[ILuvTO]

what is overvalued? people need to stop basing it by average household incomes and think that the average household should be able or worse, entitled to buy a home. look at world class cities in the world (new york, tokyo, london, paris, hong kong, etc.), the average household cannot afford to buy and live in the city. toronto and vancouver and moving towards being top cities in the world, so gone are the days of affordable housing for the average family.

we need to stop thinking Toronto of the past, thinking it's just a cycle of ups and downs of the housing prices. Toronto has evolved and it's time to compare Toronto in light of other top cities and how their housing prices have changed

I've said this before in this thread, and I will say it again.

Real Estate Bulls base their bullishness on vague things (TO is a world class city, people need a place to live, etc, etc).

Real Estate Bears base their bearishness on actual numbers (incomes, price to income, price to rent, debt to income, household formation vs new construction, etc) in comparison with historical norms.

If the bulls could give me some raw numbers to back up their position I would love to hear it. So far all I have heard are vague things that border more on wishful thinking.

 

[interested]

ILuvTO

I am definitely not a real estate bull but I do accept some of the "intangibles" being mentioned here. Toronto is definitely evolving. It is not the World Class City as Marsh correctly points out that New York, London, Paris or Hong Kong are.
Immigration is definitely a factor. The number has been argued up and down as to whether it is 20,000, 60,000 or 100,000 new to Toronto every year. People wanting to live in the core and new office buildings because of gridlock and crumbling infrastructure (the Gardner) may/may not be a factor.

However, I agree with you ILuvTO, I would like to see some "hard" numbers to justify the "bull" argument.

 

[cdr108]

what is overvalued? people need to stop basing it by average household incomes and think that the average household should be able or worse, entitled to buy a home. look at world class cities in the world (new york, tokyo, london, paris, hong kong, etc.), the average household cannot afford to buy and live in the city. toronto and vancouver and moving towards being top cities in the world, so gone are the days of affordable housing for the average family.

we need to stop thinking Toronto of the past, thinking it's just a cycle of ups and downs of the housing prices. Toronto has evolved and it's time to compare Toronto in light of other top cities and how their housing prices have changed

keep saying that as you try to convince yourself you didn't go over your head in debt

 

[CN Tower]

No. Actually we should keep doing that.

Because, when you look at housing in London, Tokyo and Manhattan, people living in $2 million condos are well, you know, making a lot of money. You're mistaken if you think average incomes for people living in Manhattan are not adjusted to the cost of living.

Toronto's demographics and business climate don't even come close to justifying the price appreciation we're seeing. Hell, we're a more expensive city than Chicago these days. And our economy is much, much smaller.

Downtown Toronto average is well over $500 per square foot. Whereas, inside the loop in Chicago, the average is far below that -- it's around $440 per sq.ft.

So pray tell, are you saying that Toronto is in a "bigger league" than Chicago? Chicago's GDP is $554 billion. Toronto's is $260 billion. So we have about the same sized population of Chicago, and economy that's almost 50% the size. Yet our real estate prices are higher ...

Brock is the king of cyber angst. I suppose if I hadn't ridden the property appreciation wave for decades I'd be bitter as well though my nature would be more inclined to look for ways to profit from the trend than to rail against it online.

Toronto is more expensive than Chicago because our economy is much stronger and because our citizens are wealthier. Like most American cities, they haven't emerged from the depths of the financial crisis. Mortgage financing isn't as readily available there either & finally their immigration is stagnant. This is all off cuff facts you can check and verify if you like but I've done business there and that city is not moving forward anymore sadly.

 

[CN Tower]

keep saying that as you try to convince yourself you didn't go over your head in debt

I prefer to think of Toronto as simply a World City. The term sits better with me as it invokes a sense of importance but not a cliched sense of 'me too' desperation.

 

[interested]

I prefer to think of Toronto as simply a World City. The term sits better with me as it invokes a sense of importance but not a cliched sense of 'me too' desperation.

CNTower:

There are World Cities but also Tier 1 and 2 cities:

I would compare Toronto to Chicago or L.A.

I personally do not think we are in the league of New York, London, Paris, Hong Kong.


Interesting issue though. I was in Europe and speaking to people who are looking at investing....Canada has gained reserve currency status. The problem they say is the economy is too small. They would like to invest in Canada and the Canadian dollar and some of that money will flow to Real estate assets. However, because we are a small market economy relatively, flows of capital will bid up our assets. Should we lose this new found status over the past few years, property could well drop as money flows out but at present it lifts our real estate, especially in major growing cities.

