Comments on: Housing: Up, up and away

By: Canadian Capitalist

Canadian Capitalist — Tue, 27 Jun 2006 00:52:34 +0000

Phil: Great point. Forecasting is the weakest link in investing. Experts are calling a top in real estate for more than three years now.

By: Phil S

Phil S — Mon, 26 Jun 2006 04:23:02 +0000

I live in a condo in Toronto and for years I’ve listened to “experts” say that the bottom is going to drop out of the Toronto condo market and prices will plummet. Since I’m looking to upgrade to a larger condo, I’ve been waiting and watching for this doomsday prediction to come true but so far – nothing! So much for the so-called “experts”!

By: RM

RM — Tue, 20 Jun 2006 03:33:21 +0000

I’d be curious to know what the median house price was…

By: 0xcc

0xcc — Fri, 16 Jun 2006 01:54:10 +0000

I agree that a 47% increase in one year is steep. I think there might be one kind of liar showing up here though (there are 3 kinds according to Mark Twain; liars, damned liars and statisticians). Is what they are saying that the average price of houses sold in a given period has gone up or that the prices of houses in general has gone up in the given period? It is a subtle distinction but that could make the difference. Think about what would happen to the average price of houses sold if a billionaire walked into a given market that say sold 200 homes on average per month and started buying up 10 $1 million houses per month.

If the 47% increase isn’t just an anomoly I agree that it isn’t sustainable.

By: Canadian Capitalist

Canadian Capitalist — Fri, 16 Jun 2006 00:33:59 +0000

Taylor: My fault for not quoting the entire sentence. Here it is:

Soaring house prices have resulted in a growing shortage of lower-priced homes in the resale market, he said, which is crimping sales of lower-priced homes and driving up the national average price.

“With prices on the way up and a shortage of listings in lower price ranges, some buyers may feel that if they don’t buy now, they may not be able to afford to later,” Mr. Klump said.

By: Taylor

Taylor — Thu, 15 Jun 2006 22:26:06 +0000

I’m just wandering what kind of analysts are working for the Canadian Real Estate Association. “Growing shortage of lower-priced homes in the resale market”? Deficit of the low-priced homes pushed all low-priced buyers to buy middle- and high-priced homes? It’s like to
say: the persons who can’t afford Ford Focus should buy Mercedes Compressor. Sounds like creative nonsense.

By: Canadian Capitalist

Canadian Capitalist — Thu, 15 Jun 2006 19:20:46 +0000

Yes, the economy in Alberta, esp. Calgary is very hot. But, a 47% increase in one year? A Globe and Mail report suggests that the main reason is the “growing shortage of lower-priced homes in the resale market”. Doesn’t sound sustainable to me.

By: Taylor

Taylor — Thu, 15 Jun 2006 18:57:51 +0000

Contrary to Oxcc I think what is happening in Calgary is simple demonstration of short economic memory. People are so happy to forget about simple lessons: http://www.expressnews.ualberta.ca/article.cfm?id=7396

By: 0xcc

0xcc — Thu, 15 Jun 2006 12:19:04 +0000

I think what is happening in Calgary is the average household are able to afford the average house so the average house price goes up. The energy boom is having an impact on average salaries in Alberta and it seems like that is being reflected in average house prices.