TD: Toronto & Vancouver face 15% decline

It seems like one of these bank economist forecasts come out every week, but TD is calling for a 15% decline in house prices here and in Toronto over the next couple of years.

“There have been growing signs that the markets have been tilting towards excess supply of new multiples,” the bank said.

Indeed, condo prices in both cities have shown signs of slowing down much more than the price of single-family homes, the usual benchmark of a market’s overall health.

“In fact, looking at the trend in condo prices, you can see there has been essentially no increase in prices since the federal government first began tightening mortgage rules in mid-2008,” the economists said.

So if the average selling price on a Vancouver single family home is already down 12% year over year and the outlook for condos looks worse… maybe not the best time to buy a presale condo eh?

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[…] they could get about 100K more for their place today than when they bought it. Strange.” – oneangryslav2 at VCI 12 Jun 2012 4:19pm Share: This entry was posted in 01. He Said, She Said, 11. Regrets about Investing in RE and […]

ZRH2YVR
8 years ago

I’ve been quiet for a while on various statistics. One reason is that basically everythinig is bad no matter how you look at it. Well – almost everything. Perhaps someone can shed some light. Just like last month, Van-East Attached is doing pretty good. Sales up, listings down, MOI decreasing. Everything else is showing decreases of sales and increases of MOI. Market wide we should hit just under 8 at end of June. Even the ever strong North Vancouver is having large sales slowdowns and rising inventory. Richmond may end the month with MOI of 14-16 – crazy. Read the Garth post tonight about the supposed Realtor with 17 listings and really nobody buying. Anyhow– not much to say because the message is constant – – it’s terrible, things are down a lot. We are almost on track to have… Read more »

mac
mac
8 years ago

I’m not thrilled with today’s and yesterday’s number. I sleep better when they are below 45% S/L.

VanDweller
VanDweller
8 years ago

Copied from PaulB’s number. Thank you PaulB.
http://www.laurenandpaul.ca
http://tinyurl.com/paulsfacebookpage

Using good-format’s format.

Date      List  Price+-  Sold  Xpired  Inv+-  Inv   S/L(%)
12.05.31   258   160     64      196    -2    18881  25
12.06.01   288   130     147     447    -306  18575  51

12.06.04   340   219     87      145    108   18683  26
12.06.05*  309   173     86      82     141   18824  28
12.06.06*  281   163     82      102    97    18921  29
12.06.07   240   136     97      140    3     18924  40
12.06.08   269   134     96      76     97    19021  36

12.06.11   294   241     113     120    61    19082  38
12.06.12   283   188     162     82     39    19121  57

Total-Cur  2304  1384    870     1194   240          
June-Avg   288   173     109     149    30           38
          List  Price+-  Sold  Xpired  Inv+-  Inv   S/L(%)

*It appears more sales were reported after PaulB published his numbers on this day.
jesse
8 years ago

@Arthur Fonzarelli: 162 sales is not strong for this time of year. The healthy growth of listings is something to watch a bit more closely.

Arthur Fonzarelli
Arthur Fonzarelli
8 years ago

Wow 162 sales posted today. Knowing the mentality of this city, realtors are probably convincing people to “Buy now before the market starts to drop!”

chip
chip
8 years ago

“Many of the “austerity hawks” suffer from a major flaw (or blind-spot) in their economic thinking about austerity. ”

The most obvious one is that no countries except for maybe Estonia is actually practising austerity. A slowdown in spending growth – and continued accumulation of debt – is what passes for austerity these days.

patriotz
8 years ago

@Mick Murphy:
“TD lends 80 per cent loan-to-value up to $900,000, but after that only lends 50 per cent, to protect itself against inflated values on expensive homes.”

These are uninsured mortgages for which the bank is holding the bag.

As for insured mortgages, the message between the lines is that the banks expect to be making a lot of claims against CMHC and they don’t want them to be dishonoured due to sloppy appraisals.

Yalie
Yalie
8 years ago

@oneangryslav2:

Many of the “austerity hawks” suffer from a major flaw (or blind-spot) in their economic thinking about austerity. As Paul Krugman has succinctly put it: “your spending is my income.” Multiply that by tens of millions and you have an economy.

And yet most Keynseyans, especially Krugman, suffer from their own blind spot, namely the assumption that all spending promotes economic growth equally. In other words they assume that a dollar spent on consumption is equivalent to a dollar spent on productive capacity.

