Housing market

[thistleclub]

Putting May's REIN recommendation in perspective...


New Warning On House Prices [Tony Wong, Toronto Star, July 12, 2011]

Home values are headed for a correction and could drop by about 12 per cent within the next two years, says the Toronto-Dominion Bank in an economic note Monday....

The Toronto market alone saw starts rise by 23 per cent, fuelled by growth in the single detached and highrise sectors. Highrise starts are now 57 per cent higher in the first six months of 2011 compared with last year. With major sales in the pipeline, CMHC says highrise construction will be strong for the remainder of the year.

“Apartment construction will remain brisk but slower job growth, more balanced resale markets and tighter mortgage markets should temper the pace of construction activity in the months ahead,” said CMHC regional economist Ted Tsiakopoulos.

[thistleclub]

A wild card in the local housing market.

Housing Market Hot Streak Coming To An End [Tony Wong, Toronto Star, July 16 2011]

The 15-year gravity-defying run of house prices in Toronto is at an end, according to a Star survey of leading economists and Canada’s five major banks. Analysts agree the cycle of exceptional appreciation will be broken in 2012, but disagree about the severity of the downturn – some believe house prices will flatline, others forecast a drop of up to 25 per cent by 2013. If that forecast comes true, it will put an end to a spectacular run-up that saw prices more than double in cities such as Toronto since 1996. The predications come even as national house prices hit a new record average of $372,800 in June, up 8.7 per cent from the same month last year, according to figures released by the Canadian Real Estate Association Friday. Sales were also up by 10.8 per cent compared to a year earlier....

Prices are still expected to rise by as much as 6 per cent in 2011 over 2010, as the market remains healthy. But heavier consumer debt, an inevitable rise in interest rates, and an uncertain global economic outlook will weigh on prices next year, say economists. A situation in which prices flatline is for some analysts the best-case scenario. Other bank economists and non-bank analysts have said prices will drop by anywhere from 10 per cent to 25 per cent over the next two years....

The most likely outcome for the Canadian market is “not an abrupt downward correction, but rather a period of relatively flat sales and pricing that eventually restores a better affordability balance,” said Scotiabank economist Adrienne Warren in a report Friday.

[thistleclub]

Another article heavy on the "what's not to love about zany real estate bargains" angle, complete with requisite use of the word "burgeoning":

Why This Cool Kid Moved to Hamilton [Mark Skulnick, Huffington Post Canada, Aug 9 2011]

[thistleclub]

CMHC Reports Housing Starts Declined

TORONTO, ONTARIO--(Marketwire - Aug. 9, 2011) - Preliminary data released today by CMHC for the Hamilton Census Metropolitan Area (CMA) show total housing starts declined in July – typically an active month for residential construction. Fewer single-detached homes started in the City of Hamilton and Grismby led to the decrease in total starts last month as compared to 2010. Similar trends prevailed for the first half of the year, where single-detached starts matched last year's pace in Burlington, but decreased by about one-third in the City of Hamilton and Grimsby. While there were no other home starts in Grimsby, townhouse construction rose last month in the City of Hamilton and Burlington. There were also two new low-rise rental apartment buildings started in the City of Hamilton last month.

Total starts have been relatively flat the last few months. Slower home starts across all parts of the CMA and housing types this year indicate that some buyers remain hesitant when considering a new home purchase. Many potential buyers have also been drawn to the resale market, where listings of resale homes have been at record high levels.

"Single-detached starts in the City of Hamilton and Grimsby led the decline in starts last month" said Sarah Fong, CMHC's Senior Market Analyst for Hamilton. "Competition from a high number of new listings in the resale market has led to lower demand for new homes." added Fong.

As Canada's national housing agency, CMHC draws on 65 years of experience to help Canadians access a variety of high quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making informed decisions.

To view the "Total Starts Decreased in July" graph, please visit the following link: http://media3.marketwire.com/docs/hjulste.pdf

To view the "Housing Starts July 2011, Hamilton CMA" table, please visit the following link: http://media3.marketwire.com/docs/hjulstech.pdf

[Skully2001]

Originally Posted by thistleclub

Another article heavy on the "what's not to love about zany real estate bargains" angle, complete with requisite use of the word "burgeoning":

Why This Cool Kid Moved to Hamilton [Mark Skulnick, Huffington Post Canada, Aug 9 2011]

Actually, that wasn't the point of my article, at all...sure, I mentioned the "zany real estate bargains", but over all, the post dealt (with tongue firmly-in-cheek, I might add) the misconceptions of others regarding Hamilton and the reaction I got when I told my fellow Torontonians that I was moving here...

[thistleclub]

Subjective takeaway. Second half of the article seems largely concerned with real estate values, which is why I said "heavy on the". Cheap real estate is a rote storyline when it comes to Hamilton's out-of-town press (eg: National Post, Aug 2006, Toronto Star, Jan 2008), so it's refreshing to hear that I was mistaken.

[hammerton]

There seems to be a lot of price reductions in the 5-10% range in Hamilton lately.

[Berklon]

Originally Posted by hammerton

There seems to be a lot of price reductions in the 5-10% range in Hamilton lately.

I've noticed the same thing... as well as a lot more listings (red dots galore on the MLS site) and many homes just sitting unsold for a long period of time.

[bigguy1231]

Originally Posted by hammerton

There seems to be a lot of price reductions in the 5-10% range in Hamilton lately.

