Canada's 'housing bubble' deemed close to bursting

[O-tacular]

More on NOEM here:

https://www.vice.com/en/article/wxn7gb/n...ert-megacity-the-line-under-construction

It's very buzzwordy, filled with AI powered everything.

Apparently this isn't even the first time this concept was attempted. Madrid has a suburb that was built as a linear city just like this and failed in 1882:

https://www.vice.com/en/article/m7a598/s...inear-city-concept-in-bigger-dumber-form

[O-tacular]

Originally Posted by swimmer_spe

The Mars Colony wasn't bad, if you had the money.

And dee AYR!!!

[O-tacular]

Originally Posted by Mister F

I'm getting some serious Deux Ex Golem City vibes from that thing. Which was inspired by the Kowloon walled city.


https://steamcommunity.com/sharedfiles/filedetails/?id=1657959155

Totally! But don't worry it will be shinier and newer.

[Wigs]

Originally Posted by SignalHillHiker

5 mins downhill, 15 back up.

[swimmer_spe]

Originally Posted by JHikka

What locals? The migrant workers they'll import from India?

I meant all the non millionaires that still need a job to get money.

[MolsonExport]

Originally Posted by O-tacular

And dee AYR!!!

Why are you showing a photo of the reaction of that Air Canada passenger that couldn't get served a Seven-Up in French?

[ssiguy]

Well it looks like Ford is taking on the Mayors with his new housing policy and good for him. Ontario has now effectively gotten rid of all SFH planning as duplexes and triples can now be built on any housing site by over riding municipal zoning. He is also getting rid of some of the ridiculous environmental reviews, planning and community reviews even on developments that fit within the zoning laws, and never ending city charges which add tens of thousands to the cheapest of homes. Ford knows {like every urban planner} that much of the impediment of building housing in Canada has nothing to do with Ottawa or the provinces and everything to do with municipalities and how they at the political whim of our corrupt local politicians and the developers who bribe them.

Vancouver has the most strictive housing policy in the country with over 80% of residential land zoned exclusively for SFH. This is a good part of why Vancouver has such a housing affordability & availability crisis and why you get this very odd urban landscape of KMs of SFH with tiny little pockets of skyscrapers sticking out like a sore thumb.

If Victoria is TRULY serious about bringing some form of sanity back to the housing sector then it will follow Queen's Park's move.

[Wigs]

But I thought Ford was in the pocket of developers himself, as in the major GTA home builders and developers donated large sums to his campaign?

At any rate I'm glad to hear that. Southern Ontario could use a lot more 2-3 unit buildings as opposed to so many SFH. Not everyone desires a large yard to maintain but don't want to live in a condo. Duplexes-Tri plexes are a good solution (as is small apartments <20 units)

[whatnext]

Originally Posted by Wigs

But I thought Ford was in the pocket of developers himself, as in the major GTA home builders and developers donated large sums to his campaign?)...

Don't developers build multifamily? It's still a payoff for them.

[SignalHillHiker]

Jealous of that deck.

[Coldrsx]

Originally Posted by ssiguy

Well it looks like Ford is taking on the Mayors with his new housing policy and good for him. Ontario has now effectively gotten rid of all SFH planning as duplexes and triples can now be built on any housing site by over riding municipal zoning. He is also getting rid of some of the ridiculous environmental reviews, planning and community reviews even on developments that fit within the zoning laws, and never ending city charges which add tens of thousands to the cheapest of homes. Ford knows {like every urban planner} that much of the impediment of building housing in Canada has nothing to do with Ottawa or the provinces and everything to do with municipalities and how they at the political whim of our corrupt local politicians and the developers who bribe them.

Vancouver has the most strictive housing policy in the country with over 80% of residential land zoned exclusively for SFH. This is a good part of why Vancouver has such a housing affordability & availability crisis and why you get this very odd urban landscape of KMs of SFH with tiny little pockets of skyscrapers sticking out like a sore thumb.

If Victoria is TRULY serious about bringing some form of sanity back to the housing sector then it will follow Queen's Park's move.

Certainly the most aggressive approach in Canada and with much of it I agree, but I do wonder about unintended consequences, lack of construction labour and material shortages.

You can rezone or revise regulations, policy and statutory requirements all you like to open things up, but the current reality is that we need more workers if anything is going to really change.

Skilled labour and new training is coming, but not fast enough.

