TD predicts much lower house prices
Now TD Economics is chiming in with more negativity on the Canadian housing market:
TD Economics now forecasts that Canadian housing prices, already off 3.7 per cent this year, will fall another eight per cent by mid-2011, said economist Diana Petramala. As well, she said, growth in the economy will crawl along for the remainder of 2010 with growth of less than two per cent annualized, edging up to only two per cent in 2011.
That ongoing collapse in national house prices is being driven by the big overpriced markets. I wonder if they’ve got a prediction for Vancouver prices?
That article also points out that the most recent statscan stats show dropping household net worth in Canada for the first time since the recession.
Household net worth — wealth minus liabilities — fell 0.6 per cent, or by $34 billion, to $5.9 trillion in the second quarter, as stock market holdings lost value, and liabilities, particularly mortgages, rose.
It was the first time since the recession that household net worth fell.
“Weak asset growth in combination with still strong liability growth will likely have households feeling buried under more debt than they ever have,” said Petramala
Oddly enough this outlook doesn’t seem to have affected TDs mortgage offerings yet, I wonder if the CMHC has any comment on this?
Thanks to paulb for the link!
September 14th, 2010 at 9:32 pm
Hey Tony Danza,
If by "rectal vision" you mean "Scullboy enjoys the city he's living in" then yeah I've got rectal vision all right.
Jesus, with all the negative comments about Vancouver on this blog and I've got *my* head up my ass?
I think a lot of the bears on this blog are clearly unhappy (Grampy Tinfoil, I'm looking at you). Loads of people have been sitting on the real estate sidelines for years now. It's the right decision to make given the prices, but that doesn't make it any easier, particularly given Van's odd Owner / Renter caste system. Frankly I think a lot of real estate bears have forgotten how to live the place they live. They feel angry and cheated and the relentless "rich Asians! Everyone wants to live here! We're special!" hype machine just makes things worse.
I often wonder why a lot of you are sticking around Vancouver. I see a lot of negative comments. It wasn't the city for me; too expensive and not enough job prospects. Because I wan't happy, I left. Pretty simple story.
@space889:
There's lots of good work on the East Coast. Lots of American banks and tech companies have outsources a lot of work here because the cost of living's really cheap. Lot of Ameritimers went west, got stuck in underwater mortgages so they're stuck… can't come back. I'm in IT myself and I found an awesome job. Not saying the east coast is for you, but you never know.
Halifax is isn't perfect but it's been awesome for me. If being happy means I have rectal vision, well pass me that speculum and get out of the room.
September 14th, 2010 at 3:57 pm
The pimps are all over how inflation is killing the stock market but the same idiots can't relate the same inflation is also killing the real estate market…instead….the market can never go down.
http://www.financialpost.com/news/business-inside…
Calling it every other name…deflation for example….is just an exercise on painting an old whore with dim lights and thick paint.
Its true that Hawaii is a far superior paradise than is Vancouver. We don't have to wade through lumps of fresh feces like you do in Vancouver. The beaches aren't soaked in hospital waste or feces. The fish do not exhibit cancerous lesions like 99% OF sea life in English Bay.
Prices are down here and foreclosures are 50% ++ of the market. The list prices are all over the map…some differant by hundreds of thousands for houses on the same street. In the many years I have been living here on and off I have never seen buisness as generally bad as it is now…lots of small businesses have folded. As I said earlier the rents have turned back some ten years.
The biggest drops have occured in the high end properties. Some sellers are hanging on out of desperation..these are the ones who bought decades ago. There are no crowds on the beaches…and no rich Asian buyers…..in fact this is the first year that there are no Asian tourists visible…..haven't seen 'a one.
September 14th, 2010 at 3:23 pm
Hey "A-sharp"
I just got back yesterday from 2 weeks in Honolulu. Small world or what?
September 14th, 2010 at 1:58 pm
Anonymous Says: It’s all nonsense marketing blurb. When you understand that, you’ll understand that the specifics of the words used aren’t even relevant. ….Lighten up, guys.
And exactly like I said you would, you ignored everything else in that post. Smarten up guy.
September 14th, 2010 at 1:52 pm
Maui! YES!
Same price, which would you rather?
http://vancouver.en.craigslist.ca/van/reb/1951841…
http://honolulu.craigslist.org/mau/reb/1906719802… (note swimming pool and palm trees)
September 14th, 2010 at 1:22 pm
BTW I'm in Maui right now…
The words "best place on earth" come to mind.
September 14th, 2010 at 1:12 pm
@Anonymous:
His post said 'NEW HOMES', not resale. His point still stands.
The uncertainty around the HST could distort the market. This might actually encourage construction now that I think about it. If you build early, you can get the HST deduction off your construction and your buyers might not pay HST should the tax get removed. Together that could result in maximum profits. All that said, the tax won't be taken off overnight, so you would have to really have your timing down to take advantage of this. I would aim for completion on December 31st, 2011.
September 14th, 2010 at 1:11 pm
@Devore:
oops I meant to say "they will say that capitalism is to blame"
September 14th, 2010 at 1:06 pm
Whatever happened to all those Chinese tourists that came (or are coming)…
How come we didn't see a huge spike in sales for August?
Or is there another planeload coming in September?
September 14th, 2010 at 12:34 pm
@Renting:
"Lots of talk today on CKNW was how the HST referendum will delay people from buying a brand new house until after Sep 2011."
