Real Estate

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

  • Last Updated:
  • May 23rd, 2017 12:07 am
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Sr. Member
Jan 30, 2006
833 posts
256 upvotes
BiegeToyota wrote:
May 14th, 2017 7:56 am
How about this?

For the first time in hundreds of years thanks to information technology more and more people are becoming aware about the real value of money. Asians don't invest in real estate because they are stupid, but because they have been screwed over many times over in the past. You can argue as much as you want that real estate is not a safe investment, but to many it is the safest investment available. They also like gold for the very same reason, although gold does not give steady returns until after the fact.

I come from a country that had a decade long war (Yugoslavia) and 2nd highest hyperinflation after Zimbabwe. Even then the real estate did not lose any value (at least in the biggest cities) before or after the war,
what you say is definetely not true

high inflation always decreases real prices as credit becomes unavailable

during hyperinflation real prices can easily go down 90% as most of income will be diverted to fool and utlities. Some properties might go close to zero in real term (although nominally sharply higher)

any pick up in inflation and real prices will collapse even in Canada

Asians definetely have no idea about value of money. They will be stripped by westrners from their new found wealth as usual
Penalty Box
Feb 13, 2017
369 posts
292 upvotes
kashirin wrote:
May 15th, 2017 12:48 am
what you say is definetely not true

high inflation always decreases real prices as credit becomes unavailable

during hyperinflation real prices can easily go down 90% as most of income will be diverted to fool and utlities. Some properties might go close to zero in real term (although nominally sharply higher)

any pick up in inflation and real prices will collapse even in Canada

Asians definetely have no idea about value of money. They will be stripped by westrners from their new found wealth as usual
It's safe to say with the price of oil probably not going anywhere anytime soon, and the loonie looking as weak as ever (and will still probably go down), we might not see any hyperinflation in a very very very long time.
Jr. Member
Jun 24, 2011
146 posts
54 upvotes
West Lafayette, Indi…
kashirin wrote:
May 15th, 2017 12:48 am
what you say is definetely not true

high inflation always decreases real prices as credit becomes unavailable

during hyperinflation real prices can easily go down 90% as most of income will be diverted to fool and utlities. Some properties might go close to zero in real term (although nominally sharply higher)

any pick up in inflation and real prices will collapse even in Canada

Asians definetely have no idea about value of money. They will be stripped by westrners from their new found wealth as usual
When I see a post with multiple "definetely" in it, I know the poster is a priced-out bear who lacks self-confidence on so many levels.

There are more Chinese millionaires than the population of Canada. Just saying.
Member
User avatar
Dec 13, 2016
352 posts
247 upvotes
IndustrialKid wrote:
May 15th, 2017 9:23 am
When I see a post with multiple "definetely" in it, I know the poster is a priced-out bear who lacks self-confidence on so many levels.

There are more Chinese millionaires than the population of Canada. Just saying.
This is not even to be taken as a joke... and not only Chinese.

Indians, Malaysians, Singaporeans Thai and lately even Vietnam are joining the ranks of common global millionaires. Except Philippines. Still no hope for Filipinos... that's why they want to get the hell away from their country so much.

People really need to use their Canadian passports and travel a bit.

Hopefully travel and meet some real middle class people and not the prostitutes as most foreigners get stuck with.
Deal Addict
Jan 16, 2009
3381 posts
1094 upvotes
Toronto
crocp8 wrote:
May 15th, 2017 8:18 am
It's safe to say with the price of oil probably not going anywhere anytime soon, and the loonie looking as weak as ever (and will still probably go down), we might not see any hyperinflation in a very very very long time.
I don't think we will ever see hyperinflation. If you have followed Japan's bubble/aging population, it's usually the deflation we have to worry about.

We could see asset deflation for a very long time, especially housing as government taps into them as new source of revenue due to spending on social service for old people.
Newbie
May 8, 2017
96 posts
125 upvotes
IndustrialKid wrote:
May 15th, 2017 9:23 am
When I see a post with multiple "definetely" in it, I know the poster is a priced-out bear who lacks self-confidence on so many levels.

