Real Estate

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

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Deal Expert
Feb 29, 2008
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Tarrana & The Ri…
sircheersa wrote: It's crazy to me that this spring will mark the 2 year point from the crazy high peak in 2017.

Seems to me we already had a peak, correction and we are already over a year into relative stagnation.

I am starting to think the current numbers, moderate price growth and low sales, are what we will see for the next 4-5 years until another buying frenzy.

The thing with less demand and affordability is it also impacts those who wanted to upgrade or downgrade. Many people will see it as not worth it and just stay put. Low inventory and lower sales, which is what we see now. We have had low sales for what, 18 months? Inventory has not piled up.

Even my neighbor who is retired was going to sell and downsize but when he looked at the market and transaction costs he said it wasn't worth it, will just stay put. Had he sold in 2017 he would have gotten more for his house and paid less for a condo but now it's just not worth it.
Yea, you're right. I think shutting out 1st time home buyers is the biggest issue. Without them, it's hard for the 1st time sellers to upgrade and others to downgrade. Then everyone in the lineup gets stuck. We're not at a point where people have to sell, so we'll just see less properties up on the market. Prices will stay. Sellers will have to be real with themselves. Builders will get a dose of reality as well.
Deal Expert
Feb 29, 2008
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Tarrana & The Ri…
joepipe wrote: this is sort of correct , not sure if the gov is looking for a stagnant market, but they are definitely in hit the brakes mode. They see debt levels as the biggest threat to the economy with rising rates.

The LOC qualifying rules put in by the banks last week were interesting because they were not OSFI rules like B20, in this case the banks did this move on their own.

I do agree though that price gains from years before are over, maybe even flat for a while....

But the sellers are still being very stubborn with asking prices , which is making listings sit for months.....
Sellers, including builders. I think banks will start laying off people IMO.
Deal Fanatic
Jul 30, 2003
6632 posts
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Toronto
Bullseye wrote: I'm neither bull nor bear, but I can share some anecdotal info about Burlington...we moved from there last year (sold in Sept), so still have lots of friends and family in the area. They all agree that we wouldn't get now what we sold for then. My old neighbour has his house for sale and just dropped the price by $100k. A friend has a house up for sale for what seems like a low price compared to last year, and is getting zero showings. He calls it the 'silent collapse'. However another friend in Hamilton just sold for well over asking.
I see same thing happening in west end. Average may not have moved so much but you can certainly see there "deals" around. As soon there are more and more deals - then current balance will not hold.
Bullseye wrote: I also saw someone post about interest rates and housing prices, so wanted to post this again;

https://www.theatlantic.com/business/ar ... es/241504/

'"The link between interest rates and home prices is empirically pretty weak at best," says housing economist Tom Lawler. His analysis is frequently featured on the popular Calculated Risk blog. Although some researchers have tried to link home prices to inflation-adjusted interest rates, the result have been "mixed and ambiguous," according to Lawler.

Yale economist and S&P/Case-Shiller Home Price Index godfather Robert Shiller agrees. "There is not a tight fit at all between the two: high mortgage rates do not translate automatically into low home prices," he says'
Completely agree - I mapped Canadian rate change VS Price Change and at-best you can say: Only when direction of interest rate change, there is a small shock to prices. We are way past direction of interest (from negative to positive) so that is not so relevant.
What is an issue is affordability. When things do become too good to be true, they usually are. Rents have gone minimum $500 in last 6 months or so.
Talking to people who are making 100k can't afford to move (buy or new rents) - The fundamentals will have to come into play?
joepipe wrote:
I agree there is a design in the back - but do you really think our gov't will be able to control it? I think things will go down (not a crash but deflation) - you can't keep them stagnate in ever moving economy like ours.
Canadian business landscape is changing and we are not sure what the final form will be. Sentiments are a big factor that effecting pricing.
sircheersa wrote: It's crazy to me that this spring will mark the 2 year point from the crazy high peak in 2017.

