Real Estate

Merged: GTA RE Bubble Bursting Bearish news and updates

  • Last Updated:
  • Sep 16th, 2017 10:01 am
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Nice analogy. Government intervention in Vancouver was FBT and vacancy tax, if I'm not mistaken.

In Toronto, it's like 10 measures they put in. One of the brokers on RFD was right, most of the measures are tax grabs/ compliance measures and they want property owners to pay income tax on rentals or pay vacancy taxes and not be able to skip on both.

I almost threw up laughing when I saw from a news article title / body this week (didn't bother reading it) that David Rosenberg is calling the government to raise interest rates. It's kinda obvious that the government should target the hotspots and not kill the whole economy by raising rates. Not sure what Gluskin Sheff & Associates see in this guy but I don't believe a thing he says. It's almost complete rubbish.

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And when landlords on RFD complain about rent control and how that can affect their cash flow positive-ness (they are still getting subsidized mortgage because of the rental income), I think they should just re-assess their situation if they can use their capital elsewhere (i.e. sell) and make better returns elsewhere. If not, I doubt complaining on RFD will help at all.
Last edited by alanbrenton on May 19th, 2017 2:32 pm, edited 2 times in total.
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Not to mention sales dropped 30% in Vancouver whereas in Toronto it was only 3% and it's debatable it was caused by having 1 less business day.
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alanbrenton wrote:
May 19th, 2017 2:32 pm
Nice analogy. Government intervention in Vancouver was FBT and vacancy tax, if I'm not mistaken.

In Toronto, it's like 10 measures they put in. One of the brokers on RFD was right, most of the measures are tax grabs/ compliance measures and they want property owners to pay income tax on rentals or pay vacancy taxes and not be able to skip on both.

I almost threw up laughing when I saw from a news article title / body this week (didn't bother reading it) that David Rosenberg is calling the government to raise interest rates. It's kinda obvious that the government should target the hotspots and not kill the whole economy by raising rates. Not sure what Gluskin Sheff & Associates see in this guy but I don't believe a thing he says. It's almost complete rubbish.

=====

And when landlords on RFD complain about rent control and how that can affect their cash flow positive-ness (they are still getting subsidized mortgage because of the rental income), I think they should just re-assess their situation if they can use their capital elsewhere (i.e. sell) and make better returns elsewhere. If not, I doubt complaining on RFD will help at all.
The 10+ measures won't stop the foreigners from buying.
They say they only make up less than 5% of all transactions. :lol:

Anyway, interest rates are not going anywhere -
if they do go up; it will kill the economy and they'll quickly realize it and reverse it within a year or less.

Governments (both provincial and federal) are also awash in debt.
Rising interest rates will effect their budgets too! ;)

Current inflation is tame / weak @ 1.6%... this reflects a weaker economic view.
Hence, our weak CAD which is helping our economy stay afloat somewhat.
This also helps those foreigners buy our expensive homes. :lol:
Last edited by GiOBoY on May 19th, 2017 3:16 pm, edited 1 time in total.
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squall_13ca wrote:
May 19th, 2017 2:02 pm
anyone in here that had their firm offers to buy in the last few months fall through now? Reason im asking is that we sold a while back on a firm offer and now the bank for the buyer is appraising our property and there is a high chance that they will not appriase it at the value that we sold it for. Im wondering how commonly this scenario is playing out ...
It will be apprised at value you sold unless it went like a million over asking. Banks approved 200-300-400 almost all the time.
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Mar 20, 2017
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rjg4235 wrote:
May 19th, 2017 2:35 pm
Not to mention sales dropped 30% in Vancouver whereas in Toronto it was only 3% and it's debatable it was caused by having 1 less business day.
April does not really count to analyze sales drop. May is more valuable to see.
In May midmonth data Sales are down 16% and Listings are up 46.9%.
Average price 17.3% up year-to-year, but Toronto condos and still on fire with 28+% of price and now semidetached are on fire too in toronto with 28%+
Last edited by GalvToronto on May 19th, 2017 3:17 pm, edited 2 times in total.
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Sanyo wrote:
May 19th, 2017 3:16 pm
It will be apprised at value you sold unless it went like a million over asking. Banks approved 200-300-400 almost all the time.
Buyer is on the hook for damages, correct? Shouldn't they already know the maximum money to be extended and with the difference, having to come from their savings?

