Dear Amit,

No offense intended... if you read my post carefully I said.."even if they are right I would suspect"... i know its my mistake suspecting even a potentially correct advise...

anyways... thanks for your detailed reply...

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Vik

Here are few links for more info:

http://www.greaterfool.ca/
http://www.thehousingbubbleblog.com/index.html
http://housingpanic.blogspot.com/
http://thehousingbubble.blogspot.com/2005/04/toronto-housing-market-cools.html

There is no investment in world which is always good all the time. RE is good investment but not for at least first time buyer at this point (Timings) when price are dropping and inventory is going high.

1. You can pass your investment/houses/property to next generation if you buy after 2-3 yrs.

2. Doctor, lawyer, engineer, CEO are different kind of profession.
These people are answerable to their management/stock holders/clients about their action/decision otherwise fired. If 500K money/life earning/future is on play then it's not easy to trust anyone.

What is the difference between Fannie Mac/Countrywide and Enron? Enron executives got punishment.

There is lots of good agents/mortgage brokers/bankers are in market. I met one RE agent few months back and we had good discussion.

CREB/EREB/TREB/CHMC/NAR all the RE boards have common copy/paste lines. It’s always a right time to buy because…

1. Summer is right time to buy as price go up in fall as usual.
2. Fall is right time to buy. In winter time people like to gift dream home to their families as Christmas present
3. Winter is right time to buy as price always go high in spring.
4. Spring is always good time to buy as summer is most active housing hunting season for most of families.
5. Price always goes high in long term, strong fundamentals, strong immigration…..bla bla.

Did I miss any weather?

I am not sure how many people have seen CNN/NBC/ABC reporting about families in US who are waiting to loose their homes even both husband and wife are working with 2 jobs each. They completely lost their hope/money/everything. There is no RE board/bank/broker to help them whose were calling 5 times in a day couple of months/years back.

Quote:

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Originally posted by vikshr


Rahul, you suggested prices are 10% down from the peak last year... I don't refute, as I don't know.. what I know is that the properties I was looking for last year are now selling at higher prices than last year...

Would other members like to share their views on the fact as to whether it is really a bad time to buy?... I am thinking of buying a house but after reading this post I am a little confused... sorry if I asked for a discussion on a topic that has already been taken care of in another post...

Thanks

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Dont help others because others have helped you,,,,help others because its the right thing to do!!!

http://www.indopia.in/

That is called "State of Denial" when buyers are not buying and seller are not taking price down. This state can bring only inventory high and price stagnation (or little up). That is a stage before free fall starts in every bubble cycle. Calgary pretty much passes that "State of Denial" stage. You can see your future in Calgary. We are San Diego/FL of housing crash in Canada.

In addition, on Oct 15, it will be much harder for first time buyers in Canada to get 40 yr/0 down mortgages, which has been a major prop to the first time market since 2006. Some banks have been saying that over 50% of 1st time buyers in Toronto, Calgary and Vancouver have been putting less that 5% down in 2007. CIBC/ING/BMO already stopped 40 yr/0 down.

Bottom line is that, supply continues to expand due to new builds, and demand is slow due to a combination of high prices of everything, inflation, tons of layoff in some provinces, and soon to be lower buys many first time buyers unable to qualify for as much financing as in the past 2 years, given the changes announced by the government.

An interesting footnote to all this. In the US, when prices stopped rising, it took 15-18 months for prices to fall in most markets, the whole time the RE spin industry was telling folks it was "simply a lull in the market, and better buy before prices go up again!" What finally brought prices down, was a combination of the mortgage market significantly tightening starting in Aug 2007, and sellers/builders realizing that the boom times were effectively over, so they were more willing to drop prices to the new lower level of demand.

Sales in GTA are significantly lower than in the banner year that was 2007, but they are also returning to before 2004-2006 levels between 78,000 to 81,000 sales in 2008.
Toronto Area is experience 13.8-per-cent lower sales for the first six months.”
It’s still remaining a good Sellers’ market, when avg. prices still going up…..

About Residential ReSales in GTA in 2008:

Jan.2008 sales decreased 2.1%
Feb.2008 sales decreased 11.2%
Mar.2008 sales decreased 22.2%
Apr.2008 sales decreased 7.3%
May.2008 sales decreased 16%
Jun.2008 sales decreased 18%,avg.price up, and and a 22 per cent increase in inventory.

