Real Estate

Merged: GTA RE Bubble Bursting Bearish news and updates

  • Last Updated:
  • Nov 12th, 2017 10:36 am
Deal Fanatic
Feb 9, 2009
5845 posts
3110 upvotes
Ceryx wrote:
May 16th, 2017 6:31 am
Pretty sure you are mark77.

Deflationary environment will boost the value of the currency spending.power, but it will not strengthen currency.

Only mark77 I know is claiming falling re will boost Canadian dollar when all economist know it will weaken it.
Mark77 -- wrong since the day he arrived... still going at it.
Deal Fanatic
May 1, 2012
7007 posts
3444 upvotes
Markham
Ceryx wrote:
May 16th, 2017 6:31 am
Pretty sure you are mark77.

Deflationary environment will boost the value of the currency spending.power, but it will not strengthen currency.

Only mark77 I know is claiming falling re will boost Canadian dollar when all economist know it will weaken it.
We don't see eye to eye, but here we are in agreement. Dis dude definitely Mark77.
Deal Fanatic
Feb 9, 2009
5845 posts
3110 upvotes
Too many priced out renters on this forum. Too many of them no idea whats going on or else they would have bought years ago. Desperate to get out of their parents basements. Will try to put every little bearish news possible here to even get a small correction (why not give a few of these guys a bone).

Though the trend is to bring in more investment dollars here with free trade (Europe, Pan Asia and China). If they get even a semi-free trade agreement with China, it's practically all over for the bears here as they will run here to buy everything and anything possible.

Be wary of crash predictions. In the Mid 70s after a large runup of almost a decade, there was a flatline for several years... this was the chance for the bears to get in (and many did) until the late 80s run up which was far worse and far sharper collectively than the last 2 years in Toronto with sharp rate increases almost doubling from 6 to 11%. With the cooling measures the bears were handed a bone here to flatline or even slight tiny correction. Instead of praying for 50% crash start looking now. Many first timers here should just focus on getting in and stop worrying about the 3000 sq foot house your never going to be able to afford anyways.
Deal Fanatic
May 1, 2012
7007 posts
3444 upvotes
Markham
Sanyo wrote:
May 16th, 2017 1:40 pm
Too many priced out renters on this forum. Too many of them no idea whats going on or else they would have bought years ago. Desperate to get out of their parents basements. Will try to put every little bearish news possible here to even get a small correction (why not give a few of these guys a bone).
I know for a fact that you are wrong here. Why? Because I know for a fact that everyone on this forum makes six figures and has seven figure investment portfolios. Everyone claims it, so it must be true.
Deal Addict
Oct 6, 2015
1300 posts
684 upvotes
Ceryx wrote:
May 16th, 2017 6:31 am
Deflationary environment will boost the value of the currency spending.power, but it will not strengthen currency.
If Canadian consumers have no money (since 71% of families own real estate which would be losing value at such point), and the banks aren't lending, its pretty easy to see that imports would crash. That strengthens currency.

Your typical family would cut back on the discretionary stuff first. Vacations. Where do most people take their vacations? In places where US dollars are spent. So there's bound to be a lot less demand for US dollars, hence the Canadian dollar should strengthen considerably against the USD$.

The Bank of Canada will have to fight this aggressively to keep the export sectors of the Canadian economy running. But they're already pretty close to 0% rates, so they will have a lot of trouble.
Deal Fanatic
May 31, 2007
5000 posts
2104 upvotes
skipper1979 wrote:
May 16th, 2017 12:30 pm
Engine of growth in economy is always who create productive jobs.
RE doesnt create jobs on its own without job being created in economy by amazon or similar. Most people buy houses when they have jobs and economy is good. Not other way around.
Crash in AMZN? You dont have any rationale why it would crash. Just because you alone think its over valued? Considering AMZN has potential to grow 10 times in next 10 years its severely under valued today.
Good luck with shorting AMZN. you were not successful in last 20 years. Stock has rocketed 64,000% in 20 years. Based on analyst estimates may be it would crash 20% after its has run up 500%.
I am no ways saying AMZN wont crash, but probability of it crashing below current price point is less than probability of lightening hitting you twice in your life time.
That is correct, over leveraged home owner is at high risk when economy stalls. And re corrects. Home equity is trapped and unproductive, this will not save economy from slowing.
Deal Fanatic
Feb 9, 2009
5845 posts
3110 upvotes
Anikiri wrote:
May 16th, 2017 1:41 pm
I know for a fact that you are wrong here. Why? Because I know for a fact that everyone on this forum makes six figures and has seven figure investment portfolios. Everyone claims it, so it must be true.
LOLLLL oh yeah i forgot it's rfd -- the cream of the crop.
Deal Fanatic
Feb 9, 2009
5845 posts
3110 upvotes
burnt69 wrote:
May 16th, 2017 1:51 pm
If Canadian consumers have no money (since 71% of families own real estate which would be losing value at such point), and the banks aren't lending, its pretty easy to see that imports would crash. That strengthens currency.

Your typical family would cut back on the discretionary stuff first. Vacations. Where do most people take their vacations? In places where US dollars are spent. So there's bound to be a lot less demand for US dollars, hence the Canadian dollar should strengthen considerably against the USD$.