Seems to me we already had a peak, correction and we are already over a year into relative stagnation.

I am starting to think the current numbers, moderate price growth and low sales, are what we will see for the next 4-5 years until another buying frenzy.

The thing with less demand and affordability is it also impacts those who wanted to upgrade or downgrade. Many people will see it as not worth it and just stay put. Low inventory and lower sales, which is what we see now. We have had low sales for what, 18 months? Inventory has not piled up.

Even my neighbor who is retired was going to sell and downsize but when he looked at the market and transaction costs he said it wasn't worth it, will just stay put. Had he sold in 2017 he would have gotten more for his house and paid less for a condo but now it's just not worth it.
I see that too - its just not worth it.
$800k gets you really amazing detach in very nice area (not TO though).
2 bd condo are going over $600k + Maint fees.

Something gotta give soon.
GTA Housing: Supply is the only Metrics that Matters ... until its solved.
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Deal Expert
Feb 29, 2008
21738 posts
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Tarrana & The Ri…
Some people don't realize that Toronto is urbanizing at break neck speed. This is happening all over the world. The detach crowd better get familiar. We will be seeing more condos in the near future. Detach will remain in the burbs for those who don't mind spending 2 hours out of the day commuting, an hour out of their weekend cutting the lawn and some extra hours just upkeeping a house. Convenience is a huge factor that never seems to be considered.

Imagine having to go to the grocery store, LCBO, pharmacy and grab some food. Downtown that can take you 15-20 minutes. In the burbs, it could take you over an hour as it is likely not all can be done in the same plaza. Just a small example of the convenience that people discount.

Don't discount the amount of people who will pay top dollar for convenience!!!
Banned
Feb 23, 2009
1670 posts
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Oshawa
sircheersa wrote: It's crazy to me that this spring will mark the 2 year point from the crazy high peak in 2017.

Seems to me we already had a peak, correction and we are already over a year into relative stagnation.

I am starting to think the current numbers, moderate price growth and low sales, are what we will see for the next 4-5 years until another buying frenzy.

The thing with less demand and affordability is it also impacts those who wanted to upgrade or downgrade. Many people will see it as not worth it and just stay put. Low inventory and lower sales, which is what we see now. We have had low sales for what, 18 months? Inventory has not piled up.

Even my neighbor who is retired was going to sell and downsize but when he looked at the market and transaction costs he said it wasn't worth it, will just stay put. Had he sold in 2017 he would have gotten more for his house and paid less for a condo but now it's just not worth it.
Wow. A Bearish post from a Bull.
What happened to RE always goes up and keep buying you can't lose?
Shouldn't you buy now and it's always worth it?
You constantly post that you can't and shouldn't time the market...but now you say it's a bad time?!?
Why the change?
Sr. Member
Jan 27, 2018
534 posts
523 upvotes
JayLove06 wrote: Some people don't realize that Toronto is urbanizing at break neck speed. This is happening all over the world. The detach crowd better get familiar. We will be seeing more condos in the near future. Detach will remain in the burbs for those who don't mind spending 2 hours out of the day commuting, an hour out of their weekend cutting the lawn and some extra hours just upkeeping a house. Convenience is a huge factor that never seems to be considered.

Imagine having to go to the grocery store, LCBO, pharmacy and grab some food. Downtown that can take you 15-20 minutes. In the burbs, it could take you over an hour as it is likely not all can be done in the same plaza. Just a small example of the convenience that people discount.

Don't discount the amount of people who will pay top dollar for convenience!!!
Getting the grocery, lcbo, pharmacy, homedepot cannot get done in an hour in the burds... This list will take at least 4 hours unless you are running in the stores and hurry up in the stores... That will still take you 2-3 hours....
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Jan 6, 2011
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Unknownname wrote: Getting the grocery, lcbo, pharmacy, homedepot cannot get done in an hour in the burds... This list will take at least 4 hours unless you are running in the stores and hurry up in the stores... That will still take you 2-3 hours....
That's why people prefer value from the location over the size of land and condo will continue to outperform.