Residential ReSales in GTA from Jan. to June:

2008. 43,685 sales sales decreased 13.8%
2007. 50,648 sales
2006. 45,797 sales
2005. 44,771 sales
2004. 46,398 sales

Toronto building permits down 12.2% in June/08.




http://www.canada.com/calgaryherald/news/calgarybusiness/story.html?id=fad76834-4cd7-4a10-9092-6a23dbb18a91

Quote:

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Originally posted by RESP

Quote:

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Originally posted by vikshr


Rahul, you suggested prices are 10% down from the peak last year... I don't refute, as I don't know.. what I know is that the properties I was looking for last year are now selling at higher prices than last year...

Would other members like to share their views on the fact as to whether it is really a bad time to buy?... I am thinking of buying a house but after reading this post I am a little confused... sorry if I asked for a discussion on a topic that has already been taken care of in another post...

Thanks

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I live in Mississauga and here did not see any price drop rather price is up somewhere between 5 to 15%.

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The market is playing out exactly as it should.
None of this should surprise anyone, except maybe for the how quickly things are falling into place.
There’s no point to delve into fundamentals too much because everyone already knows the market is out of whack.

So where to begin…

People, people… bulls & bears alike. There are some profession who always like to stay in bulls category as their job/earning belong to that category. Did any major bank/govt./real estate board predict about crash a year or 6 months before in US? Are they so stupid? oh no.. Their profession/job/earning comes under bull category. Still they are crying “We already passed bad phase and market will go up” after screwing thousands of family on street. These families are equally responsible for their financial disaster.


First of all, real estate is an asset class. If you look past the fact that people need a place to live. Again we go back to renting and owning are net neutral in terms of demand.
As with any asset class, they fall in and out of favor. And right now, the business climate is such that RE is out of favor.
With the rent/price ratios where they are now, as soon as values stop going up at their required rate, it no longer makes sense to own RE at this point (TIMING). RE also works in cycles. We are already in year 7 if you count 2001 as the first year of the rise of RE.

Now let’s talk about market confidence. Again for the average home owner who bought couple of years back and living in his principle residence with a manageable mortgage payment, it doesn’t really matter.
Economics teaches us about the multiplier effect. It’s all gung ho on the way up, but it’s the same thing coming down.
All it takes is a few desperate sellers to affect prices at the margin. Now all the potential buyers out there are thinking why buy now. I can take my sweet time. Prices are either going to be flat or down anyway.
Meanwhile, I can guarantee you that there are a bunch of sellers out there who cannot carry these properties too long. Renting them out will carry a loss and you can’t sell in a timely manner. What do you do? You have no choice but to drop your price.
Everything coming out of the news right now is negative.
Psychologically this can be devastating.
Right now credit is tightening. There is no bigger killer of an asset class than lack of credit.

News: TD bank also joined CIBC/ING/BMO in 40 yr/0 down red light.

Prices in many areas of Florida, Arizona, Nevada and California have dropped 40 per cent from their peaks of a couple of years ago, to the point where the deals seem nearly too good to be true. In Naples, Fla., a three-bedroom, two-bathroom home that sold for $350,000 in 2007 is on the market for only $200,000. A starter home in Sacramento, Calif., that sold for $215,000 in 2004, is on offer for a mere $129,000. And remember: these aren't sale prices. They're asking prices.


full story

http://ca.pfinance.yahoo.com/ca_finance_general/768/us-real-estate-take-my-houseplease/

Krazzyfour, we will see same pattern here too. Canadian are not richer than average american.


Average single family home sales price down more than $40,000 in past year


http://www.canada.com/calgaryherald/news/story.html?id=da91b343-42b4-439f-a48f-d7a9d4db6f58

CALGARY - One year ago, Calgary's residential real estate market set a record for the highest monthly average sale price for a single-family home at $505,920 in July.

But the market has changed since then and according to the Calgary Real Estate Board website on Thursday the average MLS sale price for single-family homes in Calgary metro for the past 30 days was $462,778.

Also in the past 30 days the median sale price was $410,000 while a year ago in July it was $435,000.
Today, there are simply more single-family homes for sale and a decreased demand for housing compared with July 2007 which also experienced a high volume of sales in the million-dollar plus category. Fifty nine homes sold for more than a million dollars in July 2007.
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Any news on TO area?