Wednesday, March 7, 2007

Canada's Strong Housing Market

The Globe and Mail's real estate article today is a comparison in housing market strength between Canada and the U.S. - "Canada's Housing Sector Defies US Trend."

Now that the monthly stats have come out, it does appear that the housing market is not yet declining or degrading in most Canadian cities - Victoria, Vancouver, Edmonton, Toronto, etc. Trends are pushing the market into more of a buyer's market, but the collapse has not yet happened.

We all know about the situation in the US. Things are pretty bad, and I feel sorry for the poor schmuk who got all pumped up after watching "Property Ladder" on TLC, went out and made a huge sub-prime mortgage, hired some cheap labour, and now is stuck with his or her McMansion. Well, maybe by now the mortgage lender is stuck with it, or perhaps the mortgage lender has imploded already. If I had been in a position one year ago to attempt a house flip, I may have. Shoot, if the people on that show could make >$100k per flip, why couldn't I? Thankfully, I wasn't in that position in the US at that time. On the other hand, here in Victoria, money could have been made.

One thing, the comments from Mr. Dugan of CMHC. His comments aren't that far off. But why, whenever a rep of CMHC gives comments, does it sound like they are cheerleaders for Real Estate? Isn't CMHC, a government agency, supposed to be unbiased and neutral? So often, their comments are no more valuable than those of, say, a Realtor. It's like they have something to gain from propping up the real estate market.

Finally, the housing numbers at the bottom of the G&M article are not a fair comparison. They compare Canada's resale home sales and prices against the US's new home numbers.