Real Estate

Did we just hit the peak of the Toronto RE bubble?

  • Last Updated:
  • Dec 14th, 2017 3:05 pm
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Apr 9, 2006
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GT-EH
^_^ Not really surprised here...

It's all supply & demand forces at work which I've said has been the culprit numerous times.
I just like to collect things! ¯\_(ツ)_/¯
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Dec 5, 2015
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Thornhill, ON
alanbrenton wrote:
Mar 9th, 2017 3:46 pm
Damn. More job competition and immigrants in the working.

http://www.theglobeandmail.com/report-o ... e34246962/
Not really.. There's way more jobs than qualified applicants...Keyword being qualified...We are so short on skilled workers with good technical skills and experience..Lots of garbage applicants

We've had to hire from abroad the last few positions at much higher expense with visas and relocation. US workers are easier with tn visas but US job market is very tight too and we've gone across the ocean now when we hire
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Jun 4, 2010
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GiOBoY wrote:
Mar 20th, 2017 1:20 pm
^_^ Not really surprised here...

It's all supply & demand forces at work which I've said has been the culprit numerous times.
What's interesting is the YOY price increase for Mid-month March 2017 35.1% compared to 27.7% for February 2017. Is the YOY price increase going to continue in an upward pattern over the spring real estate cycle?

Also the condo apartments show a YOY price increase of 30.9% for Mid-month March 2017 compared to 19.2% for February 2017.
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Mar 31, 2008
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Doubleshot wrote:
Mar 20th, 2017 1:30 pm
Not really.. There's way more jobs than qualified applicants...Keyword being qualified...We are so short on skilled workers with good technical skills and experience..Lots of garbage applicants

We've had to hire from abroad the last few positions at much higher expense with visas and relocation. US workers are easier with tn visas but US job market is very tight too and we've gone across the ocean now when we hire
This is great for property owners. More higher earning rental applicants.
Deal Addict
Feb 29, 2008
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Eh, was talking to an agent the other day who's been in the industry for 2 decades. His advice was to sell. Really made me think.
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Oct 16, 2007
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JayLove06 wrote:
Mar 21st, 2017 7:44 am
Eh, was talking to an agent the other day who's been in the industry for 2 decades. His advice was to sell. Really made me think.
Where are you going to live? :)
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May 18, 2015
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Thornhill, ON
boumbo wrote:
Mar 21st, 2017 8:09 am
Where are you going to live? :)
Pssst... A friend of mine just sold a (paid off) detached in Markham for $1.6M and now she's renting an identical house on the same block for $2k.

... except now she's an actual millionaire (cash in the bank) with no debt, living on the SAME block, SAME house... but it sucks cuz her friends be hating on her for being a "renter"

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JayLove06 wrote:
Mar 21st, 2017 7:44 am
Eh, was talking to an agent the other day who's been in the industry for 2 decades. His advice was to sell. Really made me think.
And let me guess.. buy another one.. higher priced using the same agent.
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jonkoktosen wrote:
Mar 21st, 2017 9:22 am
Pssst... A friend of mine just sold a (paid off) detached in Markham for $1.6M and now she's renting an identical house on the same block for $2k.

... except now she's an actual millionaire (cash in the bank) with no debt, living on the SAME block, SAME house... but it sucks cuz her friends be hating on her for being a "renter"
$2k rental is a steal. Then once the landlord wants to unload, then what? That rental arrangement (I'm guessing) won't be for too long and your friend will likely have to move somewhere where the rent will be market value or a smaller place with a similar monthly rental.

The cap rate is 0.015 and that doesn't include expenses/maintenance when renting the place out. The landlord is not in the right state of mind to be allowing this rental arrangement to go on for a few years. The opportunity cost (if the market will have peaked 2-3 years out) if he wants to sell is too great.
Last edited by alanbrenton on Mar 21st, 2017 9:23 am, edited 1 time in total.
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May 18, 2015
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Thornhill, ON
alanbrenton wrote:
Mar 21st, 2017 9:23 am
The landlord is not in the right state of mind
I agree. The landlord was insane to have bought in at these ridiculous prices while expecting a positive return on investment.

Then again, RE only goes up so cap rate shmap rate, he'll surely make it up on appreciation. After all Markham is a world class suburb of a world class city and there are millions of Chinese millionaires waiting to snap up his property for ever increasing prices in perpetuity. He can't lose.
[OP]
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Dec 5, 2009
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$2K rent on a $2M house is crazy cheap. Certainly not the norm around here.
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Oct 10, 2009
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fdl wrote:
Mar 21st, 2017 10:14 am
$2K rent on a $2M house is crazy cheap. Certainly not the norm around here.
Based on carrying costs, what should the rent be on a $2m house ? Say one is just covering the interest of 2.5% on a $2m loan ... that's 50k rent per year.
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alexinvestor wrote:
Mar 21st, 2017 11:11 am
Based on carrying costs, what should the rent be on a $2m house ? Say one is just covering the interest of 2.5% on a $2m loan ... that's 50k rent per year.
You cannot determine rental rate by your carrying cost. It doesn't work that way. You can put it out for rent but if you are asking for too much, there will be no takers, unless they're expats and the company is paying for their housing costs.

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