[PinkLucy]

It’s a timing thing. We bought then sold a few years back when the condo market was hot. We did it that way because both my siblings sold and then couldn’t find a place to buy … one was “between houses” for a year because once they did buy, they had to do some significant reno work.

 

[Admiral Beez]

Toronto now has the highest housing bubble risk in the world, international report finds

The UBS Global Real Estate Bubble Index ranked 25 major world cities based on the risk of housing market collapse and warned that Toronto shows highly elevated risks. “The index has been flashing warning signals in the last couple of years.”

www.thestar.com

 

[afransen]

Fraud, in the Canadian mortgage market? Say it aint so!

 

[Undead]

Hah, it was a long day at a few industry bodies today.

 

[afransen]

With prices down 20-30% YTD and interest rates spiking, do we think this might be enough to start slowing down the pace of development? Seems like we might start to see too large a gap between new build and resale prices.

 

[Admiral Beez]

With prices down 20-30% YTD and interest rates spiking, do we think this might be enough to start slowing down the pace of development? Seems like we might start to see too large a gap between new build and resale prices.

Some of the GTA's greatest development was when interest rates were double digits. After we arrived in Canada in 1976 my parents in the early 1980s bought a new-build house at Derry Road and Winston Churchill and I believe my Dad said the mortgage was over 15%.

 

[afransen]

Some of the GTA's greatest development was when interest rates were double digits. After we arrived in Canada in 1976 my parents in the early 1980s bought a new-build house at Derry Road and Winston Churchill and I believe my Dad said the mortgage was over 15%.

That would require a lot of adjustment between home prices, rents, and cost of construction. Home prices cannot be 10x incomes with 15% interest--it just doesn't pencil out.

 

[Undead]

With prices down 20-30% YTD and interest rates spiking, do we think this might be enough to start slowing down the pace of development? Seems like we might start to see too large a gap between new build and resale prices.

Only about 10% in my area.

 

[evandyk]

Which basically brings you back to the prices in early 2022!

 

[afransen]

Much of the 905 is off around 30%. Comps to my house are down about that much since the high in Feb.

 

[Admiral Beez]

That would require a lot of adjustment between home prices, rents, and cost of construction. Home prices cannot be 10x incomes with 15% interest--it just doesn't pencil out.

A fair point. When my wife and I bought our three floor, five bedroom semi in downtown east in 1998 it cost about $290k when our combined income before tax was about $60k, or about 1/5 of the house cost. My children won’t be so lucky.

 

[lenaitch]

Some of the GTA's greatest development was when interest rates were double digits. After we arrived in Canada in 1976 my parents in the early 1980s bought a new-build house at Derry Road and Winston Churchill and I believe my Dad said the mortgage was over 15%.

I bought my first house in 1980 and felt blessed by angels to get a 5-year mortgage at 10%.

 

[slickpete83]

I bought my first house in 1980 and felt blessed by angels to get a 5-year mortgage at 10%.

,but how much was your annual income at the time and the price of house? that is the real question.
i would gladly take a 5 year mortgage at 10% if the price of the house was 1/5th of my income

 

[Admiral Beez]

,but how much was your annual income at the time and the price of house? that is the real question.
i would gladly take a 5 year mortgage at 10% if the price of the house was 1/5th of my income

For us to have any market the houses must be 1/5 of someone’s income.

 

[slickpete83]

For us to have any market the houses must be 1/5 of someone’s income.

typo, i meant to say the price of the house 5 times my income