Imminent Housing Crash

[suntan]

Originally posted by rage2

Inner city schools are the best example of that. 20 years ago most inner city schools were for the city's rejects to go to. 10 years ago, they were shutting doors due to low enrollment. Now, they're the trendy designer schools in the public system filled with suburban kids.

Many of them were simply turned into specialty schools. Anyhow the massive uptick of creampies occurring in Calgary in the mid 2000s is the reason for the CBE not having any room left.

[rage2]

Wow, so graphic.

[phreezee]

The slide in Calgary’s resale housing market continued in May and uncertainty about the new NDP government could keep buyers on the sidelines for another few months.

May marked the sixth consecutive month in which MLS sales declined, year-over-year in the Calgary market. It was the fifth straight month in which average prices declined on a year-over-year basis.

Sales were down 25.5 per cent from May 2014, at 2,190 transactions. The average price declined 1.5 per cent to $478,7790, while the median price was down 0.3 per cent to $433,000.

New listings also fell, down 26.7 per cent to 3,161. However, the number of active listings at the end of the month was up 16.1 per cent, to 5,342. Homes are also spending longer on the market — the average number of days to sell a listing was 41 in May, up from 27 in May 2014.

Don Campbell, senior analyst with the Real Estate Investment Network, said political confusion will be a factor over the next six months, as buyers watch for the NDP government to set policy — particularly for key industries in Alberta.

Read On:
http://calgaryherald.com/business/re...y-now-a-factor

[88CRX]

The average price declined 1.5 per cent to $478,7790, while the median price was down 0.3 per cent to $433,000.

So the sky really isn't falling?

[Tik-Tok]

Originally posted by 88CRX


So the sky really isn't falling?

If it's going to fall, I would expect it to take a few more months, when people's severance's start getting low, or EI starts running out, and they look to other cities for jobs.

[Dertz]

creampies
In our society now a days with what we know,
people who don't practice birth control when they aren't trying to have a kid should be shot.

[blownz]

I agree it will be delayed. And I don't think many people were ever expecting a full on crash like in the US. But 5-10% (I personally think closer to 10) is very possible. And while it doesn't seem huge, many people barely have that much equity in their homes so the wealth feeling drops and that makes people spend less on everything else. Just like the huge increase in home prices and the resulting "wealth effect" caused so many people to HELOC things like cars and trips that they normally couldn't have afforded just because they felt like they had money. There is a good chance that will change this year.

[max_boost]

Premium is premium. Beyond homes are still selling for asking.

[blownz]

I know of a house close to $3M that will be sold for less than the cost to build last year. And it was just completed last year, it took about 18 months to build. I think that level is being hit more than the lower end.

[Sugarphreak]

...

[max_boost]

Condo market crashing?!

[Sugarphreak]

...

[BerserkerCatSplat]

June 2014 looks to have been a bit of an odd uptick over May 2014, so that may be amplifying any actual long-term decrease. Also note that only covers 11 days of data out of the month.

[max_boost]

Everyone's waiting for a 17% decrease in year over year average price of SFH haha

[kaput]

.

[gwill]

Considering the luxury market was setting year over year highs every month last year the average price will drop significantly when the luxury market isn't selling half what it was last year.

I'm not a realtor but a simple understanding would help you see why average price could randomly tank one month.

[ExtraSlow]

I think I said this earlier in the thread, but I'll phrase it again as a question. Well, two related questions.

1) If the whole market is down, does that still make this a good time to upgrade? (ex, 5% loss on 500k vs 5% discount on $1million.)

2) Do we have any evidence that higher priced homes (750k+) are selling at a larger discount compared to homes in the entry-level market?



I believe both of these were true back in 2008/2009.

[Feruk]

Originally posted by ExtraSlow
1) If the whole market is down, does that still make this a good time to upgrade? (ex, 5% loss on 500k vs 5% discount on $1million.)

It depends completely on what the market will do go forward. Upgrading increases your risk-reward; in this scenario it doubles it. If at renewal time you have to make up the difference between value and mortgage (likely rare situation), it's easier to come up with 50k then 100k. Until you see a reason to believe the market will turn around, I wouldn't.

[max_boost]

Extra slow are you contemplating levelling up. I believe you are situated in an infill? Standard 25x120 etc. 1800-1900sq.ft, developed basement, in the 650-750 range inner city?

Growing family? Time for the 40-50' wide lots? 1-1.2 range? Good luck man. Property values are holding strong. Premium is premium.

[bjstare]

Originally posted by ExtraSlow
I think I said this earlier in the thread, but I'll phrase it again as a question. Well, two related questions.

1) If the whole market is down, does that still make this a good time to upgrade? (ex, 5% loss on 500k vs 5% discount on $1million.)

2) Do we have any evidence that higher priced homes (750k+) are selling at a larger discount compared to homes in the entry-level market?



I believe both of these were true back in 2008/2009.

1) In my opinion, yes. The market will eventually turn around. Unless Calgary turns into a Detroit (possible, albeit not likely in the short term), the market will go up at some point. IF it goes up, then upgrading in a down market is the way to go. It's my plan for sure, probably this year, pending things slipping like everyone's afraid they will.

2) No idea. haha.