These are first time home buyers. Their buying of suburb home won't happen at least for another decade.
Deal Expert
Feb 29, 2008
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Unknownname wrote: Getting the grocery, lcbo, pharmacy, homedepot cannot get done in an hour in the burds... This list will take at least 4 hours unless you are running in the stores and hurry up in the stores... That will still take you 2-3 hours....
Yes. I've been driving around the burbs the last few weekends. It reminds me how much time is wasted driving from one place to the other. Traffic everywhere. Downtown, you can jut walk. Where I live I can walk to the pharmacy, 3 grocery stores, 2 different timmies and a host of other shops ad restaurants within a 10 minute radius. This is what I pay for. And IMO can't put a dollar value on this convenience.
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Jan 6, 2011
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JayLove06 wrote: Yes. I've been driving around the burbs the last few weekends. It reminds me how much time is wasted driving from one place to the other. Traffic everywhere. Downtown, you can jut walk. Where I live I can walk to the pharmacy, 3 grocery stores, 2 different timmies and a host of other shops ad restaurants within a 10 minute radius. This is what I pay for. And IMO can't put a dollar value on this convenience.
Im just not sure urbanization itself is a useful metric. I have seen both rise and fall in price when urbanization trends up/flatten.

Lots of other metrics are supporting your argument though, i.e. vacancy.
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Dec 30, 2012
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Toronto
webdoctors wrote: $700k for a detached house in non-ghetto Scarborough is a no-brainer.
Which block is the non-ghetto section of Scarberia?
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Feb 29, 2008
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Why is Scarborough called ghetto? Too many immigrants?
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Jan 22, 2003
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JayLove06 wrote: Yes. I've been driving around the burbs the last few weekends. It reminds me how much time is wasted driving from one place to the other. Traffic everywhere. Downtown, you can jut walk. Where I live I can walk to the pharmacy, 3 grocery stores, 2 different timmies and a host of other shops ad restaurants within a 10 minute radius. This is what I pay for. And IMO can't put a dollar value on this convenience.
So its -15C outside in the Winter, and you're going to walk shop to shop? Where do you live that you can walk to Costco? How would you carry everything back to your condo? Diapers, toiletpaper, water softener 20lb bags, 10lb detergent containers . The only Wholefoods downtown is at yorkville. When you want asian food you'll walk to the T&T on the docks off Cherry St? In the suburbs you don't have to search for parking, every store has their own lot. Living at 7 and Warden, I can be at Costco/WholeFoods/T&T/HomeDepot/Longos/LCBO in <10mins. I can do my shopping twice a month rather than weekly. Suburbs are awesome.
JayLove06 wrote: Why is Scarborough called ghetto? Too many immigrants?
Too many shootings.
__
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Feb 29, 2008
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Tarrana & The Ri…
webdoctors wrote: So its -15C outside in the Winter, and you're going to walk shop to shop? Where do you live that you can walk to Costco? How would you carry everything back to your condo? Diapers, toiletpaper, water softener 20lb bags, 10lb detergent containers . The only Wholefoods downtown is at yorkville. When you want asian food you'll walk to the T&T on the docks off Cherry St? In the suburbs you don't have to search for parking, every store has their own lot. Living at 7 and Warden, I can be at Costco/WholeFoods/T&T/HomeDepot/Longos/LCBO in <10mins. I can do my shopping twice a month rather than weekly. Suburbs are awesome.
Are you serious? First of all, there is something called PATH, it is connected to plenty of shops and grocery stores. I can name 10 grocery stores off the top of my head that can be accessed underground. Even Whole Foods can be accessed by the condo above and surrounding condos. A quick 5 minute walk in the cold, no different than the 5 minute walk to your car and the other 5 minutes it takes to heat up your car, and the other 5 minutes it takes to wipe the snow off of it. Then having to contend with driving in that weather and looking for parking.

