Real Estate

TD and BMO: Toronto housing prices "simply unsustainable" and a "bubble"

  • Last Updated:
  • Mar 20th, 2017 10:09 pm
Member
Nov 1, 2010
389 posts
49 upvotes
Doubleshot wrote:
Mar 17th, 2017 5:33 pm
Well above 200k plus existing equity

Most of my friends can't afford detached homes making well over 200k USD in cities like Boston or NYC and it's normal

Same should be here
Why should conditions in another country with a different fiscal system/political and social conditions apply to this country? This is not even apples and oranges, it's fruit and vegetables.
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Sep 8, 2007
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daivey wrote:
Mar 17th, 2017 10:41 pm
that's why it's stupid.

the banks have not SLOWED down their lending at all.

Infact, if you read the CBC article, SALES Goals for their mortgage advisors, and sales advisors in the branch are now higher than ever.... and this is easily verified information... the CBC article is telling the truth, it's not a lie.

So, that leads me to believe, that the banks are full of shit. Not all their loans are CMHC back stopped. They haven't really pulled in the reigns on their lending yet....

They just printing these articles to get people off their back from the CBC article.
Yep....
I've noticed a ton of offers to increase my credit card limit from TD this year. Both by mail and when I login. And this is after an increase last year. If you turn it down it just shows up again as an offer in 3 months.

One of those "do as I say, not as I do" moments and the banks are laughing all the way to the bank (literally) with up and away stock charts.
Sr. Member
Jan 26, 2016
629 posts
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Toronto, ON
cartfan123 wrote:
Mar 18th, 2017 10:15 am
Yep....
I've noticed a ton of offers to increase my credit card limit from TD this year. Both by mail and when I login. And this is after an increase last year. If you turn it down it just shows up again as an offer in 3 months.

One of those "do as I say, not as I do" moments and the banks are laughing all the way to the bank (literally) with up and away stock charts.
I guess being intelligent in this day and age involves knowing the system well enough to take what these people say with a grain of salt and see behind the smoke mirror. They have been saying these things in the past decade over and over again to the delight of the renters, but also continuing to extend credit and mortgages left and right. They have to say these things to cover their bases, in case something happens.

Renters should get out there, look at the demand which shows what is going on in the market. If you are renting, and are in a situation that you could buy, you should buy. If it goes down 30% next year, then as long as you bought for the long run and didn't stretch yourself too much, you should get through it. But also consider that it could go up 30% next year, so risk is on both sides of the coin.

Timing the market is a fool's game.

(Speaking of fools, forget Garth; he doesn't know what he's talking about as proven over a decade. Go read his crap predictions from 2008. It's laughable.)
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Nov 13, 2010
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lol these banks are the cause of it all in the first place.........why they approve mortgages in desperation?
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Jan 14, 2009
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Vancouver, BC
123nicolas wrote:
Mar 18th, 2017 12:38 am
Why should conditions in another country with a different fiscal system/political and social conditions apply to this country? This is not even apples and oranges, it's fruit and vegetables.
Because we share economic and financial systems.
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Jan 26, 2016
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Toronto, ON
zakarydoks wrote:
Mar 18th, 2017 12:48 pm
Because we share economic and financial systems.
Right. That's why housing crumbled the same way it did in 2008/09 in US?
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WinterSleep wrote:
Mar 18th, 2017 1:03 pm
Right. That's why housing crumbled the same way it did in 2008/09 in US?
Are you saying we don't? Can you name two other countries that are as similar as Canada and the US? Canadians can buy US stocks while many Canadian companies are cross listed. This is a good thing for Canada. Many Canadians became wealthy by putting their savings in US stocks.
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Jan 26, 2016
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Toronto, ON
zakarydoks wrote:
Mar 18th, 2017 1:26 pm
Are you saying we don't? Can you name two other countries that are as similar as Canada and the US? Canadians can buy US stocks while many Canadian companies are cross listed. This is a good thing for Canada. Many Canadians became wealthy by putting their savings in US stocks.
Sure similar, but not enough to affect housing here when it crumbled there. It is still far different than you would think, even though we have ties. As well, our economy is based on natural resources, which are in the dumpsters right now.
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Jan 14, 2009
806 posts
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Vancouver, BC
WinterSleep wrote:
Mar 18th, 2017 1:37 pm
Sure similar, but not enough to affect housing here when it crumbled there. It is still far different than you would think, even though we have ties. As well, our economy is based on natural resources, which are in the dumpsters right now.
Of course we have different characteristics. Heck, all our provinces have vastly different real estate and labour markets. Alberta "crumbled" in 2015 and 2016 but BC did very well. I find Vancouver more similar to Seattle than Montreal. The US and Canada is more similar than you think and any difference is more emotional than rational. Listen, I'm not saying we are identical, but to me Canada and Mexico is far different and Canada and the US is very similar. Are we more similar or different is more of an opinion but when I make investment decisions, for example, should I buy SHOP or BOX, where their HQ is located is not a determining factor. QSR can buy and integrate TH with minimal difficulty is another example where Canada and US regulatory framework is very similar. Again, this is a good thing.
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Dec 27, 2013
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Toronto
WinterSleep wrote:
Mar 18th, 2017 1:37 pm
Sure similar, but not enough to affect housing here when it crumbled there. It is still far different than you would think, even though we have ties. As well, our economy is based on natural resources, which are in the dumpsters right now.
Also, what a lot of people fail to realize is that Canada has a much better social safety net than the USA.

