Yes, there’s a housing bubble

Painted turtle pointed out this article in the Vancouver Sun: Yes, there’s a housing bubble in Canada — but only in three cities.  You read that correctly.  The Vancouver sun printed an article calling the Vancouver market a bubble.  I hope Beelzebub has some of those left over Olympic mittens.

According to a national study released last year by Pitney Bowes Business Insight, the average household income level in Calgary topped $113,000, while the average in Edmonton exceeded $90,000.

Vancouver was well behind both Alberta cities, at $82,300. That’s about $2,000 higher than Windsor, Ont., which has some of the lowest house prices in Canada. Toronto boasted average household incomes of $101,400.

Let’s look at it another way.

When U.S. house prices got to their most extreme levels during the U.S. housing bubble, the ratio of average household income levels to average local house prices got to 10 times or more in overheated markets like Los Angeles and Phoenix.

In Vancouver, the average detached bungalow now costs roughly 11 times the typical average local household income level, based on the data above.

Read the full article at the Vancouver Sun website.

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[…] members of the public, trapped in disinformation bubbles, for whom this will be news. Thanks to  nonymouse (at vancouvercondo.info 29 Apr 2010 10:24 am) who broke the news of the posters and, at our request, forwarded these photos. […]

Kite towards moon
Kite towards moon
10 years ago

@Is Kite is Good:Home ownership is not a bussiness,however,buying a place to live or as investment will begin with ability to carry monthly expenses and the extent of loss you can take in any other circumastances.There is no advice to switch over your target,Your current circumastances and financial future will help you decide to click on the cost of home or apartment areawise.If you feel comfortable then buy if not then just rent a place.I think it's good to buy re-sale home instead of new homes for efficiency purpose.Homeowner as seller will have it repaired for you and you would be able to run inspection.The service response to national home warranty programme is like you are talking to somebody who is dead but somehow they will pick up phone to secrew you up further.

Neptune
Neptune
10 years ago

@paulb:

Close to 400 sales, that's massive.

doug r
doug r
10 years ago
Is Kite is Good
Is Kite is Good
10 years ago

Kite, I have a pre approved mortgage but act fast I needs, but with all these rich asians coming i need your help.

Where should I buy tomorrow?

Hurry I am running out of time. I am approved for $570k so please give me some options.

Also if I move to a house I want to get maximum rental potential so please help me with future rental needs. I want ot rent ot a bitter bear and makes maximum cash!

Absinthe
Absinthe
10 years ago

@ulsterman: 58K in 2005. 2007 (last reporting from StatsCan) – 66K. I imagine it's not up much from that, but I could be wrong.

But yeah, even still, dollars are being stretched. And credit maxed.

Animal Spirit
Animal Spirit
10 years ago

could be seeing the final push from the April 19 deadline – everyone would want things to close prior to the weekend and May.

Matt
10 years ago

Check out how they're dealing with oversupply in Ireland:
http://www.belfasttelegraph.co.uk/breaking-news/u

" A Green minister in charge of planning rules has backed plans to bring in the bulldozers to tackle massive oversupply of property.

Ciaran Cuffe, appointed to the job in last month's reshuffle, said he supported selective demolition as some loans taken over by bad-bank Nama will be so worthless buildings may have to be flattened.

"

ulsterman
ulsterman
10 years ago

$58,000 median household income?!? How do families live on that kind of income in the Lower Mainland? Baffling.

We live in such a bizzaro-world here. We have supposedly wealthy enough to bid average houses over $1m, yet we can't keep schools open for a full school year. Curiouser and curiouser…

Dan in Calgary
Dan in Calgary
10 years ago

The Ottawa Citizen has a story announcing that, according to MoneySense magazine, Ottawa has been chosen as the best place to live in Canada! Shhhhh! Don't tell anyone that owns real estate in Vancouver; they won't be able to handle it; their future financial and emotional well-being depends on them believing that Vancouver is the best place on earth to live, and that everyone wants to move here.

Drachen
Drachen
10 years ago

@PJ:

Sales lag by about two weeks. We're seeing the pre-April 19 rush to buy still playing out.

Arranging a mortgage doesn't happen overnight and there's details like inspections and such that can be built into a contract so the sale isn't final until all the conditions are met. That's when it's recorded, not when it's signed.

Drachen
Drachen
10 years ago

@Anonymous:

"What is the historical months of inventory for this time of year?

Does anyone have a link"

http://agentwill.com/weekly-stats/

http://vancouvercondo.info/forum/topic/total-inve

The first only goes back to 2008 but has a wider variety of stats, the second starts in 2006. The reason for the inconsistency in numbers is they're using different regional boundaries.

PJ
PJ
10 years ago

I can't believe hos strong sales are still even after the April 19th deadline.

JR
JR
10 years ago

Hey Paul

I don't know for certain but that looks like an extremely high level of sales. Is this still largely a pre-April 19th rush?

Keeping an eye on Th
Keeping an eye on Th
10 years ago

Kite you are a fool.

It is said that those who worry about other people's sheep, risk loosing their own flock.

Don't you have your own blog?

Anonymous
Anonymous
10 years ago

@paulb: What is the historical ratio of listings to sales?

What is the historical months of inventory for this time of year?

Does anyone have a link

Boombust
Boombust
10 years ago

If you're interested in a late nite laff 'n' snooze, go to the CKNW Audio Vault and listen to Michael Levy's BS re" the "housing bubble" on the Bill Good Show…11:00 am time slot.

You'll hear about how rock solid Canadian banks are…

Bob Rennie's prediction on the "lower-end condo market 4-5 years from now"…

Asian money will keeping propping up the West Side…

Zzzzzzzzzzzz

paulb
10 years ago

New Listings 389

Price Changes 160

Sold Listings 271

16,919 not too shabby

Kite towards moon
Kite towards moon
10 years ago

oho that combination of beer and bear become funny.however,someone is in search of beer without money,I hope he won't able to steal the bears before party.Wish you all good good luck!

Nero
Nero
10 years ago

@paulb:

Wow, if you told me that there would be 266 listings in the Spring, you'd normally (lately) expect it to be 125% of sales.

Yet it keeps getting dwarfed by the ever faster rising amount of listings!

Like a Kite towards the Moon, you could say.

Kite towards moon
Kite towards moon
10 years ago

@paulb: What's the point while everyone else is buying? One of my friend she actually went for walk and she bought a condo on her way.Why only your customers(bears)are too lazy? Oh maybe there is a bubble in their tugs that's why there is no way to keep them on ice.They can not play,They could have bought long ago,if they were able to walk off the screen.I think they are here to count listings go up and down.

other ted
other ted
10 years ago

Well with a normal distribution mean and median should be the same. The fact that it differs so much shows the distribution is skewed. We are no longer a healthy middle class city but on where a few rich can skew the average. Becoming more like a third world city.