[MonkeyRonin]

Originally Posted by ssiguy

Well it looks like Ford is taking on the Mayors with his new housing policy and good for him. Ontario has now effectively gotten rid of all SFH planning as duplexes and triples can now be built on any housing site by over riding municipal zoning. He is also getting rid of some of the ridiculous environmental reviews, planning and community reviews even on developments that fit within the zoning laws, and never ending city charges which add tens of thousands to the cheapest of homes. Ford knows {like every urban planner} that much of the impediment of building housing in Canada has nothing to do with Ottawa or the provinces and everything to do with municipalities and how they at the political whim of our corrupt local politicians and the developers who bribe them.

Vancouver has the most strictive housing policy in the country with over 80% of residential land zoned exclusively for SFH. This is a good part of why Vancouver has such a housing affordability & availability crisis and why you get this very odd urban landscape of KMs of SFH with tiny little pockets of skyscrapers sticking out like a sore thumb.

Technically Vancouver allows up to 3 units across the city: 2 units in the main structure + a laneway house. That's still not enough, of course - it should be at least 5 or 6 units with fewer form restrictions - but it's also not the strictest in the country.

Toronto was the same as well: minimum 2 units + laneway/garden suite in all areas. Ford's move is very welcome, but really only adds the possibility of an extra 1 unit per lot. It's great that it's province-wide though, and cutting fees & approval times will at least make it easier to get more small-scale multi-family built.

[Wigs]

Originally Posted by Coldrsx

Certainly the most aggressive approach in Canada and with much of it I agree, but I do wonder about unintended consequences, lack of construction labour and material shortages.

You can rezone or revise regulations, policy and statutory requirements all you like to open things up, but the current reality is that we need more workers if anything is going to really change.

Skilled labour and new training is coming, but not fast enough.

This is a great point.

When my brother lived in LA county, in the San Gabriel Valley they had a construction trades training academy with real life looking "jobsites" to practice various trade skills/jobs on. I thought that would be a great idea to implement in Canada.

[whatnext]

Batten down the hatches.

David Rosenberg: Canada's housing bubble has burst — now brace yourself for the economic hit
The upcoming recession could be deeper than what Bay Street folks are expecting
Author of the article: David Rosenberg
Publishing date: Oct 28, 2022

Canada’s housing bubble has burst. The MLS house price index is now down nine per cent from last February’s peak en route to a 30 per cent or so decline, which we view as consistent with deteriorating affordability and the uber-aggressive tightening of monetary policy by the Bank of Canada.

We estimate the negative wealth effect associated with such a price slump will pull down gross domestic (GDP) growth by about 2.5 percentage points. Add to this the deleveraging effect of higher interest rates on consumption and investment, and the hit to trade from the expected downturn in the United States and global economy, and it’s not difficult to see why Canada’s upcoming recession could be deeper than what Bay Street folks are expecting...

....Households are being hit with a confluence of factors heading into this recession: rapid restrictions on credit access, higher debt-servicing costs on near-record-high household debt levels and inflation limiting disposable income. This is all being compounded by wealth depletion in both equity and residential markets, which also weigh on sentiment.

The last time all these factors were at play was the early 1990s, when Canada entered a Bank of Canada-induced recession and residential property prices fell by almost 30 per cent from their peak between 1989-1996....

https://financialpost.com/news/economy/home-price-plunge-recession-david-rosenberg

[swimmer_spe]

Originally Posted by whatnext

Batten down the hatches.

David Rosenberg: Canada's housing bubble has burst — now brace yourself for the economic hit
The upcoming recession could be deeper than what Bay Street folks are expecting
Author of the article: David Rosenberg
Publishing date: Oct 28, 2022

Canada’s housing bubble has burst. The MLS house price index is now down nine per cent from last February’s peak en route to a 30 per cent or so decline, which we view as consistent with deteriorating affordability and the uber-aggressive tightening of monetary policy by the Bank of Canada.

We estimate the negative wealth effect associated with such a price slump will pull down gross domestic (GDP) growth by about 2.5 percentage points. Add to this the deleveraging effect of higher interest rates on consumption and investment, and the hit to trade from the expected downturn in the United States and global economy, and it’s not difficult to see why Canada’s upcoming recession could be deeper than what Bay Street folks are expecting...

....Households are being hit with a confluence of factors heading into this recession: rapid restrictions on credit access, higher debt-servicing costs on near-record-high household debt levels and inflation limiting disposable income. This is all being compounded by wealth depletion in both equity and residential markets, which also weigh on sentiment.