I can't believe I have to explain how living in urban environments makes for more convenience. You can walk 2 blocks and have access to 20+ stores. Driving, you need to know where you are going. If your plaza doesn't have the tore you're looking for, you're going to another plaza. Anyways, if you don't get it, you don't get it, no point explaining.

Also discounting an entire region because of crime is stupid. There are plenty of good areas in Scarborough. We all know "ghetto" isn't a term used for too many shootings. It's a catch all word used to describe something unsavoury.
Last edited by JayLove06 on Nov 11th, 2018 5:46 pm, edited 1 time in total.
Sr. Member
Jan 27, 2018
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webdoctors wrote: So its -15C outside in the Winter, and you're going to walk shop to shop? Where do you live that you can walk to Costco? How would you carry everything back to your condo? Diapers, toiletpaper, water softener 20lb bags, 10lb detergent containers . The only Wholefoods downtown is at yorkville. When you want asian food you'll walk to the T&T on the docks off Cherry St? In the suburbs you don't have to search for parking, every store has their own lot. Living at 7 and Warden, I can be at Costco/WholeFoods/T&T/HomeDepot/Longos/LCBO in <10mins. I can do my shopping twice a month rather than weekly. Suburbs are awesome.



Too many shootings.
As mentioned, there are multiple stores everywhere in DT so getting anything is not a problem and you dont need to stock up on 20 pounds of rice bags or sugar bags or so as they are available in small quantities in stores and buy what you need when you need on your way back from work or when you are picking up your coffee... Dont need a mission weekend day to haul the sacks/boxes of week or two weeks or months worth of items to stock up... You can manage same if you live around STC as well as transit is very accessible... Can't say same for other burbs/areas unless they are same accessible as STC or DT.
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Feb 29, 2008
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Unknownname wrote: As mentioned, there are multiple stores everywhere in DT so getting anything is not a problem and you dont need to stock up on 20 pounds of rice bags or sugar bags or so as they are available in small quantities in stores and buy what you need when you need on your way back from work or when you are picking up your coffee... Dont need a mission weekend day to haul the sacks/boxes of week or two weeks or months worth of items to stock up... You can manage same if you live around STC as well as transit is very accessible... Can't say same for other burbs/areas unless they are same accessible as STC or DT.
No use explaining this to a suburb dweller married to their car. I have friends just like that. Completely incapable of understanding the convenience of living downtown and not needing a car.
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Mar 13, 2017
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I need to come in here more often, I forgot how much fun this thread is.

re Urban vs Suburb, why does one have to be better than the other, can't it just be different?

When we first got married we lived in a downtown condo. Fantastic lifestyle pre kids. Loved it. Only used car on weekends, walked everywhere. Restaurants, condo gym, hanging out with friends after work - great time of our lives.

Now that we've got lots of kids, we're in the burbs. Love this lifestyle too. Kids playing street hockey, backyard summer bbq's, backyard ice rinks, etc. We live in an area where I could walk to a grocery store and even a downtown strip, but with kids you need a car to truck it all home anyway.

It's a cycle .. those condo owners clocking good appreciation will be detach suburb buyers all over again. Please don't tell me "this time it's different".
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Feb 29, 2008
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1cat2dogs wrote: I need to come in here more often, I forgot how much fun this thread is.

re Urban vs Suburb, why does one have to be better than the other, can't it just be different?

When we first got married we lived in a downtown condo. Fantastic lifestyle pre kids. Loved it. Only used car on weekends, walked everywhere. Restaurants, condo gym, hanging out with friends after work - great time of our lives.

Now that we've got lots of kids, we're in the burbs. Love this lifestyle too. Kids playing street hockey, backyard summer bbq's, backyard ice rinks, etc. We live in an area where I could walk to a grocery store and even a downtown strip, but with kids you need a car to truck it all home anyway.