Why does the bank care if the mortgage is insured? :)
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GalvToronto wrote:
May 19th, 2017 3:17 pm
In May midmonth data Sales are down 16% and Listings are up 46.9%.
This is definitely not correct. There are 6000 sales the first 15 days, that is on par with last year. Which might I remind you was a record at the time. Not sure where you are getting the aggregate total for listings but I don't see how it could be that high.
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Mar 20, 2017
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rjg4235 wrote:
May 19th, 2017 3:24 pm
This is definitely not correct. There are 6000 sales the first 15 days, that is on par with last year. Which might I remind you was a record at the time. Not sure where you are getting the aggregate total for listings but I don't see how it could be that high.
In May 1 - May 14 total 5021 sales in GTA. Treb midmonth report that can be downloaded by any realtor. And 12626 listings.
In 2016 it were 5976 sales and 8596 listings in first half of May.
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GalvToronto wrote:
May 19th, 2017 3:26 pm
In May 1 - May 14 total 5021 sales in GTA. Treb midmonth report that can be downloaded by any realtor. And 12626 listings.
In 2016 it were 5976 sales and 8596 listings in first half of May.
I hate to burst your bubble but a lot of sales were delayed being entered, it's over 6000 for those days now that it's updated.
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Mar 20, 2017
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Well, 5 more days are gone since midmonth report date, not suprised numbers are bigger now.
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SmugDruggler wrote:
May 19th, 2017 2:09 pm
Anecdotally, and according to Garth Turner, yes. He's blogged about it several times recently (www.greaterfool.ca).
Has he sold his home yet or just selling books to the minions?
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The sky is falling down and the markets are crashing.
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john5170 wrote:
May 19th, 2017 5:44 pm
The sky is falling down and the markets are crashing.
If that were happening so many renters wouldn't be on this forum looking for hope of a crash, and isntead be searching for jobs to pay the rent.
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SmugDruggler wrote:
May 19th, 2017 2:18 pm
I think the downvoting is because Sanyo has repeatedly said that the price to income calculation for New York vs. Toronto is meaningless (New York is cheaper), and because San Francisco is also likely in a bubble.

Image
The Greater New York Area has a population of over 20 million people or over three times the size of the GTA. The median household income in NYC is roughly around $55,000 or roughly around $74k CDN, about the same as the median income in Toronto.

HOWEVER... Manhattan average price of a CONDO -- not a house a CONDO is $2.1 million USD!. I guarantee Toronto is nowhere close to that.

Also according to Trulia the median house price in NYC is $1.329 MILLION USD! Or almost $1500 a square foot USD or over $2000 CDN per square foot https://www.trulia.com/real_estate/New_York-New_York/

But hey you hate facts whatever, THAT'S FACTS... not a "oh ahhh San Francisco is likely in a bubble"... your guessing that's all. Even if SF corrects which it has a few times, it never "Crashes' and roars right back. Toronto has as well if you strip out the early 90s when rates almost doubled from 1987 to 1989. If rates double in 2 years, let's talk then huh?

But keep waiting for that 2 mil house to come down to 1.75 mil, maybe you can afford it then-- cause at the bottom prices will keep moving up as 150k+ people come every year and the immigrants who've been here for a few years want to get into the property market and your going to be priced out... get in now. People in Lower Manhattan 10-15 years ago would say the same thing, condos were affordable... but guess what...now PRICED OUT.

Then your going to be looking at Guelph in 5-10 years wishing you had bought in Toronto.
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Sanyo wrote:
May 19th, 2017 9:35 am
San Francisco median household income= $77,734
San Francisco average real estate price= $1,204,000

Toronto median household income =$72,830
Toronto average re price = 916,000

Hmmmm....
not sure where you get those numbers from:

2015

Silicon Valley median income - 102k
San Francisco - 92k

http://siliconvalleyindicators.org/data ... ld-income/

2014:

At $94,572, the region's 2013 median household income dwarfed both California's statewide $61,320 median and the nationwide $53,291 median, according to a new analysis of federal data by think tank Joint Venture Silicon Valley.Sep 24, 2014


Range of incomes from start of career to mid term 10yr:

http://www.huffingtonpost.com/entry/sil ... 0dab33ce96
Image


San Francisco prices rise and fall with the tech sector boom/bust cycles. A bit like Alberta's real estate being tied up to oil, only a lot more secure because Silicon Valley isnt a 3rd tier choice in the world for the tech market (unlike tar sands oil production).

http://www.paragon-re.com/trend/3-reces ... and-a-baby

http://www.zerohedge.com/news/2017-03-1 ... bout-burst

By comparison, Vancouver real estate is more tied to China's economic engine than to Canada's, and Toronto's is tied to its local business sector (unlike manufacturing like it was way back in the day). If you see accountants and banking types losing jobs left right and center, that's when the GTA market will start going tits up. Until then, nothing to worry about.

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