People always compare us to the USA but fail to make real comparisons - e.g. qualify of life. Look at the Niagara Falls, CAD vs. USA.... or Detroit vs. Windsor. Not only are house prices astronomically different, but qualify of life is way way way way x 1000 times better on the Canadian side of the border than the USA... And on top of that, these cities are much larger which would make you think that economy of scales would make quality of life in the USA better... but it's not..

At the end of the day, or welfare, social system helps our economy WAY WAY WAY more than people think. And I'm so glad I live in Canada because of this. Housing will never crumble the same way it did in the states because our system is 180 degrees different. maybe there will be some small crashes and bumps along the way, but nothing like the USA.
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Dec 27, 2013
6020 posts
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Toronto
zakarydoks wrote:
Mar 18th, 2017 1:59 pm
Of course we have different characteristics. Heck, all our provinces have vastly different real estate and labour markets. Alberta "crumbled" in 2015 and 2016 but BC did very well. I find Vancouver more similar to Seattle than Montreal. The US and Canada is more similar than you think and any difference is more emotional than rational. Listen, I'm not saying we are identical, but to me Canada and Mexico is far different and Canada and the US is very similar. Are we more similar or different is more of an opinion but when I make investment decisions, for example, should I buy SHOP or BOX, where their HQ is located is not a determining factor. QSR can buy and integrate TH with minimal difficulty is another example where Canada and US regulatory framework is very similar. Again, this is a good thing.
Man, I think you need to go visit the states. It's not just "emotional difference". It's very very different. Right down to how people think, talk, and act. There are some exceptions, but for the most part very different culture and very different society.
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Jan 14, 2009
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Vancouver, BC
daivey wrote:
Mar 18th, 2017 6:47 pm
Man, I think you need to go visit the states. It's not just "emotional difference". It's very very different. Right down to how people think, talk, and act. There are some exceptions, but for the most part very different culture and very different society.
Vancouver is very different from Quebec City or Moncton. Right down to how people think, talk, and act. I have been to the US many times and that is my opinion. You are welcome to yours.
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Oct 7, 2010
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rkanwar109 wrote:
Mar 17th, 2017 1:50 pm
Why would they? All the risky loans are backstopped by CMHC. It's essentially a license to print money for the banks.
The government is going to stop to insure the mortgages through CMHC. If one has not 20% down payment, they have no business buying a house. Banks were giving out loans because they won't be on the hook if things go bad. The banks are starting to run scared, and will pass the additional risk to the borrowers in the form of higher interest.
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May 31, 2007
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daivey wrote:
Mar 18th, 2017 6:42 pm
Also, what a lot of people fail to realize is that Canada has a much better social safety net than the USA.

People always compare us to the USA but fail to make real comparisons - e.g. qualify of life. Look at the Niagara Falls, CAD vs. USA.... or Detroit vs. Windsor. Not only are house prices astronomically different, but qualify of life is way way way way x 1000 times better on the Canadian side of the border than the USA... And on top of that, these cities are much larger which would make you think that economy of scales would make quality of life in the USA better... but it's not..

At the end of the day, or welfare, social system helps our economy WAY WAY WAY more than people think. And I'm so glad I live in Canada because of this. Housing will never crumble the same way it did in the states because our system is 180 degrees different. maybe there will be some small crashes and bumps along the way, but nothing like the USA.
Too much socialism, social benefits and tax abuse have really hurt our productivity and economic potential. It can also provide little incentive for growth, abuse from gov on taxpayers, and rewards risk in the wrong ways.

For example, have three kids and collect thousands in child tax benefit? use the welfare and low income benefits. ( this is actually a strategy many use now)

As an entrepreneur, innovator, business owner, why take a risk or work so hard, ( and be taxed high) when you can buy a house and make the same money almost doing nothing with a system that rewards this tax free no risk so highly?

Why build a factory, oil, or global operation expansion into Canada, when the corp tax rates will be cheaper in USA once Trump cuts? + now we have carbon tax.

I don't buy the quality of life is better in Canada, if anything there is more opportunity in America then just being comfortable and the GOV providing everything for you.

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