Locked: Full-scale attack on Canadian home prices': BMO economist

First it was flippers, then foreign buyers, then investors leveraging their HELOC. When are they going to run out of scapegoats?

Government definitely going to miss the apparent signs of an already occurring slowdown, and accidentally tank the market too much.

Anyone who jumped in last couple years will see their property values drop back at least to pre-COVID level within the next 2-5 years.

It's unfortunate but it will be good for the society. At least, many realtors will have to get a real job and doing something productive soon.

freemoney118 wrote: ↑ Anyone who jumped in last couple years will see their property values drop back at least to pre-COVID level within the next 2-5 years.

It's unfortunate but it will be good for the society. At least, many realtors will have to get a real job and doing something productive soon.

At least eh? So Oakville, Markham, rh, now over 2m for detached, will lose between 500k and 600k? You really think that?

freemoney118 wrote: ↑ Anyone who jumped in last couple years will see their property values drop back at least to pre-COVID level within the next 2-5 years.

It's unfortunate but it will be good for the society. At least, many realtors will have to get a real job and doing something productive soon.

What do you do for work?

GTA12345 wrote: ↑ At least eh? So Oakville, Markham, rh, now over 2m for detached, will lose between 500k and 600k? You really think that?

Well - if it could go up that much in 2 years, why it can't give back those gain when everything is working against it now. The low rate and Downtown exodus caused many area to go up 50% or more in last couple years.

All those positive factors are gone, and now governments from all levels will start to hit the market AFTER the facts. They almost always mess up things.

Markham, RH will do relatively fine. I suspect Condos in core areas will do even better. Those condos in suburbs, houses in far away places will get hit the hardest, as they have gained the most last couple years.

Again, it's not a bad thing to have a correction like this once in a while. Get used to it.

GTA12345 wrote: ↑ At least eh? So Oakville, Markham, rh, now over 2m for detached, will lose between 500k and 600k? You really think that?

Why not? If it went up that much in the same time frame why couldn't the reverse happen? Reverse FOMO can be pretty wild...

freemoney118 wrote: ↑ Markham, RH will do relatively fine. I suspect Condos in core areas will do even better. Those condos in suburbs, houses in far away places will get hit the hardest, as they have gained the most last couple years.

My thinking is downtown condos will do the worst. They are mostly owned by investors who will be the first to run for the exit if prices start heading south quickly. Many are already leveraged to the max at the same time we are coming into a period of rising interest rates.

crucial1 wrote: ↑ Why not? If it went up that much in the same time frame why couldn't the reverse happen? Reverse FOMO can be pretty wild...

Yup. It is hilarious that people think it just "can't" go down that much after it went up even more then that in only 18-20 months.

GTA12345 wrote: ↑ At least eh? So Oakville, Markham, rh, now over 2m for detached, will lose between 500k and 600k? You really think that?

He's engaging in hyperbole. But I think a more legit question is - whats a plausibe % they could drop? 10/15%? That would be 2-300 K. Not excatly 5/600 but not chump change either. And what then becomes the forward looking return on the houses? 2/3% per year? Back to pre 2015 normal rate of increase?

DaveTheDude wrote: ↑ My thinking is downtown condos will do the worst. They are mostly owned by investors who will be the first to run for the exit if prices start heading south quickly. Many are already leveraged to the max at the same time we are coming into a period of rising interest rates.

Where else will GTA investors who sell will park their money? In Toronto.

Downtown Toronto is safe haven in any regards.

freemoney118 wrote: ↑ Well - if it could go up that much in 2 years, why it can't give back those gain when everything is working against it now. The low rate and Downtown exodus caused many area to go up 50% or more in last couple years.

All those positive factors are gone, and now governments from all levels will start to hit the market AFTER the facts. They almost always mess up things.

Markham, RH will do relatively fine. I suspect Condos in core areas will do even better. Those condos in suburbs, houses in far away places will get hit the hardest, as they have gained the most last couple years.

Again, it's not a bad thing to have a correction like this once in a while. Get used to it.

crucial1 wrote: ↑ Why not? If it went up that much in the same time frame why couldn't the reverse happen? Reverse FOMO can be pretty wild...

BatCountry wrote: ↑ Yup. It is hilarious that people think it just "can't" go down that much after it went up even more then that in only 18-20 months.

Fair enough, I don't agree but I'm not saying it's impossible.

