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Thanks for clarifying. Totally agreed that economically speaking Toronto is more diversified and stronger than Van and a collapse in housing will crush Van. IIR

by kareemm 10y ago

Thanks for clarifying. Totally agreed that economically speaking Toronto is more diversified and stronger than Van and a collapse in housing will crush Van. IIRC real estate, construction etc still produce more than 10% of Toronto's GDP. Still don't totally understand "why now" wrt Toronto's market taking off if the answer doesn't include foreign money as a main driver.

randomdata 10y ago
Why now? Perhaps because millennials are getting older? Next to the boomers, they represent Canada's largest generation, and within the last 5 years started to reach the age where one normally starts to gain meaningful savings and starts to settle down to raise a family. They are also more likely than previous generations to want to live in the downtown of major cities. They also reached this stage of life as we dropped interest rates to practically zero, enabling them to afford much more than anyone before them. What was being served by dorm rooms (if you recall, the postsecondary schools had to go build-crazy in the early 2000s to accommodate these same people) and bachelor apartments rentals now wants to own multi-occupant homes – preferably of the detached type – without having to leave the area they established themselves in during early adulthood. I don't think foreign money can ever explain "why now". Even if we agree that there is foreign money being invested, there still has to be some underlying driver to make them stand up and take interest in that investment opportunity. We can assert that it is not simply foreign money wanting to own a piece of Canada, as many parts of the country are only keeping up with inflation, and sometimes not even that. I think there had to be some change in the makeup of, most notably, Toronto and Vancouver that made it appealing now, and I suggest it is down to these demographic shifts.

by kareemm 10y ago

randomdata 10y ago

Why now? Perhaps because millennials are getting older? Next to the boomers, they represent Canada's largest generation, and within the last 5 years started to reach the age where one normally starts to gain meaningful savings and starts to settle down to raise a family. They are also more likely than previous generations to want to live in the downtown of major cities. They also reached this stage of life as we dropped interest rates to practically zero, enabling them to afford much more than anyone before them. What was being served by dorm rooms (if you recall, the postsecondary schools had to go build-crazy in the early 2000s to accommodate these same people) and bachelor apartments rentals now wants to own multi-occupant homes – preferably of the detached type – without having to leave the area they established themselves in during early adulthood. I don't think foreign money can ever explain "why now". Even if we agree that there is foreign money being invested, there still has to be some underlying driver to make them stand up and take interest in that investment opportunity. We can assert that it is not simply foreign money wanting to own a piece of Canada, as many parts of the country are only keeping up with inflation, and sometimes not even that. I think there had to be some change in the makeup of, most notably, Toronto and Vancouver that made it appealing now, and I suggest it is down to these demographic shifts.