According to a Yale professor, Vikram Mansharamani, the Canadian housing market is "loonie tunes". He points to high levels of consumer debt in Canada, sinking commodity prices, reliance on foreign buyers such as the Chinese, and the divergence of the US and Canadian housing markets.
While I agree with his analysis, he is making the same points as many others have made over the past 5 years, yet the housing market in Vancouver and Toronto goes up and up, with no dips. Now that mortgage rates are even lower in Canada, will the market finally rationalize, or will folks keep buying property?
Our experience indicates that the market will continue its dance with the devil. In the past 3 years, we have tried to buy in Toronto, but are ultimately stymied by high prices and the crazy nature of the market. Houses sell in bidding wars set up by real estate agents, who have become auctioneers. Condos sell within a few days if they are priced "reasonably" - reasonable in Toronto meaning anything that is not judged absolutely crazy. We saw one condo listed on Wednesday this week at $850K Cdn, we asked our realtor to go and see it, he got an appointment for Thursday, but it was then cancelled because it was sold, that means two days on the market!
As a comparison, I looked up condos in the Washington DC area. The same square footage in a similar area, with more amenities, sells for about $800K US, with lower maintenance fees. So it looks like the Toronto condo market costs about the same as Washington DC. You can argue about currency differences, but it is still pretty similar.
In any case, props to Professor Mansharamani, but I would recommend he stay at Yale, as properties are more reasonable in New Haven Connecticut.
While I agree with his analysis, he is making the same points as many others have made over the past 5 years, yet the housing market in Vancouver and Toronto goes up and up, with no dips. Now that mortgage rates are even lower in Canada, will the market finally rationalize, or will folks keep buying property?
Our experience indicates that the market will continue its dance with the devil. In the past 3 years, we have tried to buy in Toronto, but are ultimately stymied by high prices and the crazy nature of the market. Houses sell in bidding wars set up by real estate agents, who have become auctioneers. Condos sell within a few days if they are priced "reasonably" - reasonable in Toronto meaning anything that is not judged absolutely crazy. We saw one condo listed on Wednesday this week at $850K Cdn, we asked our realtor to go and see it, he got an appointment for Thursday, but it was then cancelled because it was sold, that means two days on the market!
As a comparison, I looked up condos in the Washington DC area. The same square footage in a similar area, with more amenities, sells for about $800K US, with lower maintenance fees. So it looks like the Toronto condo market costs about the same as Washington DC. You can argue about currency differences, but it is still pretty similar.
In any case, props to Professor Mansharamani, but I would recommend he stay at Yale, as properties are more reasonable in New Haven Connecticut.
Are Ivy League universities allowed to mention Bugs Bunny? In Toronto you can get a $300K condo which is 240 sq feet, smaller than a "studio" apartment ( sounds like a joke by Yakov Smirnoff)
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