However, things like this, trend lines over time tend to go up. Like stocks. So, the corrections generally don't equal the gains, otherwise the trend would be flat. Heck, inflation, wages alone would indicate the gains will outdo the drops more often than not over a long time series.

This could be different. I'll acknowledge that, but I wouldn't bet on that level of correction myself

Hp4041 wrote: ↑ He's engaging in hyperbole. But I think a more legit question is - whats a plausibe % they could drop? 10/15%? That would be 2-300 K. Not excatly 5/600 but not chump change either. And what then becomes the forward looking return on the houses? 2/3% per year? Back to pre 2015 normal rate of increase?

I really don't know. But it is funny to see people so self assured it also won't just stay within 10% of where it is now.

Point is we really don't know. But the only angry ones lashing out, posting thread after thread, seem to be the ones who think were heading for a cliff. The rest of us are Meh, maybe.

If I had to peg a number, I could see a 15% drop in detached in the inner 905. Over 20% ya I'd be surprised. So I guess in a few months this post might come back to haunt me!

1xTiMeR wrote: ↑ Where else will GTA investors who sell will park their money? In Toronto.

Downtown Toronto is safe haven in any regards.

Not so much where they will park their money but how do investors they cut their losses. Maybe this time will be different but during the last major crash downtown condos fell 10% more then the rest of the GTA.

DaveTheDude wrote: ↑ My thinking is downtown condos will do the worst. They are mostly owned by investors who will be the first to run for the exit if prices start heading south quickly. Many are already leveraged to the max at the same time we are coming into a period of rising interest rates.

Prices are already up 30% since you made that prediction last year lol

Lots of bears coming out in this thread lol…ultimately house prices will go up or down as much as what buyers are willing to pay for it…and what sellers are willing to accept…the highs have just been set this Jan and Feb…

moofur wrote: ↑ First it was flippers, then foreign buyers, then investors leveraging their HELOC. When are they going to run out of scapegoats?

All of these things contributed to rising prices at one point or another in the past 20 years, in the GTA. As well as a number of other things. The question is, what did the three levels of gov. do about it? Nothing. What are they going to do now? Nothing. Based on my reading of this article, all Doug Ford is trying to do here is give his developer buddies even more power. I am sorry to say developers are not your friends. Especially in the GTA, where the biggest developers monopolize the market and hoard most of the undeveloped land(Then cry there is no land left, so you can sell them all the prime greenbelt land). Prices don't drop when there are monopolies.

freemoney118 wrote: ↑ Well - if it could go up that much in 2 years, why it can't give back those gain when everything is working against it now. The low rate and Downtown exodus caused many area to go up 50% or more in last couple years.

All those positive factors are gone, and now governments from all levels will start to hit the market AFTER the facts. They almost always mess up things.

Markham, RH will do relatively fine. I suspect Condos in core areas will do even better. Those condos in suburbs, houses in far away places will get hit the hardest, as they have gained the most last couple years.

Again, it's not a bad thing to have a correction like this once in a while. Get used to it.

crucial1 wrote: ↑ Why not? If it went up that much in the same time frame why couldn't the reverse happen? Reverse FOMO can be pretty wild...

BatCountry wrote: ↑ Yup. It is hilarious that people think it just "can't" go down that much after it went up even more then that in only 18-20 months.

Quoting these again, let's see if anyone wants to put some numbers to this. I said in a post here that detached inner 905 I could see 15% drop. Over 20% would surprise me.

Here is where we are in 3 areas for detached, raw avg last 3 months, TREBB numbers

Markham - $2.05m
Oakville - $2.34m
RH - $2.10

Here is where they were 1st quarter 2020, so right before Covid, 3 months avg

Markham - $1.35m
Oakville - $1.45m
RH - $1.43

So for these three users I've quoted, would you be willing to predict these 3 areas drop about $700k, 900K, and 700K respectively?

That's what's required for a return to pre covid levels. That's what it has to come down, after all it went up that much right?

Why can't the reverse happen right?

Riiiiiiiiight?

Anyone really sticking to that magnitude of a drop?

Or any other users here wanna predict?

Will be fun in summer to see who is eating words, ya maybe me, but I can take it

Land restriction (aka greenbelt) is the biggest reason for the soaring prices. Unless government addresses the issue the house prices will continue to go up.

Within 30 minutes of drive from city center you see large vacant land. It only happens in HK and Shanghai when government owns the land.