Canada's 'housing bubble' deemed close to bursting - Page 12

Highinthesky · #**221** Posted: **May 8, 2012, 11:20 PM**

They know that 80% of the Toronto condo market is speculators because they have sent a questionnaire to every purchaser of a condo in the Toronto. It simply asked did you buy your condo to live in, invest in, or speculate on?

If that were true then you could actually put some faith into the 80% number, otherwise it is nothing more than an educated guess at best.

caltrane74 · #**222** Posted: **May 9, 2012, 4:15 AM**

The bubble will burst, Toronto condo construction will stop.

It just to happen to bring balance to the force.

telyou · #**223** Posted: **May 9, 2012, 12:24 PM**

Quote:

Originally Posted by Berklon

That's why I mention that you look for lights over an extended period of time. It's not scientific, but it has merit. But really, you can ask people who currently live in the condo building and just ask. I've done that with many - there are MANY empty units. It's not exactly a secret. I know people who are looking into buying a condo in Toronto - and the amount of units available to them is so staggering (even within a single building) that it's tough for them to make a decision.

It's not different in Canada... or Vancouver... or Toronto. Low interest rates and greed will turn this into a mess.

You can't make that assumption from the number of lights on.

Quote:

Originally Posted by Waterlooson

Yeah, and who would want to spend anymore time in a 500 sq. ft. place than they absolutely had too with all the restaurant and entertainment options around them?... Those fat no-life turds in the burbs have an unfair advantage... they've got space! Imagine... 1,800 sq. ft. of living space - outrageous. Just don't think that someone might be a little jealous.

1000+sq.ft. unit at the Met........trust me I'll survive.
And i lived in Laval for a 1 year period. So i know the burbs fairly well. All my Montreal friends live in Laval or the West Island so i'm always in the burbs when i visit.

osmo · #**224** Posted: **May 9, 2012, 3:29 PM**

The lights thing is valid. It is not scientific but it is common sense. The majority if these condos ate fused by unit styles. If a lot of one bedroom units are empty you see a significant block of darkness for a few floors in a building. Closer examination you see nothing on the balconies or no blinds. You don't need a Phd to figure out nobody is living there. When space is tight the balconies are almost utilized in some fashion in the warmer months. Take a stroll down the waterfront at 9 or 10 pm and you will see the empty units. I have done this 3 times now.

11k condo units sit empty in the GTA with the majority in Toronto. This with 80k units in the pipeline being built or to be built. 20% of inventory sits empty while trying to add more units onto this. It's a joke and defies logic. The market is upside down.

caltrane74 · #**225** Posted: **May 9, 2012, 3:45 PM**

urbandreamer had a great analogy:

The prices of condos/real estate in Toronto is tightly correlated to the price of Gold.
When the price of gold starts coming down, so too will the price of Toronto condos and real estate.

Looks like Toronto real estate has become the global safe haven for cash...

Berklon · #**226** Posted: **May 9, 2012, 7:48 PM**

Quote:

Originally Posted by caltrane74

urbandreamer had a great analogy:

The prices of condos/real estate in Toronto is tightly correlated to the price of Gold.
When the price of gold starts coming down, so too will the price of Toronto condos and real estate.

Looks like Toronto real estate has become the global safe haven for cash...

LOL... wow, just wow.

Hey everybody! It's different here! Really, it is!

caltrane74 · #**227** Posted: **May 9, 2012, 10:01 PM**

Quote:

Originally Posted by Berklon

LOL... wow, just wow.

Hey everybody! It's different here! Really, it is!

That is only if you believe Toronto has become a global safehaven for international cash.

#globalsafehaven

WhipperSnapper · #**228** Posted: **May 9, 2012, 10:35 PM**

I'd rather put my eggs in global interest rates trending upwards than "the gold factor".

osmo · #**229** Posted: **May 9, 2012, 10:54 PM**

Quote:

Originally Posted by caltrane74

urbandreamer had a great analogy:

The prices of condos/real estate in Toronto is tightly correlated to the price of Gold.
When the price of gold starts coming down, so too will the price of Toronto condos and real estate.

Looks like Toronto real estate has become the global safe haven for cash...

Gold is tightly bonded to speculation as people chase gold and always buy it to high. Gold has maintained steady value for hundreds if years but it's open to steep rises like anything else. Bonds and gold have always been smoke indicators of what is "actually" happening in the real economy.

Here's a even more basic premise ...Supply vs Demand (see my previous post).

caltrane74 · #**230** Posted: **May 9, 2012, 11:15 PM**

There is also hope amoung many investors, both international (foriegn) and Domestic that there is a chance, they can leverage their capital in the Toronto Real Estate market and make hundreds of thousands of dollars. There is a fair amount of greed happening in the wealthy neighbourhoods of Toronto. I know a couple fellows, that have used the increased values of their detached homes in the 416 ( from 500k to 1 million dollars) and used this to finance the purchase of additional homes and condos in Toronto and Mississauga. - They have now become super leveraged, but they are also collecting 10's of thousands of dollars in rent payment from their tenants.