The Bank of Canada will have to fight this aggressively to keep the export sectors of the Canadian economy running. But they're already pretty close to 0% rates, so they will have a lot of trouble.
So Mark what should we do move to Syria?
Deal Addict
User avatar
Jun 11, 2005
1145 posts
306 upvotes
Jungle wrote:
May 16th, 2017 1:28 am
Why is this occurring all the sudden? It appears like something catastrophic has changed.
imo the market just needed something (anything) to tip them over (i.e. new regulations) to create a sense of panic and start the selloff as they dont want to be the last one out the door

though it probably is just a temporary effect, dont think it will last as there are many people sitting on the sidelines waiting for deal
Deal Fanatic
Feb 9, 2009
5845 posts
3110 upvotes
Jungle wrote:
May 16th, 2017 2:23 pm
That is correct, over leveraged home owner is at high risk when economy stalls. And re corrects. Home equity is trapped and unproductive, this will not save economy from slowing.
Economy hasnt stalled yet (atleast in GTA_ so let's wait for that to happen first.
Deal Fanatic
May 31, 2007
5000 posts
2104 upvotes
Blehh wrote:
May 16th, 2017 2:29 pm
imo the market just needed something (anything) to tip them over (i.e. new regulations) to create a sense of panic and start the selloff as they dont want to be the last one out the door

though it probably is just a temporary effect, dont think it will last as there are many people sitting on the sidelines waiting for deal
I wonder if the surge in listings is just the speculators wanting to cash in now that the outlook is murky.
Deal Fanatic
May 1, 2012
7007 posts
3444 upvotes
Markham
burnt69 wrote:
May 16th, 2017 1:51 pm
If Canadian consumers have no money (since 71% of families own real estate which would be losing value at such point), and the banks aren't lending, its pretty easy to see that imports would crash. That strengthens currency.

Your typical family would cut back on the discretionary stuff first. Vacations. Where do most people take their vacations? In places where US dollars are spent. So there's bound to be a lot less demand for US dollars, hence the Canadian dollar should strengthen considerably against the USD$.

The Bank of Canada will have to fight this aggressively to keep the export sectors of the Canadian economy running. But they're already pretty close to 0% rates, so they will have a lot of trouble.
Long time no see, Mark. Not enough spice over at Garth's vapid blogs?
Deal Addict
Jan 16, 2009
3741 posts
1417 upvotes
Toronto
burnt69 wrote:
May 16th, 2017 1:51 pm
If Canadian consumers have no money (since 71% of families own real estate which would be losing value at such point), and the banks aren't lending, its pretty easy to see that imports would crash. That strengthens currency.

Your typical family would cut back on the discretionary stuff first. Vacations. Where do most people take their vacations? In places where US dollars are spent. So there's bound to be a lot less demand for US dollars, hence the Canadian dollar should strengthen considerably against the USD$.

The Bank of Canada will have to fight this aggressively to keep the export sectors of the Canadian economy running. But they're already pretty close to 0% rates, so they will have a lot of trouble.
Canada will be facing similar situation like Japan did with aging population and real estate bubble.

Japan has been experiencing deflation after the real estate bubble pops in 1991. Asset price is deflating which makes money more valuable (as oppose to inflation). however, we are talking about like a 0.5% on annual basis, which is really not much.

That being said, Japanese Yen has been depreciating for a long 10 years+ (80 to 120) during the bubble deflation as weak economy almost guarantee FDI is leaving the country with central bank low rate policy.

This is not rocket science and Mark77 is the only person I know who get confused with deflation=>currency appreciation.
Deal Addict
Jan 16, 2009
3741 posts
1417 upvotes
Toronto
Sanyo wrote:
May 16th, 2017 1:40 pm
Too many priced out renters on this forum. Too many of them no idea whats going on or else they would have bought years ago. Desperate to get out of their parents basements. Will try to put every little bearish news possible here to even get a small correction (why not give a few of these guys a bone).

Though the trend is to bring in more investment dollars here with free trade (Europe, Pan Asia and China). If they get even a semi-free trade agreement with China, it's practically all over for the bears here as they will run here to buy everything and anything possible.
If so much FDI(foreign Direct investment) comes to Canada, why would the CDN depreciate against most major currency? Shouldn't they be going up because people wants Canadian assets (use their currency to exchange CDN).

The reality is most of the growth in real estate is driven by credit and baby boomer looks for yield/retirement income. This is why The market becomes very volatile in the end of the bull cycles as the cheap credit are coming the end.

This is why we are seeing record high rent to price ratio (which is similar to price to earning ratio in stock or yield for bonds, the ability for the asset to generate income) which usually signals the end of the very long bull market driven by the boomer.

We all know how it works out for Japan and it's interesting to see a good financial argument that why you want to buy a 1.4 million house when you can rent for 3000 monthly.
Deal Expert
User avatar
Apr 21, 2004
44301 posts
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Lots more listings where I live but at ridiculous asking prices. Maybe the sellers things there are greater fools out there, haha.

What indicators determine the peak of the r/e market if sellers are too stubborn to lower their prices?

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