dump in PD (no offense to 1ajs and others).

Then again, these were also the days when $30,000 was a pretty good salary in that city. I'm not keen to return to those days. :haha:

[Highinthesky]

I'd ask just how long ago that was but I'm not sure you would tell me :D

[1ajs]

Nothing like it was, though. I remember being able to buy a pretty decent house in Winnipeg for $60-80,000. These days that might get you a run down dump in PD (no offense to 1ajs and others).

Then again, these were also the days when $30,000 was a pretty good salary in that city. I'm not keen to return to those days. :haha:

80k would get u a prity run down house yes but fixable yes.. 130k 150k will get u a house in good shape in my area
acros main u can find the rare 40k house in need of tlc and i think u can still find some decent ones for 80k over there but even then there creeping over 100k mark if not more there are houses on the north side of redwood going for 250k + speacly once u get past mountan i walk allot and go through these areas and have seen great amount of change in what was this cities slums and its improved though elmwood towards talbots taking a slide and something needs to be done about this... there should be no slumds..

11yrs ago for the record a house sold on my street for 1500$

[Highinthesky]

wow $1500 for a house, that must be a record for the country. There must have been something more going there. Could you get a vacant lot in the city at that time for under $1500?

[freeweed]

wow $1500 for a house, that must be a record for the country. There must have been something more going there. Could you get a vacant lot in the city at that time for under $1500?

Nope, not even close to a record. The 90s were not kind to Winnipeg, especially its more run down areas. I had a few opportunities to buy properties for essentially a year's worth of outstanding property taxes, and chose not to - the way real estate was going on dumps like that, paying property tax every year was a losing proposition. There were many a vacant lot being sold in the $500 range.

Wish I had, now - but no one forecast the crazy price hikes Winnipeg has seen over the past 5 years or so.

[Highinthesky]

Oh I see, so these were properties that the city had possessed for failing to pay the property taxes?

[freeweed]

Oh I see, so these were properties that the city had possessed for failing to pay the property taxes?

In my particular case no - the "pay a year of property tax" was tongue in cheek for "this property is insanely cheap". $500-1000 cheap, that sort of thing. Places where the owners wanted out entirely, ie: paying that property tax amount every year cost more than they could conceivably ever make on the property itself, whether by rent or by selling. The sale/tax values may have been similar but no direct connection between them.

I've never even approached foreclosed/seized properties. I've heard of enough pitfalls and I'm anything but a savvy investor.

[Highinthesky]

TD and CIBC have increased their fixed-term mortgage rates yesterday by as much as .25%. Some economits and Real Estate Industry experts have come out saying this is going to hurt the market and drop prices, which are projected to drop 1.5% this year anyway.

Hard to say what kind of affect this will have. I firmly believe that this increase along with the Feds mortgage rule changes will most certainly impact the first time buyers and bottom end of the market in general.

[davidivivid]

Yesterday, Re/Max published a report which evaluates the average price growth of single family homes during the last 10 years. Quebec city saw an average growth of 9,2% per year, average home prices jumping from 90 079$ in 2000 to 237 000$ last year. Quebec was only surpassed by Regina, with an average growth of 9,56%, while London had the weakest progression with 4,82%. Montreal had a yearly growth of 8,48% and the national average was 6,82%.

I do not have the report, only the excerpt of a newspaper article in french:

http://lapresseaffaires.cyberpresse.ca/economie/immobilier/201102/09/01-4368370-prix-des-maisons-de-90-000-a-237-000-a-quebec.php?utm_categorieinterne=trafficdrivers&utm_contenuinterne=lapresseaffaires_LA5_nouvelles_98718_accueil_POS14