It is likely the fastest means of becoming a millionaire in Toronto, as the other options to do so, such as having a job, have long dried up in this city.

#houserich

caltrane74 · #**231** Posted: **May 10, 2012, 7:45 AM**

Awesome article on why the Toronto condo bubble is not a bubble at all

http://news.google.com/news/url?sa=t...189/story.html

Global Trends, Economic and Demographics driving the Toronto Condo Boom

http://www.canadianrealestatemagazin...g-condo-market

Fear of a bubble persist in Canadian Condo Market

http://www.montrealgazette.com/homes...656/story.html

caltrane74 · #**232** Posted: **May 10, 2012, 3:39 PM**

Condo Market Ripe for Correction

http://business.financialpost.com/20...-a-correction/

caltrane74 · #**233** Posted: **May 10, 2012, 10:42 PM**

More indepth analysis of the Canadian Housing Bubble.

http://m.theglobeandmail.com/report-...service=mobile

Martin Mtl · #**234** Posted: **May 11, 2012, 12:48 AM**

Quote:

Originally Posted by caltrane74

More indepth analysis of the Canadian Housing Bubble.

http://m.theglobeandmail.com/report-...service=mobile

In depth ? Not really.

MTLskyline · #**235** Posted: **May 11, 2012, 12:54 AM**

Quote:

Originally Posted by caltrane74

Condo Market Ripe for Correction

http://business.financialpost.com/20...-a-correction/

Hmm.. Would it be safe to assume that prior to the 2007/2008 financial crisis, most condos in Toronto were bought by people who intended on residing in them, whereas after, an increasing number were purchased as investments?

caltrane74 · #**236** Posted: **May 11, 2012, 1:11 AM**

Hey Condo Owner! Why so glum?

http://m.theglobeandmail.com/life/ho...service=mobile

rbt · #**237** Posted: **May 11, 2012, 2:19 AM**

Quote:

Originally Posted by caltrane74

Hey Condo Owner! Why so glum?

If 0.1% of the GTA population decided the suburban lifestyle wasn't for them, that's ~50,000 units downtown.

1% of the population deciding the suburban lifestyle is no longer for them would result in 500,000 new condo units in urban centers. This boom since 2000 has been the equivalent of about 0.25% of the population moving into condos.

A culture change like that takes a decade or two before even a low percentage finds it acceptable and a generation or two for the majority to accept it.

From my own acquantances it seems like a larger percentage are interested in living downtown than in 2000 and may go somewhere else along Yonge as a fallback (Eglinton or North York).

Yes, a pause is coming. It's what happens after the pause that is going to be interesting. Do we stall for a decade, do we start building out the suburbs again, or is it a culture shift and downtown living comes back with a vengence.

If this is the beginning of a culture shift; then watch-out because the 2020's will make this look like the calm period, especially if Metrolinx fails to dramatically increase transit capacity. Of course, the majority of buildings will be built for the average joe rather than Yuppie couples without kids, so expect a lot more "Star of Downtown" quality buildings.

Ironically, I think implementation of a solid GO REX service is what will kill downtown condomania.

Me&You · #**238** Posted: **May 11, 2012, 2:24 AM**

Quote:

Originally Posted by rbt

If 0.1% of the GTA population decided the suburban lifestyle wasn't for them, that's ~50,000 units downtown.

1% of the population deciding the suburban lifestyle is no longer for them would result in 500,000 new condo units in urban centers.

A culture change like that takes a decade or two for the followers to decide it is a good thing for them and to get on board.

From my own acquantances it seems like a larger percentage are interested in living downtown than in 2000 and may go somewhere else along Yonge as a fallback (Eglinton or North York).

Yes, a pause is coming. It's what happens after the pause that is going to be interesting.

If this is the beginning of a culture shift; then watch-out because the 2020's will make this look like the calm period. Of course, the majority of buildings will be built for the average joe rather than Yuppie couples without kids, so expect a lot more "Star of Downtown" quality buildings.

Ummm, wanna check your math again? 1% of the GTA housing units = 500,000? So there's 50,000,000 units in the GTA? No wonder some think there's a housing bubble...

renthefinn · #**239** Posted: **May 11, 2012, 2:36 AM**

^^That math looks off by a factor of 10, and then you also assume that every person equals a unit?

davidivivid · #**240** Posted: **May 11, 2012, 1:07 PM**

Quote:

Too hot? Higher than expected home prices renew concerns of Canadian bubble

OTTAWA • As home prices continue their steady ascent, the volume of debate over the too-hot or just-about-right market is also getting turned up.

Politicians and monetary policy-makers are warning consumers to tackle their debt loads now, while many analysts argue that is already happening and house prices are still in a healthy range.

Few are suggesting a market crash is imminent, but this week’s spate of strong housing data has renewed concerns the market is dangerously close to overheating and heading for a bubble.

The latest salvo came Thursday, with Statistics Canada data showing new home prices climbing 0.3% in March — the 12th monthly increase in row — and just above forecasts. When compared to 12 months earlier, prices were up 2.6%.

[...]

http://business.financialpost.com/20...nadian-bubble/