The latest numbers from RealNet Canada paint a picture of rapidly dropping confidence. In Toronto, Calgary and Vancouver purchases of residential development land plunged in the first six months of the year, at the same time sales of new houses and condos slumped by more than a third. Land buys tumbled 51% in Toronto, 52% in Calgary and 30% in Vancouver – a clear sign, say insiders, a big slump’s coming for housing.
“This is definitely a major slowdown which will last for some time,” according to RealNet’s research guy, Richard Vilner. “It’s not going to turn around in the third quarter. There’s not going to be a major correction back to the high-flying land acquisitions of 2011 or the first half of 2012 because there’s still a huge amount of inventory to sell off.’
“I have family in Germany. You know what happens with apartments there? They stay even or go down in value. Over there, homes are for shelter, not some Tom Vu get rich quick scheme. You want to get rich there, you build the best cars, trains and cranes, not ‘marketing systems’ like Bob Rennie and Brad Lamb. “ (greaterfool 7/31/13)
“Debt is endemic. They use lines of credit to make mortgage payments. They routinely increase the size of their home loans to renovate. Four in ten people now say they have trouble paying their monthly bills. And yet 70% own a house. Prices have been bloated by cheap money, not greater income.” GT