It's called wishful thinking on the part of real estate agents and owners when they initially list the property's.

[CaptainKirk]

Hamilton on the rise

CRE takes a survey of the growing rental market in Canada's steel town

It was once a blue-collar industrial town where 60% of Canada's steel was produced. But when one of its main steel producers almost went bankrupt and the city was hit by the recession, many Canadians wrote it off as a ghost town in training.

However, today, Hamilton is proving those nay-sayers wrong. It is breaking through its past, and, in fact, is poised to outperform most of the province as it sheds its past reputation and grabs a hold of the future. A prime choice for future economic opportunity with an educated workforce, stunning natural amenities and a diverse, resilient economy, Hamilton was ranked one of the top five places to invest in Canada by U.S.-based Selection Magazine

In just a few short years, the continuing diversification of the city's economy will result in an economy unrecognizable when compared to the past decades. This renewal will drive demand for real estate (rentals as well as ownership) in the city, especially in older neighbourhoods going through transition.

Read more here http://www.canadianrealestatemagazin...on-on-the-rise

[SteelTown]

We seriously need luxury rentals in Hamilton. There's virtually zero in Hamilton, only one I'm aware of is Chateau Royale.

[LikeHamilton]

Apartments not easy to come by

Shiona Thompson 900 CHML 12/13/2011

It's a little tougher to find an apartment in Hamilton.
According to figures released from Canada Mortgage and Housing Corporation, Hamilton's rental vacancy rate is down to 3.4 per cent from last year.
That is a decrease of point three per cent.
C-M-H-C says some people are putting off buying a house this year and are opting to keep paying rent for a while longer.
Canada's national housing agency says the trend is more pronounced in Brantford where the vacancy rate is down to 1.8 per cent a drop of about two full points.

[Vod_Kann]

Interesting- People keep bugging me buy a house so I don't "throw my money away renting". Yet I don't pay taxes, heat, hydro or water- so am I really throwing my money away?

looks like more people are thnking the same

[durandy]

houses are only a good investment if you rent out a room in them. House with basement apartment is fantastic investment. Avoids most of the problems with being a landlord, allows tax deductions, pretty easy to get junk tenants out as well.

[Jon Dalton]

I tend to agree. I bought a house and rent out (to great people) to help cover costs. However there is no way I could afford bills, taxes and upkeep if I were going it alone. Plus what happens when interest rates rise and mortgages are no longer cheap. Houses are great if you can make the system work to your advantage, but there is always wisdom in keeping your costs fixed.

[markbarbera]

Originally Posted by Vod_Kann

Interesting- People keep bugging me buy a house so I don't "throw my money away renting". Yet I don't pay taxes, heat, hydro or water- so am I really throwing my money away?

looks like more people are thnking the same

You may not be paying taxes or utilities directly, but all that is factored into your monthly rent.

Renting vs ownership is more about what most suits your lifestyle, so do whatever suits your needs. If you don't want to worry about home maintenance or want to be flexible in relocating residences, renting is probably a good option. If you are someone who stays put, ownership means your monthly housing costs are an investment that will eventually return a gain when the day comes to sell, rather than an irrecoverable expense when housing costs are in the form of rent.

[flar]

It's better to buy if you plan to stay put, the price is right and there's a good chance the property will hold its value. It's definitely smart to be rent and mortgage free when you retire. Or to sell your house, use the money to buy something smaller and add the profit to your savings. Those are pretty common strategies.


I would probably buy in certain areas of Hamilton. In Ottawa, I rent and have no immediate plans to buy. The problem in Ottawa is that a mortgage payment is roughly double the rent for an equivalent dwelling, which suggests that houses are overvalued at the moment.

[Duckyboy]

Originally Posted by Vod_Kann

Interesting- People keep bugging me buy a house so I don't "throw my money away renting". Yet I don't pay taxes, heat, hydro or water- so am I really throwing my money away?

looks like more people are thinking the same

The thing most forget is this: you have no asset when renting. When you own a house, you have the ability to sell and cash in... there is no option with renting.

I'm not saying what you should and shouldn't do, but it sure is nice to be sitting on (potentially) hundreds of thousands of dollars, instead of making someone else rich.

And yes, the bank get's rich off of you, but at least you get a house out of it; you don't get shit from renting.

Everyone has different needs, and renting suites many, and ownership suites others.

[Duckyboy]

Originally Posted by durandy

houses are only a good investment if you rent out a room in them. House with basement apartment is fantastic investment. Avoids most of the problems with being a landlord, allows tax deductions, pretty easy to get junk tenants out as well.

You still have to be landlord with a basement suite... just a little less travel time: you still have to collect rent, perform repairs and make sure the unit is occupied. There are also (obviously) tax deductions involved with investments properties... otherwise NOBODY would be a landlord.

Also, how is it any easier evicting a crappy tenant from your basement as opposed to your investment property?

Unless I'm missing something, they seem to be quite similar (I've had and have both right now).

[flar]

Originally Posted by Duckyboy

And yes, the bank get's rich off of you, but at least you get a house out of it; you don't get shit from renting.

That's not true at all. If the differential between monthly mortgage payments and monthly rent is great enough you could get far better returns in the long run by investing the difference in something else. The value of your home might drop or stagnate too, real estate isn't as safe an investment as some people think.

There are all kinds of rent vs. buy calculators on the Internet.