(ed: much of this will be familiar reading for aucklanders – wot with their very own ‘insane real estate bubble’..eh..?..just waiting to burst – and already showing signs of creaking-joints/bulging at the seams..
the similarities between toronto and auckland are ‘yuge!’…i mean..they even have a skytower..!..weird..!..)
Toronto’s crazy-insane property prices stayed high even through the 2008 crash and its aftermath but sales volumes of houses of all types plummeted by 40.4% for July 2017-vs-July 2016 – new listings are up by 5% over the same period — and the average selling price has fallen by 19% since April.
April is when the Ontario government put in a few modest measures to identify and tax offshore property speculators – whose money had helped drive annual price-gains of up to 30% – making the city largely unaffordable even to working people with good jobs.
Meanwhile there is a ton of new housing in the pipeline in the form of half-built condos (and condos that haven’t even broken ground) that has been pre-sold – much of it to speculators intending to flip the properties long before they’re built.
Houses are being pulled from the market and re-listed at lower prices and second/third mortgage rates are crazy-high – up to 10% in some cases – endangering the portfolios of heavy speculators – whose defaults would send the amount of listings up by huge volumes as these are people who have multiple homes that they’d lose all once.
Torontonians – like Londoners – (ed: and like aucklanders) are convinced that their housing prices will never decline – writing off the current tremors as local phenomena that only affects the outer suburbs and not the molten-hot downtown core.
But like London Toronto has experienced devastating real-estate crashes in living memory – under conditions that were far less volatile (less global – less leveraged – less unequal) than the current moment.