I don't think so. Most sales aren't new, they're resale. HST only applies to transaction costs, so will be an insignificant fraction of the purchase. Unless the market is standing still nobody would wait just because of the HST situation. If the market is rising, they'd buy earlier. If the market is falling they'd be waiting anyway, but not because of HST.
September 14th, 2010 at 12:31 pm
'''''''''''''''''''''' ''''''''''''''''' ''''''''''
Dear Mr.Bill Slut:
If you do not start pumping a little harder, and forget the HST over coverage bull,we will have to remove you as Head Pimp, and replace you with the Point Dexter-Metrosexual guy who reads the news for Global.
Just kidding,( I's Keeping An Eye on The Pimps)
The infomercial starring Muir was just too much!
()()
!
–
September 14th, 2010 at 12:26 pm
@space889: As an American who moved from the U.S. in 2006 after 2 years of planning (seeing that the S*would soon HTF), there's a whole world of hurt going on in the U.S. In fact, it makes me reel to think how much things have changed, and makes me sad, too. Make sure you really study up on … e.g. huge unemployment (possibly 10% more than official figures when you count the underemployed and those who have been searching more than 6 mos.). Unemployment…still going up, but data is very manipulated. Not to mention very expensive healthcare (Demo plan only accomplished a couple of minor things), the very high probability that higher taxes are coming for everyone in the future (there's no other alternative), massive devaluation of the USD (already underway for many years, with corresponding impoverishment of an even greater percentage of the disappearing middle class). Add to that very expensive public university educations (2.5 – 3x for in-state tuition compared to what it costs here, for a rapidly declining quality of education there). And of course, the big one, a potentially catastrophic meltdown of the financial system with nothing left in govt. to avert it. Canada will take the hit too, but not so badly, as we started out with smaller deficits and a smaller degree of the sickness. Wherever you are, make sure you are not 100% invested in U.S. assets or currency. Finally, and very importantly, the unraveling of civil society has begun (evidence, immigration and scape-goating of Mexican workers and Muslims) and my guess is that in some communities this will accelerate and decline into occasional riots. (Think about…not enough public funding for the police, fire depts., water system, road repair, schools, and lots of nutcases running around fully armed. Think…the "mexicanization of the U.S." or a nice place to vacation but I don't think I want to live there. I'm from Portland, Oregon, which I think will handle the situation better than most because it has a long tradition of key segments of the community working together for the common good. If you go, consider Portland or similar communities. Of course, you are likely to find cheaper housing…not sure that balances out all the rest, however.
September 14th, 2010 at 12:13 pm
@VHB: "The vote came in favour of showing the bounds"
Why not display both@paulb.: My guess is that yesterday's sales were high due to a high # sales over the Labour Day weekend just clearing subjects. Now onwards with the post Labour Day "sales surge" that usually doesn't happen.
BTW check out Larry Yatkowski's site for Kits SFH. How many were sold in the last month? Three. That's an MOI of close to 20.
September 14th, 2010 at 12:11 pm
Looks like the Vancouver Real Estate sped up its procedures. The highest sold number used to be on Tuesday. Now it is on Monday. I think the "sold" properties on Saturday and Sunday are counted on Monday (used to be on Tuesday).
A high sold number on Monday is normal. Sold numbers on Wednesday, Thursday, and Friday would be best indicators for the market. You should ignore the sold number on Monday or divide the number by 2 to get a meaningful indicator.
September 14th, 2010 at 11:49 am
@Renting:
Ya, uncertainty is not a good thing for business one way or the other. Calling a referendum is a good move by Campbell (hail mary really), but one year is a little ridiculous. A year long campaign is too much for people to take. This should be moved up to later this year or early next year.
September 14th, 2010 at 11:49 am
@Renting:
If people think the HST will go away they are delusional. I wish it would go away too but it's not going to happen.
September 14th, 2010 at 11:37 am
Lots of talk today on CKNW was how the HST referendum will delay people from buying a brand new house until after Sep 2011. If the Referendum passes then it will delay the purchase much further as the HST will not be lifted for some time due the the feds controlling it and the time it will take to reverse.
This should really hurt the new high end market like the OV or a new SFH where the HST is significant.
Add in the negative reports coming out from pretty much everywhere and you have wonder why anyone would still want to buy and not wait for a year or two.
September 14th, 2010 at 11:36 am
vote this comment up if you'd prefer VHB to present the data as +/-xxxx
September 14th, 2010 at 11:35 am
@VHB: I think you should separate the vote into two comments so they don't cancel each other out.
Vote this comment up if you like the way VHB currently presents the data.
September 14th, 2010 at 11:34 am
@VHB:
Would be cool to see the upper/lower MOI bounds too – apart from that, the way you're doing it now looks fine to me.
September 14th, 2010 at 11:31 am
@fixie guy:
"Can’t see the difference between Louisiana’s non-exclusive claim of being a ‘paradise’ versus BC’s of besting everyone else? "
It's all nonsense marketing blurb. When you understand that, you'll understand that the specifics of the words used aren't even relevant. I've no idea why so many people on this blog take a promotional slogan so seriously. Lighten up, guys.
September 14th, 2010 at 11:28 am
@Bubble Lad: as much as I do agree that the “world class” thing being played out, we do have some world class nature available to us here…especially for a medium to large sized city. That, and my family, is about the only thing keeping me here these days.
September 14th, 2010 at 11:22 am
@Boombust:
"First time that I can recall a DEVELOPER throwing product onto the MLS."
There was that place on Barclay St a while back.