patrick.net

No offense, but that sounds like BS to me. Could you give me an example of a home you bought for 5-10% of the previous mortgage? On a 200K home, that would mean you bought it for ~15K.

Investors are going to keep picking up property after property with home equity loans off other properties that are being paid off with rental income from tenants. Investors will own majority of properties, and they will price you out.

a4adam, with those numbers and today's rates I think you did OK. I'm showing a $1300/mo cost of housing for a 15 year at 3.8%. This would decline to $1000/mo by 2020 and after the loan is paid off will be around $700/mo.

Vacaville is a quick shot into the east bay on the weekends, too. For the money you're saving over renting you could go every weekend!

@hooch
Is Canadian economy going strong?
what is propping up these housing prices?

Until unemployment moderates and wages rise I just don't see prices going up. People (and banks) have learned from last time and credit is tighter. Yes, the FHA is loaning as fast as they can but they still have higher standards than Countrywide. NINJA loans are a thing of the past. Also, longer-term demographics of baby boomers retiring will continue to put downward pressure on prices in the mid-high end. Boomers don't have enough money to retire on and will be forced to sell and downsize in order to fund their retirement.

Absolute best-case scenario (for sellers) are flat prices for years. I expect prices to continue falling until they fall in line w/ wages.

I think a lot of boomers can't afford to sell because of property tax differences. A family friend is in his 70s, bought his house in Saratoga in 1968 for $65,000. It's worth over $2M today, and is on a 1/2 acre lot. Beautiful home, and it's paid for.

But if you talk about selling, he's still on a fixed income, and if he moved to even a $400k condo he'd be paying $400 a month or whatever in property taxes. That's significant when he currently pays something like $65/month for property taxes.

Of course, he's been retired for a few years already and has money - but even if he needed money, why would he downsize?

therapy says

and if he moved to even a $400k condo he’d be paying $400 a month or whatever in property taxes.

no, Prop 60 allows you to downsize and keep your old tax basis.

Toronto, like New York City and San Fransisco (and a lesser degree LA), is a place people converge because of high-paying industries and the high concentration of culture, arts, and community (this is where LA falls out of the comparison). These are cities where outside money will always be coming in to buy up overpriced, mediocre housing. Those who work for a living, whether blue or white collar, are stuck moving further out into the burbs to afford anything--which defeats the purpose of living in a city.

I personlly found the suburbs of New York City to be accutely depressing when you considered the hellish commute and high-ass taxes and requirement for having a car (and the high insurance). The only nice towns were far, far out (Westchester, White Plains, most parts of Long Island east of Valley Stream). Houses, while extremely charming on the whole, were usually quite old and full of maintenance. No thank you.

It appears as though this post has been hijacked for an advertisement, so I'm trying to pull it back.

How is it possible for Canadian prices to remain high against headwinds like:

Stagnant/shrinking population size (yes, I realize everyone wants to move to Vancouver and Toronto or Calgary and that is why they are 'special'...)

http://www.google.com/publicdata?ds=wb-wdi&met=sp_pop_grow&idim=country:CAN&dl=en&hl=en&q=canadian+population+growth

A past history of excessive debt-fueled consumption

http://online.wsj.com/article/BT-CO-20110117-706559.html

Indications of declining demand for more housing

http://www.chpc.biz/

http://www40.statcan.gc.ca/l01/cst01/manuf05-eng.htm

AND evidence of currently weak lending standards including low down payments, extended amortization, and financing via 'low' rate variable or short term fixed-interest loans (for which rates will likely increase in the future)

http://www.cmhc-schl.gc.ca/en/co/buho/hostst/hostst_002.cfm

terriDeaner says

AND evidence of currently

not to mention fraud ....

The secret's out on phantom bids

An informal poll of 30 Toronto-area agents taken yesterday by the Star suggests that virtually all believe that some form of phantom bidding exists in the market. More than two-thirds said some kind of structural reform in the way bids were handled was needed to address the problem.

Real Estate Council of Ontario (RECO)

Is that RECO or RICO? :)

52,000 real estate agents?! Unreal. That's 1 agent for every 4 existing houses sold... and 1 agent for every 97 households... and 1 agent for every 254 people living in the province. I wonder how this compares to the number of doctors available there.