It's a cycle .. those condo owners clocking good appreciation will be detach suburb buyers all over again. Please don't tell me "this time it's different".
It's not about what's better but more about explaining why someone would rather live in a condo downtown than a house in the burbs. They aren't building detached houses in the city so it's either townhouses or condos. Nothing you or anyone can do about it. This is what happens in big cities. Not hard to understand.

Not everyone wants kids. Condo life is a lifestyle. Some people woudln't dare live in the burbs in a big house, some people wouldn't dare live in a condo in the city. It is what it is...but one thing is for sure, condos are here to stay and they will continue to have value.
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Dec 17, 2009
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JayLove06 wrote: Some people don't realize that Toronto is urbanizing at break neck speed. This is happening all over the world. The detach crowd better get familiar. We will be seeing more condos in the near future. Detach will remain in the burbs for those who don't mind spending 2 hours out of the day commuting, an hour out of their weekend cutting the lawn and some extra hours just upkeeping a house. Convenience is a huge factor that never seems to be considered.

Imagine having to go to the grocery store, LCBO, pharmacy and grab some food. Downtown that can take you 15-20 minutes. In the burbs, it could take you over an hour as it is likely not all can be done in the same plaza. Just a small example of the convenience that people discount.

Don't discount the amount of people who will pay top dollar for convenience!!!
Have you ever lived in the suburbs? You're making a really big generalization about the suburbs, or are you confusing rural areas with the suburbs?

I can get in my car in my garage within 5 seconds, drive to a Walmart, Costco, 3 grocery stores, Shoppers. etc., etc., all within less than 10 minutes (I live at Bayview and Elgin Mills, feel free to verify what is around me on Google maps). I don't have to lug stuff around like toilet paper, paper towels, laundry detergent. I just throw them in my trunk and drive home. Carrying a bunch of stuff is also a lot easier into a house vs. a condo building, and it's even worse when the elevator is in service or broken (I have lived in many condos in my life time, it happens all the damn time).

I mean, it's just personal preference really, but you made it seem like people who lives in the suburbs are all isolated and not close to any amenities, which is simply not true.
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Feb 29, 2008
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S52B wrote: Have you ever lived in the suburbs? You're making a really big generalization about the suburbs, or are you confusing rural areas with the suburbs?

I can get in my car in my garage within 5 seconds, drive to a Walmart, Costco, 3 grocery stores, Shoppers. etc., etc., all within less than 10 minutes (I live at Bayview and Elgin Mills, feel free to verify what is around me on Google maps). I don't have to lug stuff around like toilet paper, paper towels, laundry detergent. I just throw them in my trunk and drive home. Carrying a bunch of stuff is also a lot easier into a house vs. a condo building, and it's even worse when the elevator is in service or broken (I have lived in many condos in my life time, it happens all the damn time).

I mean, it's just personal preference really, but you made it seem like people who lives in the suburbs are all isolated and not close to any amenities, which is simply not true.
I have, but it is not rocket science why some people prefer the downtown, city life over suburbs. This shouldn't even be a discussion. People have their own preferences.

People in the suburbs have access to the same amenities as downtown, but it is simply not on the same level. Not even close.
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Jul 3, 2007
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webdoctors wrote: So its -15C outside in the Winter, and you're going to walk shop to shop? Where do you live that you can walk to Costco? How would you carry everything back to your condo? Diapers, toiletpaper, water softener 20lb bags, 10lb detergent containers . The only Wholefoods downtown is at yorkville. When you want asian food you'll walk to the T&T on the docks off Cherry St? In the suburbs you don't have to search for parking, every store has their own lot. Living at 7 and Warden, I can be at Costco/WholeFoods/T&T/HomeDepot/Longos/LCBO in <10mins. I can do my shopping twice a month rather than weekly. Suburbs are awesome.



Too many shootings.
Scarborough has nothing on northwest Toronto, Kipling and Albion road area, Rexdale, Jane / finch, has had over 50% of shootings this year, cops just reported last week.... Scarborough is actually quite safe in general....

Downtown Toronto is getting worse every day as well with junkies and thugs everywhere.....

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