Canada's 'housing bubble' deemed close to bursting

[someone123]

The "habitable" area in BC is much farther north than it is in areas farther east in Canada. Prince George looks like it would be a far-flung northern settlement at 53 N. It is remote but it has 86,000 people and the climate there is similar to southern NB. It's east of Vancouver though.

If BC weren't full of mountains it would have a huge amount of development and population. It would be like a New World version of France or Germany.

[Acajack]

Originally Posted by someone123

The "habitable" area in BC is much farther north than it is in areas farther east in Canada. Prince George looks like it would be a far-flung northern settlement at 53 N. It is remote but it has 86,000 people and the climate there is similar to southern NB. It's east of Vancouver though.
.

But then there's Edmonton!

[someone123]

Originally Posted by Acajack

But then there's Edmonton!

No comment.

[whatnext]

Originally Posted by CanSpice

Yeah but when you're talking about parts of the country that matter, he's not wrong.

My Canada includes Quebec (but only just).

[Denscity]

Yes BC is frost free on the coast all the way up to Alaska.

[whatnext]

Canadian Mortgage Credit Growth Drops to 22 Year Low Signalling the End of the Housing Boom

Canada’s mortgage credit growth continued to decelerate in Q3 2018. Per a recent report from RBC, mortgage credit growth decelerated to 3.2%, the weakest pace of growth in 22 years.

The result of banks reigning in loan growth is significant for a number of reasons. Over 90% of new money is created through banks issuing new loans, with a large portion of that growth derived through new mortgage loans. Essentially banks are shrinking the growth of new money supply, which is also called M1 and is considered the most liquid portion of the money supply because it contains currency and assets that can be quickly converted to cash...

https://vancitycondoguide.com/canadian-m...-signalling-the-end-of-the-housing-boom/

[240glt]

Originally Posted by Acajack

But then there's Edmonton!

Speaking of far flung northern settlements

[Dengler Avenue]

https://globalnews.ca/news/4806516/british-columbia-expensive-homes-property-values-2018/

[whatnext]

Originally Posted by Dengler Avenue

https://globalnews.ca/news/4806516/british-columbia-expensive-homes-property-values-2018/

Boohoo poor Chip Wilson. It’s ridiculous that place is worth over $70 million.

[Rollerstud98]

Whatnext, Bill Ferguson?

[whatnext]

Originally Posted by Rollerstud98

Whatnext, Bill Ferguson?

Who's Bill Ferguson?

Rounding out Vancouver's Top 10 assessments:

* 4707 Belmont Ave., Vancouver — $65,466,000
* 4719 Belmont Ave., Vancouver — $41,203,000
* 2815 Point Grey Rd., Vancouver — $39,961,000
* 4743 Belmont Ave., Vancouver — $37,724,000
* 4773 Belmont Ave., Vancouver — $35,880,000
* 4857 Belmont Ave., Vancouver — $35,621,000
* 3489 Osler St., Vancouver — $35,157,000
* 2999 Point Grey Rd., Vancouver— $35,012,000
* 1388 The Crescent, Vancouver — $34,788,000

https://www.vancourier.com/real-estate/v...d-condos-assessments-are-down-1.23571939

[Rollerstud98]

You are.

[whatnext]

Originally Posted by Rollerstud98

You are.

Still don't get it. Prairie humour escapes me.

[Rollerstud98]

Read the comments in the article you posted, guy named Bill Ferguson that comes off a lot like you. Curious if it was you.

[1ajs]

Originally Posted by 240glt

Speaking of far flung northern settlements

that aint far flung hahah i live in a far flung community called lynn lake mb ice roads start just north of me..

nearest cell tower is 300kms or so

[kora]

I have a feeling we're 12 to 18 months behind Australia ....

Sydney and Melbourne properties have now dropped 11.1% and 7.2% respectively compared with 2017 peak

House prices have fallen the most in a single quarter since 2008, according to new data for December.

Compared with their 2017 peak, Sydney and Melbourne’s house prices have now dropped 11.1% and 7.2% respectively, and a sharp fall in the December quarter hints that the decline is picking up pace, according to data researcher CoreLogic.