There are more Chinese millionaires than the population of Canada. Just saying.
BiegeToyota wrote:
May 15th, 2017 9:47 am
This is not even to be taken as a joke... and not only Chinese.
China has 1.3 million millionaires, hardly the population of Canada.
http://www.cnbc.com/2015/10/13/countrie ... aires.html

Even the United States, the country with the most millionaires in the world, doesn't have more millionaires than Canada's population. (15.7M millionaires for those who don't want to click).
Penalty Box
Feb 13, 2017
369 posts
292 upvotes
IndustrialKid wrote:
May 15th, 2017 9:23 am
When I see a post with multiple "definetely" in it, I know the poster is a priced-out bear who lacks self-confidence on so many levels.

There are more Chinese millionaires than the population of Canada. Just saying.
Do you just blatantly make up lies all the time?....just saying....
Deal Addict
Feb 9, 2009
3378 posts
991 upvotes
SmugDruggler wrote:
May 16th, 2017 8:59 am
Behold! The wealthy Chinese who will price you out of your homes!
Again lots of Chinese keep money/other valuables in their homes hidden and undeclared. The prices of a home in major city centers are far more than here.

And the average adult in North America has 330k in assets? Are you kidding me, there is no way.

I never trust studies since they use an extremely small sample size and can't account for cash.

And many people in the east do not like to disclose their true wealth to people (well most some do) for fear of losing it. It's different when you live in a communist country that's opened up economically.
Deal Addict
Nov 24, 2013
3704 posts
889 upvotes
Kingston, ON
Sanyo wrote:
May 16th, 2017 9:33 am
And the average adult in North America has 330k in assets? Are you kidding me, there is no way.
Average? Absolutely. Average != Median. It's taking $92 trillion in total North American wealth and dividing it over 274 million North American adults. Distribution matters.

That's also $330K average wealth (financial assets + non-financial assets - debts), not just assets.


Distribution matters for China too. Wealth per capita could be low, but with a worked-to-death underclass and a gilded top 1-2%. And, if you think about it, the top 2% of China is 20 million people.
Newbie
Aug 16, 2013
66 posts
10 upvotes
crocp8 wrote:
May 16th, 2017 8:58 am
Do you just blatantly make up lies all the time?....just saying....
As a banker (holding no interests in your discussion) who deals with international Chinese clients, I can guarantee you there are more than 40 million Chinese with over 1 million in household networth.
This is largely due to the fact of the economic boom and "asset bubbles" in China where people bought houses for 100,000 RMB in the 90s that have appreciated 100x in value. Not even exaggerating. :)
Sr. Member
Sep 14, 2007
504 posts
43 upvotes
The income gap disparity in China is huge. The poor have nothing while the rich are loaded. You can't look at the average of China as a whole. The rich are the ones coming from the major cities. The farmers are all poor until the developers come to buy up their land.
Jr. Member
Jun 24, 2011
146 posts
54 upvotes
West Lafayette, Indi…
Veritate wrote:
May 16th, 2017 10:29 am
As a banker (holding no interests in your discussion) who deals with international Chinese clients, I can guarantee you there are more than 40 million Chinese with over 1 million in household networth.
This is largely due to the fact of the economic boom and "asset bubbles" in China where people bought houses for 100,000 RMB in the 90s that have appreciated 100x in value. Not even exaggerating. :)
Major cities like Beijing, Shanghai, and Shenzhen are seeing prices double in a year or two. The new condo developments are asking for $5000/sqft these days. So Toronto with its $1000/sqft waterfront condos is dirt cheap. Cheap like Detroit, MI.
Newbie
Aug 16, 2013
66 posts
10 upvotes
IndustrialKid wrote:
May 16th, 2017 10:45 am
Major cities like Beijing, Shanghai, and Shenzhen are seeing prices double in a year or two. The new condo developments are asking for $5000/sqft these days. So Toronto with its $1000/sqft waterfront condos is dirt cheap. Cheap like Detroit, MI.
Yes you're right. Even though that growth has slowed significantly, it has gone on that way for the past 15 years, and that is where many Chinese have made their fortunes.
However, I will add that it is folly to compare Toronto, a city with relatively little economic activity outside of RE related industries, to cities like Shanghai and Beijing which are the forefront of emerging market economic growth and hub for international economic actvitity.
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