Real Estate

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

  • Last Updated:
  • Feb 3rd, 2023 4:08 pm
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Deal Guru
Feb 9, 2009
12381 posts
11307 upvotes
chopperE wrote: That is seriously scary. Anything can cause a $200 hit to your wallet at any given month. So many random things in life.
You know whats scary -- what our gov't owe ;)
Jr. Member
Oct 14, 2012
129 posts
150 upvotes
Toronto
Occupancy date is 2020, I planned to rent it out,

I'm still living comfortably with the parents and paying rent lol, What I planned was If for any reason I needed to move out it would be nice to have a condo to move into immediately, but it wasn't like something I needed, it was more of an investment. So now I'm hesitating as I still have a chance to get out of the contract.
Deal Addict
Jan 26, 2016
2240 posts
2272 upvotes
Toronto, ON
@Jungle
You have to take these surveys with a grain of salt

1) It is a Canada-wide poll.
2) People are spending a whole lot on discretionary spending, and you can expect those to take a back seat to compensate.
3) A lot of jobs and a lot of the growth in GDP comes from housing and related industries. In fact, all the growth in Feb 2017 GDP was due to real estate industry.

Image



If rates increase, then you will expect #2 and #3 to be adversely affected. That will mean a lot of job loss and decreased GDP, which in turn will keep BoC in check when it comes to raising rates. So BoC may try to increase rates, but will be forced to reduce once its effect propagates in the industry.

Also, if you read the report, income increase is still stagnant at 1%, well below inflation. That signals BoC will be in no hurry to increase rates.
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May 8, 2017
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boing388 wrote: Occupancy date is 2020, I planned to rent it out,

I'm still living comfortably with the parents and paying rent lol, What I planned was If for any reason I needed to move out it would be nice to have a condo to move into immediately, but it wasn't like something I needed, it was more of an investment. So now I'm hesitating as I still have a chance to get out of the contract.
Are you able to rent it out at a rate that covers all of your costs? Why are you hesitating? Do you have any other investments?
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Follow my journey through the Toronto housing bubble on Twitter: @SoSudsy
Deal Addict
Jul 3, 2007
4153 posts
4626 upvotes
Toronto
Anyone have this article in full? I dont have globe unlimited....

Im hearing a lot of purchases cant close and its causing a major spillover effect for the sellers who bought....

Another article quoted one house in burlington bought for $1.085 million in Feb got re-appraised for $875k in May !!!

https://www.theglobeandmail.com/news/to ... e35270886/
Penalty Box
Dec 27, 2013
8003 posts
4050 upvotes
Toronto
joepipe wrote: Anyone have this article in full? I dont have globe unlimited....

Im hearing a lot of purchases cant close and its causing a major spillover effect for the sellers who bought....

Another article quoted one house in burlington bought for $1.085 million in Feb got re-appraised for $875k in May !!!

https://www.theglobeandmail.com/news/to ... e35270886/
ouch. that's definitely something people need to be aware of.
Deal Addict
Jan 26, 2016
2240 posts
2272 upvotes
Toronto, ON
joepipe wrote: Anyone have this article in full? I dont have globe unlimited....

Im hearing a lot of purchases cant close and its causing a major spillover effect for the sellers who bought....

Another article quoted one house in burlington bought for $1.085 million in Feb got re-appraised for $875k in May !!!

https://www.theglobeandmail.com/news/to ... e35270886/
Here is the trick to read it - on the page click Alt-A to select all, the Ctrl-C to copy, then paste in notepad to read.

Edit: But this is a video so that wouldn't work. If it were text you could read like that.
Banned
Aug 19, 2016
1903 posts
762 upvotes
WinterSleep wrote: Here is the trick to read it - on the page click Alt-A to select all, the Ctrl-C to copy, then paste in notepad to read.

Edit: But this is a video so that wouldn't work. If it were text you could read like that.
Thanks a lot buddy. Now they know and will plug the whole soon.
Deal Addict
Jan 26, 2016
2240 posts
2272 upvotes
Toronto, ON
daivey wrote: ouch. that's definitely something people need to be aware of.
Seems pretty much in line with what we saw in Vancouver after FBT

MAY/17 - $1,830,900 *** ALL-TIME HIGH ***
APR/17 - $1,767,200
MAR/17 - $1,714,100
FEB/17 - $1,758,800
JAN/17 - $1,501,800

DEC/16 - $1,676,200
NOV/16 - $1,612,400
OCT/16 - $1,598,800
SEP/16 - $1,532,200
AUG/16 - $1,470,300 <-- price drop of 300k
JUL/16 - $1,764,600
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May 8, 2017
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WinterSleep wrote: Seems pretty much in line with what we saw in Vancouver after FBT

MAY/17 - $1,830,900 *** ALL-TIME HIGH ***
Vancouver's completely different from Toronto. First they introduced the interest free down payment matching plan ("HOME") in Jan, 2017, which developer loved but pretty much everyone else said was a bad idea: http://vancouversun.com/news/local-news ... homebuyers

Second, they didn't have the MASSIVE FLOOD of listings that Toronto is now experiencing, which is still going strong.