The last time all these factors were at play was the early 1990s, when Canada entered a Bank of Canada-induced recession and residential property prices fell by almost 30 per cent from their peak between 1989-1996....

https://financialpost.com/news/economy/home-price-plunge-recession-david-rosenberg

I see these things and think about the ones this will hurt.
It won't hurt retirees who have paid off their house and plant to say till they die.
It won't hurt someone who does not plan to move.
It won't hurt people looking for their first home.

However:
It will hurt flippers
It will hurt people who tend to upgrade when their mortgage comes up for renewal.
It will hurt those that want to upgrade.
It will hurt those that have to relocate.

[MonkeyRonin]

Funny things happening in Toronto's real estate market: only 289 condo units and 45 houses sold in September 2022 - down 89% and 96% respectively from September 2021. Yet average prices are up 11.8% for condos (now sitting at a very reasonable $1,159,455) and 17.8% for houses.

https://www.blogto.com/real-estate-toronto/2022/10/toronto-home-sales-are-tanking-experts-worried/

[swimmer_spe]

Originally Posted by MonkeyRonin

Funny things happening in Toronto's real estate market: only 289 condo units and 45 houses sold in September 2022 - down 89% and 96% respectively from September 2021. Yet average prices are up 11.8% for condos (now sitting at a very reasonable $1,159,455) and 17.8% for houses.

https://www.blogto.com/real-estate-toronto/2022/10/toronto-home-sales-are-tanking-experts-worried/

They are worried because there isn't much stock. That is why the price is high. We need the 1950s post war housing boom.

[whatnext]

Originally Posted by MonkeyRonin

Funny things happening in Toronto's real estate market: only 289 condo units and 45 houses sold in September 2022 - down 89% and 96% respectively from September 2021. Yet average prices are up 11.8% for condos (now sitting at a very reasonable $1,159,455) and 17.8% for houses.

https://www.blogto.com/real-estate-toronto/2022/10/toronto-home-sales-are-tanking-experts-worried/

Partly due to factors swimmer mentions above. People can’t afford to move up and therefore aren’t vacating their existing homes.

[MonkeyRonin]

Originally Posted by swimmer_spe

They are worried because there isn't much stock. That is why the price is high. We need the 1950s post war housing boom.

"Housing inventory remained low in September, though the available stock of new homes actually increased slightly to 11,900 units. This new inventory largely takes the form of condos, with 10,291 condominium apartment units and just 1,609 single-family lots on the market last month."


Housing stock may be lower than what's theoretically needed; but if only 3% of available units are being sold in a given month, then that speaks to a lack of demand. Sales have dropped off a lot faster than listings. This supports two hypotheses as to what currently might be happening:

1. Only the high-end of the market is still healthy - lower-end buyers have otherwise been priced out as result of rate hikes & inflation (most instead opting to rent, hence why rental costs are soaring right now), so the average sale price is weighted more heavily towards higher-end properties. And/or,

2. Prospective buyers are sitting on the sidelines waiting for prices to drop; while sellers are stubbornly trying to keep prices high. Thus, only the most desperate or gullible are actually biting at this time. But sooner or later, sellers are going to have to start dropping prices.

[swimmer_spe]

Originally Posted by MonkeyRonin

"Housing inventory remained low in September, though the available stock of new homes actually increased slightly to 11,900 units. This new inventory largely takes the form of condos, with 10,291 condominium apartment units and just 1,609 single-family lots on the market last month."


Housing stock may be lower than what's theoretically needed; but if only 3% of available units are being sold in a given month, then that speaks to a lack of demand. Sales have dropped off a lot faster than listings. This supports two hypotheses as to what currently might be happening:

1. Only the high-end of the market is still healthy - lower-end buyers have otherwise been priced out as result of rate hikes & inflation (most instead opting to rent, hence why rental costs are soaring right now), so the average sale price reflects higher-end properties. And/or,

2. Prospective buyers are sitting on the sidelines waiting for prices to drop; while sellers are stubbornly trying to keep prices high. Thus, only the most desperate or gullible are actually biting at this time. But sooner or later, sellers are going to have to start dropping prices.

1) That shows that there still is a lack of affordable housing for most residents. I cannot understand how a house that is not more than 20 rooms can cost a million dollars.

2) That is what is needed. Desperation from sellers is the only way to correct this market.