In seams that for the last 10 years all people were talking about in Toronto is when the bubble will burst. But year after year prices continued to go up and are now over half a million! So when will it end? Will it ever? Below are some opinions that we are far from the end.
• A report by Central 1 Credit Union posits that Toronto home values will keep climbing for the next three years and could hit an average of $523,000 by the beginning of 2014 (the current average home price in Toronto is about $500,000). The report also suggests the hysteria over an oversupply of condos is unwarranted. Thanks to the city’s burgeoning population and low-ish interest rates, Helmut Pastrick, Central 1’s chief economist, believes the market will hold steady for a really, really long time: “My 25-year projection for prices would be upward.”
• The Globe and Mail took a look at demographics (with charts!) and concluded that a steady increase in young folks will keep things afloat. Unlike in many developed nations, the number of 20-to-44-year-olds in Canada has been growing steadily since 2007. And since that’s the main home-buying demographic, the logic goes, property values won’t tank.
• In a breathless article, the New York Times focuses on the demand for downtown condos, making the condo boom sound not only sensible but pretty too. The story contains nary a peep about a possible bubble burst or even a market cool-down, but it describes Toronto’s gleaming towers and a “skyline shimmering like a diamond necklace.”
That’s all very reassuring, but would-be buyers would be wrong to think Toronto real estate is a risk-free investment. Always keep in mind that experts were wrong before. Always plan for day when it all will change.
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