So unless Wynne does something equally as stupid as giving away free loans for down payments as BC (I wouldn't put it past her), and unless the supply dries up, it's not likely to happen here. Totally different.
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Deal Expert
Feb 22, 2011
16505 posts
21844 upvotes
Toronto
SmugDruggler wrote: Vancouver's completely different from Toronto. First they introduced the interest free down payment matching plan ("HOME") in Jan, 2017, which developer loved but pretty much everyone else said was a bad idea: http://vancouversun.com/news/local-news ... homebuyers

Second, they didn't have the MASSIVE FLOOD of listings that Toronto is now experiencing, which is still going strong.

So unless Wynne does something equally as stupid as giving away free loans for down payments as BC (I wouldn't put it past her), and unless the supply dries up, it's not likely to happen here. Totally different.
Vancouver had a much larger decrease in sales than Toronto did, they also had more listings. They also had more foreign investment.

You don't think the government will intervene if the market dips too much? They will only intervene if it's growing too fast?
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May 8, 2017
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rjg4235 wrote: Vancouver had a much larger decrease in sales than Toronto did, they also had more listings. They also had more foreign investment.

You don't think the government will intervene if the market dips too much? They will only intervene if it's growing too fast?
The province and the Bank of Canada have pretty much said that we're in a bubble and they know it. I don't know if they'll intervene on the way down, and I certainly wouldn't bet on it.
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Deal Expert
Feb 22, 2011
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SmugDruggler wrote: The province and the Bank of Canada have pretty much said that we're in a bubble and they know it. I don't know if they'll intervene on the way down, and I certainly wouldn't bet on it.
When have Libs ever let a market crash without doing anything to try and curb it? I really can't think of a single example. Last time there was a crash they increased amortization and reduced lending requirements. We used to have 40 year mortgages, they only recently reduced it to 30 max, even that requires 20%.
Last edited by sircheersa on Jun 10th, 2017 4:48 pm, edited 1 time in total.
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May 8, 2017
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rjg4235 wrote: When have Libs ever let a market crash without doing anything to try and curb it? I really can't think of a single example.
There's an election next year. The likelihood of the Liberals winning is slim.
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Sr. Member
Dec 3, 2013
615 posts
256 upvotes
Brampton/waterloo
rjg4235 wrote: Vancouver had a much larger decrease in sales than Toronto did, they also had more listings. They also had more foreign investment.

You don't think the government will intervene if the market dips too much? They will only intervene if it's growing too fast?
market went over 30%, yoy at peak, since then its only down less than 10%, and if we go for long term growth at 5%, we can still go down 15% to go to "regular more normal growth"
Government intervened after 2 years of signfiicant growth, I feel like government will intervene again maybe if theres significant decrease, not "less growth"

We just sold our house, expected 1.25m in April, rejected an offer of 1.182m ended up having to take 1.155m when comparables sold up to 1.3m in peak but now those people are at risk of dropping the deals.
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May 8, 2017
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rjg4235 wrote: What you think conservatives will win Ontario? Fat chance. NDP was the one with the loan idea in Vancouver so i don't think you're any better off with them.
Sounds like housing has guaranteed upside and no downside. You should leverage yourself up and buy more of it. Way up.
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Follow my journey through the Toronto housing bubble on Twitter: @SoSudsy
Deal Expert
Feb 22, 2011
16505 posts
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SmugDruggler wrote: Sounds like housing has guaranteed upside and no downside. You should leverage yourself up and buy more of it. Way up.
I 100% will. I have properties generating positive cash flow, tenants paying down my mortgage and long term leveraged appreciation.

Obviously I know there are short term fluctuations but to expect prices to go down long term is absurd.
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Sep 8, 2007
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Way Out of GTA
RamneekSingh76 wrote: market went over 30%, yoy at peak, since then its only down less than 10%, and if we go for long term growth at 5%, we can still go down 15% to go to "regular more normal growth"
Government intervened after 2 years of signfiicant growth, I feel like government will intervene again maybe if theres significant decrease, not "less growth"

We just sold our house, expected 1.25m in April, rejected an offer of 1.182m ended up having to take 1.155m when comparables sold up to 1.3m in peak but now those people are at risk of dropping the deals.
Ouch $27,000 up in smoke.
Sr. Member
Dec 3, 2013
615 posts
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Brampton/waterloo
cartfan123 wrote: Ouch $27,000 up in smoke.
well it was more than just that, cuz after rejecting it we spent another couple k emptying and cleaning out basement as tenants were living there, but its still not really a big deal as last year we had only expected $1m for the house, still got 155k more than what we expected. now that 155k can be used to buy another house, if market drops further.
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RamneekSingh76 wrote: well it was more than just that, cuz after rejecting it we spent another couple k emptying and cleaning out basement as tenants were living there, but its still not really a big deal as last year we had only expected $1m for the house, still got 155k more than what we expected. now that 155k can be used to buy another house, if market drops further.
Yeah that's a reasonable way of looking at it. Got it sold still for good money and move on.

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