TD: Housing correction in one year.
Good news! You still have a year to cash out of the housing market before it ‘corrects’. TD says housing correction coming in 2013.
A correction in Canada’s blistering real estate market is set to take hold in 2013, economists at TD said on Wednesday in a note to clients. The remarks come in the wake of figures released by the Canadian Real Estate Association (CREA) showing sales of existing homes fell 4.5 percent in January from the previous month.
So.. plenty of time to install that laminate, paint the place up and stage it.
“This month’s decline is likely reflective of what will shape up to be a softer year in sales, especially when it comes to Toronto and Vancouver condos,” Jacques Marcil, Senior Economist at TD, said in a note. “We anticipate growth will slow down in 2012 both in terms of sale volumes (+0.5%) and prices (+2.5%).”
“In contrast, the actual correction is foreseen to start in 2013, with both resales and prices turning negative.”
In recent weeks a number of executives at the country’s largest banks and economists have voiced concerns over high real estate values. The head of the country’s largest seller of uninsured mortgages recently told BNN that certain areas of Canada’s real estate sector are “overheated.”
short sale Says:
April 8th, 2012 at 8:23 am
short sale…
[...]Vancouver Condo Info » TD: Housing correction in one year. » Vancouver Condo Info[...]…
February 16th, 2012 at 3:48 pm
@HAM Solo: If current trends continue we will hit 25,000 on June 17th. Of course usually inventory rates slow in the spring. But if the bubble is bursting then all bets are off….
February 16th, 2012 at 3:42 pm
@DEFAULT NAME:
“Do you agree that a house on the market is more likely to be vacant? Yes or No”
Yes, it is.
However you have to compare this reduction in supply with the reduction in demand that is a result of lower incomes, unemployment, people moving in with parents, or leaving town.
The fact is that in no Canadian market where prices have fallen significantly from peak (Calgary, Edmonton, Kelowna & BC Interior) have rents gone up appreciably.
February 16th, 2012 at 2:22 pm
@Vansanity:
I heard it was Harold Ford and the elevator boy, but same principle.
Then again I said that years ago when I heard about an office cleaner who was trying to get several friends together to buy an 'investment' condo.
February 16th, 2012 at 2:05 pm
A couple anecdotes… lawyer I know was downtown at court, 70 foreclosures being filed. These were for properties all over lower mainland.
I order in tonight from a favorite of mine, food showed up in record time. I told the delivery guy I've never received the food so quickly. He said they've been dead. He went on (in broken english) to describe how most people are paying for their homes and taxes they have no money to spend on going out.
I had to laugh… all I thought about was the story of Joseph Kennedy shoe shine story. It's like, when the delivery boy is talking about property costs you know it might be time to sell that shit. Just sayin.
February 16th, 2012 at 1:03 pm
"So.. plenty of time to install that laminate, paint the place up and stage it."
I was sitting in a restaurant today, perusing The Georgia Straight (yeah, nothing else to read). The real estate ads seemed to suggest we are locked in a pre-Olympic state of unstoppable financial frenzy and fortune.
I'll bet my previous landlord, who easily lost a quarter million bucks on the place I just moved out of, is chomping at the bit to buy another one. (Nope, it still hasn't sold)
Maybe we should force everyone who lost in the Real Estate Ponzi scheme to wear a small tattoo on their forehead? In a few years, Vancouver will look like downtown Calcutta.
February 16th, 2012 at 12:02 pm
@Meh: "If 3.2% rent increases become common that adds up to significant inflation. Is that a good thing?"
Don't know, just stating one particular case with which I'm familiar. One thing is clear, though, is that if rent goes up by 3.2% and wages fail to keep pace, that means the local economy suffers.
I hope people begin to understand how dangerous negative real rates are with prices at current levels. I think most readers here do.
February 16th, 2012 at 11:56 am
@jesse: If 3.2% rent increases become common that adds up to significant inflation. Is that a good thing?
February 16th, 2012 at 11:43 am
What a brutal week for sales.
32% lower than the same week last year but we'll see after tomorrows numbers if that holds.
February 16th, 2012 at 11:42 am
Read this in the G&M today. Oh Vancouver…
Five big blunders of 'do-it-yourself' investors