Vancouver Real Estate Takes Off - Toronto's Grounded

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Posted by Brian Ripley - Canadian Housing Price Charts

on Thursday, 09 November 2017 06:41

chart-compare-vancouver-toronto 12 orig


At the old Vancouver price peak in April 2012 before Torontonians joined the party, Vancouver metro SFDs were 64% more expensive than Toronto comparables. In July 2016 at the peak of Vancouver SFD prices, they were 65% more expensive. 
The gap was closing quickly; it narrowed down to 33% in June 2017 but with the sudden late summer zeal to buy in Vancouver and sell in Toronto, the gap remains wide at 60%. Strata prices are also more expensive in Vancouver; 27% more for town-houses and 23% more for condos.

In March 2017 the Monthly Absorption Rate based on total inventory and total residential sales hit 154% in Toronto vs Vancouver at 47%. Vancouver may have led the FOMO crowd up the ladder, but Toronto is sending them down the snake.

​Here is another attempt to visualize the distortions of the market where the fundamental requirement of a yield to attract sustainable investment in real estate has been replaced with the lure of capital gains. 
SFD Values

This chart shows the relative values of STRATA units as a percentage of average single family dwellings in the 3 hot markets of VancouverCalgary and Toronto

​Calgarians are willing to trade 1 house for only 1.3 townhouses. Torontonians will settle for 1.6 townhouses and Vancouverites demand 2. 

The "improvement" that sits on the land is a wasting asset. If serviced land is so valuable, shouldn't the ratio be 1 house equals at least 3 townhouses? 

If the numbers don't make sense you can always rent. When MOI is low & MAR is high, developers and vendors have the edge.​


SFDs vs Earnings

SFD Prices are up:
120% in Vancouver
21% in Calgary
105% in Toronto
​Employment Earnings are up:
24% in BC
30% in AB
23% in ON

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