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Baby, we got a bubble!?

Bruno Republic said:
But after years of hearing claims that the market was going to crumble within a matter of weeks, I've become very skeptical of anyone who claims to know what will happen.
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I agree with this sentiment 100%. It's one thing to be cautious in light of market fundamentals but another to preach doom and gloom with such certainty when even the leading economists and analysts in the country are unsure what will happen.

I feel a lot of doomsayers are trying to justify their indecision or are people who are priced out of the market and are hoping for a crash.
 
the economists aren't wrong in their analysis, but they are incorrect about their timing due to Bank of Canada manipulation of interest rates.

not sure if either you are aware that prices and interest rates are inversely proportionate.
even the 'expert real estate' floggers have acknowledged that the markets are being buoyed by low rates, thus allowing products to be still 'affordable'.

at any price, a very minor 100 basis points (1.00%) increase in interest rates will increase monthly mortgage payments by 8-10% based on 5-year term / 25-year amortization.

the only way to keep the same property 'affordable' is a proportionate decrease in price.

Bruno Republic said:
Who said that? All I said was that I've been hearing claims that a market collapse was imminent since I bought in 2004. Yet despite all the countless citations of market statistics, historical averages, global economic factors, etc., it still hasn't happened.

I never said it wouldn't or couldn't happen. But after years of hearing claims that the market was going to crumble within a matter of weeks, I've become very skeptical of anyone who claims to know what will happen.
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TO_Guy said:
I agree with this sentiment 100%. It's one thing to be cautious in light of market fundamentals but another to preach doom and gloom with such certainty when even the leading economists and analysts in the country are unsure what will happen.

I feel a lot of doomsayers are trying to justify their indecision or are people who are priced out of the market and are hoping for a crash.
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No one is arguing that rising interest rates won't have a dampening effect on demand but to speak of an imminent crash with any certainty is foolhardy.
 
Bruno Republic said:
Who said that? All I said was that I've been hearing claims that a market collapse was imminent since I bought in 2004. Yet despite all the countless citations of market statistics, historical averages, global economic factors, etc., it still hasn't happened.
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Hasn't happened? What would you call the period from Q3 2008 to Q1 2009?

http://pacificapartners.com/blog/wp...03/Wealth-Management-Surrey-Fraser-Valley.png

If the Canadian government did not orchestrate a fantastical backdoor bailout of the mortgage market (without any parliamentary debate) back in 2009 the housing market would have been toast.

Seems memories are selective here.
 
Last edited:
cdr108 said:
the economists aren't wrong in their analysis, but they are incorrect about their timing due to Bank of Canada manipulation of interest rates.

not sure if either you are aware that prices and interest rates are inversely proportionate.
even the 'expert real estate' floggers have acknowledged that the markets are being buoyed by low rates, thus allowing products to be still 'affordable'.

at any price, a very minor 100 basis points (1.00%) increase in interest rates will increase monthly mortgage payments by 8-10% based on 5-year term / 25-year amortization.

the only way to keep the same property 'affordable' is a proportionate decrease in price.
Click to expand...

Agree with this post except for one point.

I don't know that the relationship will be definitely linear...that an 8-10% rise in mortgage payments will result in a proportionate decrease in price. It could well be but it is equally possible that it would be less or more.

I believe this as sentiment of the market will have a lot to do with it. If the market sentiment is still positive and the rate increase is 1 or 2%, it may well hold up or drop less than the 8 to 10%/1% increase.. If it is 3% or more, sentiment may become markedly bearish and the drop could be greater than 8-10%/1% increase.
 
I would like to ask CN Tower for his opinion on 11 Wellesley condos launching May 1. CN would u rate a buy for this area and 60 storey tower on a 1.5 acre park setting if launching from high $600s psf on the ground. Its a sincere question.
 
Article in the Star today summarizing the key points from a report generated by the Conference Board of Canada, an independent, not-for-profit research organization:

Canada’s condo market is likely to “cool gently” rather than crash, with construction starts, and price gains, likely to be modest over the next five years, according to a report released Wednesday.
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Entire article here: http://www.thestar.com/business/2014/04/02/condo_market_to_cool_gently_not_crash.html
 
interested said:
I am curious...would you buy in this setting.
Price is quite high in my view with High $600's on the ground which means $700's/sq.ft. for some height and I am sure parking and locker is extra probably approaching $800sq.ft. I am guessing.
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I know the question wasn't directed at me, but personally I wouldn't buy here. Price is too high especially for a Lanterra built project.
 
interested said:
I am curious...would you buy in this setting.
Price is quite high in my view with High $600's on the ground which means $700's/sq.ft. for some height and I am sure parking and locker is extra probably approaching $800sq.ft. I am guessing.
Click to expand...


I too was curious what CN would say Interested. I know he doesn't agree with my views in the past but wanted to come to him and get his opinion on this site. Yes I am promoting the site, I like the location and park setting, most likely will have ground floor retail etc and is not your traditional box in the sky. Interested...... parking is rarely offered to any unit lower in size than a one bedroom and den and in most cases you have to buy a two bedroom to get a parking spot. I too invest in the select sites I promote, this is why most people don't see me at ever site. Anyways, I am not sure what he thinks. Maybe he doesn't agree with me but rather would just be silent I suppose, just my guess....I know he is very well respected here and I respect his opinion this is why I asked.
 
interested said:
I am curious...would you buy in this setting.
Price is quite high in my view with High $600's on the ground which means $700's/sq.ft. for some height and I am sure parking and locker is extra probably approaching $800sq.ft. I am guessing.
Click to expand...

I have a gut feeling that this project will sell well.

YC condos sold so fast that individuals who had registered on the web site were not contacted. Published reports indicate that Dundas Square has been selling quite well.
 
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