As an entrepreneur, I’ve seen businesses that spent most of their capital on product development, and I’ve seen businesses that spent most of their capital on fancy offices and expensive lunches. Guess which ones succeeded and which ones failed?

Anonymous
Anonymous
8 years ago

@patriotz: 80% think there’s a bubble in Van. I’m sure if you did that poll in the streets of Van only 20% would think there is. Most in this city have their head in the sand.

crashcow
8 years ago

“We always talk about how many listings there are in Richmond, but seeing it in pictures is much different”

http://vreaa.wordpress.com/2012/06/12/richmond-listings-iphone-images/

Simple
Simple
8 years ago

@patriotz:

G&M poll question today: Do bears shit in the woods?

46% Yes.

11% No. We are running out of land.

34% Bears will soon shit in houses that they bought for a sizable discount.

9% I’m not sure. I have been in a coma for the last 10 years.

Anonymous
Anonymous
8 years ago

@Anonymous: “what about boasting about “laminate flooring”, really? is that a good thing?”

Better than carpet, in my opinion, but still laminate isn’t exactly quality.

paulb.
paulb.
8 years ago

New Listings 283
Price Changes 188
Sold Listings 162

TI:19121

http://www.laurenandpaul.ca

Anonymous
Anonymous
8 years ago

“I’m always baffled when people take photos of their place with the blinds closed. Or at night. Makes me wonder what’s outside the window that they don’t want us to see.”

what about boasting about “laminate flooring”, really? is that a good thing? again WTF

Anonymous
Anonymous
8 years ago

@Anonymous: “wtf talk about a greedy private seller. That’s like asking $500,000 if they’d used a realtor to sell that piece of crap. Can’t wait till those shitty apartments are worth $140,000 again http://vancouver.en.craigslist.ca/van/reo/3072403197.html

I’m always baffled when people take photos of their place with the blinds closed. Or at night. Makes me wonder what’s outside the window that they don’t want us to see.

no name
no name
8 years ago

@Anonymous
:

did you even understand his comment? To me it means ppl here are way more educated than those covered by g&m.

Anonymous
Anonymous
8 years ago

@patriotz: “Now like all online polls it’s not scientific, but the people who read the G&M web site are a lot more representative of the educated public than the people on this blog.”
agree! finally someone is brave enough to admit of stupidity.

Anonymous
Anonymous
8 years ago

@patriotz: armchair economist, how the heck do you know they are paying 2x rent? let me guess, your cracked crystal ball that you brought from van to ottawa with you?

patriotz
8 years ago

@Anonymous:
You’re quite right that a change in market price – either up or down – is only a paper gain or loss.

But the 2x rent that they’re paying every month isn’t.

Anonymous
Anonymous
8 years ago

@oneangryslav2: how do you know that they have lost 80k? stupid bears are funny; when the owners have equities in their places, stupid bears say that it’s only paper gain. when nothing happens to the market, stupid bears can estimate the loss. you must be jealous of your in-law! and one angry slav.

Mick Murphy
Mick Murphy
8 years ago

“Several Canadian banks have been quietly re-evaluating their appraisal strategies amid increased worries about the accuracy of property values
in a market deemed at risk of overheating.”

http://www.theglobeandmail.com/report-on-business/banks-go-on-appraisal-alert-in-a-volatile-housing-market/article4253999/

Bull! Bull! Bull!
Bull! Bull! Bull!
8 years ago

@jesse:

Those are interesting points. Have made predictions in the past which have been wrong? If so, what makes these predictions better? Why are these reasons better than the reasons given in the past?

“Three reasons (in order of importance) why this year is different from recent past years:
– Population growth is down 40% from 2008;
– Completed units will start increasing in Q3 and Q4 of this year;
– People who prematurely took the plunge into home ownership (as occupiers or amateur landlords) in the past few years will increasingly feel the unexpected pains of property management and have fewer avenues to exit safely.”

Makaya
Makaya
8 years ago

@Anonymous: wtf talk about a greedy private seller. That’s like asking $500,000 if they’d used a realtor to sell that piece of crap. Can’t wait till those shitty apartments are worth $140,000 again

Did you see the irony in the posting? The building is called “The Black Swan”…