Prices dropped 4.8% in 2018 nationwide, prompting Deutsche Bank to identify a potential Australian housing crash as one of the top 30 risks to the global economy.

from the Guardian
Australian house prices falling at fastest rate in a decade
https://www.theguardian.com/australia-ne...g-at-fastest-rate-in-a-decade-data-shows

[whatnext]

Originally Posted by kora

I have a feeling we're 12 to 18 months behind Australia ....

Sydney and Melbourne properties have now dropped 11.1% and 7.2% respectively compared with 2017 peak

House prices have fallen the most in a single quarter since 2008, according to new data for December.

Compared with their 2017 peak, Sydney and Melbourne’s house prices have now dropped 11.1% and 7.2% respectively, and a sharp fall in the December quarter hints that the decline is picking up pace, according to data researcher CoreLogic.

Prices dropped 4.8% in 2018 nationwide, prompting Deutsche Bank to identify a potential Australian housing crash as one of the top 30 risks to the global economy.

from the Guardian
Australian house prices falling at fastest rate in a decade
https://www.theguardian.com/australia-ne...g-at-fastest-rate-in-a-decade-data-shows

Sounds logical vis a vis Canada, though I question DB's threat assessment. Australia isn't such a large market that it is a threat to the global economy. And Australia hasn't even entered a recession itself.

[someone123]

Originally Posted by kora

Sydney and Melbourne properties have now dropped 11.1% and 7.2% respectively compared with 2017 peak

There are two things that tend to be missing from these analyses too.

One is that there is an asymmetry when calculating percentages.

100,000 -> 200,000 is +100%
200.000 -> 100,000 is -50%

There's also compounding. So if you see a list of numbers where it's up some years and down other years it's hard to intuitively tell how prices evolved and if people experienced a return.

Also there's around 2% a year inflation in Australia.

Maybe everybody knows these things but I doubt it. It would be better to have an inflation-adjusted index starting at 100 many years ago. These indices tend to show that real estate is not nearly as great of a long-term investment as it seems and that it's prone to booms and busts.

[wave46]

Originally Posted by someone123

There are two things that tend to be missing from these analyses too.

One is that there is an asymmetry when calculating percentages.

100,000 -> 200,000 is +100%
200.000 -> 100,000 is -50%

There's also compounding. So if you see a list of numbers where it's up some years and down other years it's hard to intuitively tell how prices evolved and if people experienced a return.

Also there's around 2% a year inflation in Australia.

Maybe everybody knows these things but I doubt it. It would be better to have an inflation-adjusted index starting at 100 many years ago. These indices tend to show that real estate is not nearly as great of a long-term investment as it seems and that it's prone to booms and busts.

In general, once you figure in expenses such as property taxes, maintenance and interest over the lifetime of a house, you're lucky to come out even over a lifetime of home ownership from a financial point of view, including inflation. This excludes rental properties. However, the intangible benefits are pretty great to owning your own property IMO.

The boom in prices caused by low interest rates and foreign money (in certain areas) distorted gains upwards making housing look much more attractive than it actually is.

[someone123]

Originally Posted by wave46

In general, once you figure in expenses such as property taxes, maintenance and interest over the lifetime of a house, you're lucky to come out even over a lifetime of home ownership from a financial point of view, including inflation. This excludes rental properties. However, the intangible benefits are pretty great to owning your own property IMO.

The biggest "intangible" is not getting renovicted every so often. Then again there's also the downside that moving around is costlier and you are on the hook for a lot of problems. There is insurance but if something goes wrong you still have to deal with it on some level.

Most people who think they are property investors just own the place they live in and it would be hard for them to realize any gains unless they do something drastic like move far away.

On paper my place is worth a lot but that paper wealth does not really expand the options available to me. I'd have more options if Vancouver had a healthy and affordable market and/or better transportation.

I guess eventually if my condo goes to $2M or something I'll just move somewhere else. There won't be much left to make the city worth living in at that point anyway.

The boom in prices caused by low interest rates and foreign money (in certain areas) distorted gains upwards making housing look much more attractive than it actually is.

And you never really know when it's going to end. The market might be great now but then be in the doldrums for 10 years, like what happened in the 90's. Nobody knows.