The Mysterious Vancouver Housing Bubble: Part 2
It seems to be a weekly occurrence now to hear about some new data attempting to explain the ever-rising home prices in Vancouver. This week, Benjamin Tal, deputy chief economist at CIBC, pointed to some data from Landcor Data Corp. which estimated that only 10% of foreign transactions in Vancouver over the past five years…
Read moreJune Resale Figures For The GTA
The Toronto Real Estate Board released their June resale figures today, showing a 9.5% increase in average house price and 21% increase in sales over June 2010. A particularly interesting point from the news release concerns the undersupply on the real estate market: “While sales have been strong, we would be on track for a…
Read moreA Final Thought About The Potential Housing Bubble
In discussing the recent report which led to a minor frenzy of housing bubble related media coverage, one of my main points was that it was unwise to predict countrywide drops in housing prices for a country with some pretty important differences from one region or city to another. Specifically, the data I presented showed…
Read moreMaybe Prices Aren’t Going To Drop THAT Much
Yesterday I discussed a report that suggested that the Canadian housing market was due for a big price correction. The primary piece of evidence used by the research firm Capital Economics was that the ratio of house prices to disposable income per capita was 25% above their expected levels, according to the company’s calculations. In…
Read moreResearch Firm Predicts 25% Drop in Canadian Housing Prices
A report by Capital Economics, suggests that house prices in Canada could fall by 25% over the next three years. The report points to some specific concerns for their worrying prediction: -Housing prices relative to disposable income are 25% overvalued -Unoccupied housing units are at historical highs -The homeownership rate has increased sharply over the…
Read moreUnpredictable Economy Places Premium on Expert Advice
The relative uncertainty with respect to growth and inflation rates in the short to medium term has spilled over to housing decisions. Recently, lower than expected growth and inflation rates led Bank of Canada chairman Mark Carney to put off an interest rate hike for at least six weeks. In all likelihood, a rate hike…
Read moreThe Mysterious Vancouver Housing Bubble
The fact that Vancouver is currently in the midst of a housing bubble is very much un-mysterious. House prices are up 21% over the last year and 188% over the last decade. The average house in Vancouver is 11.1 times the average annual income, double the national average. The mystery lies in what the driving…
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