 

[daveto]

The Global City ranking puts Toronto in the Beijing/Boston/San Francisco/Madrid range.
http://www.atkearney.com/documents/10192/dfedfc4c-8a62-4162-90e5-2a3f14f0da3a

 

[cdr108]

The Global City ranking puts Toronto in the Beijing/Boston/San Francisco/Madrid range.
http://www.atkearney.com/documents/10192/dfedfc4c-8a62-4162-90e5-2a3f14f0da3a

incidentally, Toronto has fallen from 10th place (in 2008) > 16th place (in 2012).
Chicago was 8th (in 2008) > 7th (in 2012)

 

[Riverdale Rink Rat]

what is overvalued? people need to stop basing it by average household incomes and think that the average household should be able or worse, entitled to buy a home. look at world class cities in the world (new york, tokyo, london, paris, hong kong, etc.), the average household cannot afford to buy and live in the city. toronto and vancouver and moving towards being top cities in the world, so gone are the days of affordable housing for the average family.

we need to stop thinking Toronto of the past, thinking it's just a cycle of ups and downs of the housing prices. Toronto has evolved and it's time to compare Toronto in light of other top cities and how their housing prices have changed

Well, The Economist has France overvalued as well, but my wife's mother and father have an apartment in Paris (they're retired) and her aunt and uncle have an apartment just outside the city (they're retired as well.) Both are smaller than SFD in Toronto, but comparable to DT condos. So, IMHO, you're incorrect in two ways: 1. Of course you need to be able to pay for your dwelling and you will compare buying to renting. These statistics are definitely a good way to relatively value housing. 2. Toronto is not out of line from other global cities, except possibly their most expensive areas (although I have read elsewhere that Forest Hill and Post Road rank very high in the 'most expensive 'hoods in the world' stakes).

BTW -- your second paragraph is classic "This Time It's Different' thinking. Usually the sign of an imminent correction, no?

 

[CN Tower]

incidentally, Toronto has fallen from 10th place (in 2008) > 16th place (in 2012).
Chicago was 8th (in 2008) > 7th (in 2012)

Not to dwell but this proves my point precisely. There are a dozen cities ON PLANET EARTH with more going on than our little metropolis. Not bad people! Cause to celebrate and embrace the progressive momentum. With the Toronto moving up in global financial circles, research, and energy capital markets you can reasonably expect things to continue to improve, most importantly our ability to attract capital, talent & ultimately high paying jobs.

 

[daveto]

Not to dwell but this proves my point precisely. There are a dozen cities ON PLANET EARTH with more going on than our little metropolis. Not bad people!

A dozen? I think you meant fifteen, correct?

Cause to celebrate and embrace the progressive momentum. With the Toronto moving up in global financial circles, research, and energy capital markets you can reasonably expect things to continue to improve, most importantly our ability to attract capital, talent & ultimately high paying jobs.

If we're talking about the report (and I think we are?) it Toronto declining from 10th to 16th since 2008. I'm not an expert in physics, but I don't think that is progressive momentum.

In any event, leaving aside the nitpicking, what the report showed was that there are the top ten cities with scores between 3.3 and and 6.5. And then there is a group of fifteen cities with scores between 2.6 and 3.2, with Toronto (2.9) at the middle of that group.

I would agree that Toronto is a top 25 city on the world stage, albeit in the bottom half of that grouping. I just wish we could describe ourself as Frankfurt/Boston/Vienna, instead of the hubris of claiming to be the next London/NY/Paris.

 

[interested]

Not to dwell but this proves my point precisely. There are a dozen cities ON PLANET EARTH with more going on than our little metropolis. Not bad people! Cause to celebrate and embrace the progressive momentum. With the Toronto moving up in global financial circles, research, and energy capital markets you can reasonably expect things to continue to improve, most importantly our ability to attract capital, talent & ultimately high paying jobs.

CN Tower, not sure I follow your post: Toronto has fallen from 10th to 16th place from 2008 to 2012. I appreciate that other places are improving more but is it "cause to celebrate " that we are falling down the rankings?

 

[rbt]

incidentally, Toronto has fallen from 10th place (in 2008) > 16th place (in 2012).
Chicago was 8th (in 2008) > 7th (in 2012)

Yup. Toronto jumped a bunch of slots when the recession hit everybody else. It's not so much a slide for Toronto as a recovery for many other cities.

 

[CN Tower]

Yup. Toronto jumped a bunch of slots when the recession hit everybody else. It's not so much a slide for Toronto as a recovery for many other cities.

Those rankings are just arbitrary surveys taoilered to desired outcomes by the sponsors.

I celebrate Toronto as a growing city, hyper tolerant with a strong social conscience, that habitually ranks among the world's best in nearly every segment.

Let's make it even better!

 

[littlemissJJ888]

Haven't posted in a while but have been following this topic for some time now. Still waiting for the market to CRASH!! LOL

Found an interesting chart. Looks like the market downturn has already started. Save your money people..

http://torontorealestateboy.ca/blog/