South forest hill residences.Canadian house prices are divided. There has been a great controversy over whether Canadian house prices are overvalued.Please Visit: South forest hill residences to Get Your VVIP Registration Today!
Many people wonder whether the housing bubble caused by overvalued house prices will burst in the near future. But the reality is that only when the bubble bursts itself can we draw conclusions about whether houses or any other asset are overpriced.
“the current state of the Canadian housing market is worrying, especially the high prices in Vancouver and Toronto.” Recently, an overseas real estate developer who has experienced the Canadian property market said in a chat with reporters that the government does not seem to think there is any problem with such high housing prices.
Compared with the booming property markets in Vancouver and Toronto, the rest of Canada is entering a cold winter. Affected by factors such as oil prices, housing sales in energy provinces such as Asia and Saudi Arabia have been hit, and the different pace of property market development has left government policy makers at a loss as to what to do.
In this regard, there is an analysis bluntly said that the government is indifferent, the key is that the hot property market brings considerable tax revenue, for the government’s “pockets” is very important.
“the divergence of house prices in Canada is likely to continue for a long time.” Canadian real estate agent JackLi told the International Finance News that if the government chooses to crack down on house prices at this time, it will also make homeowners unhappy.
According to data released by the Canadian Real Estate Association, the average house price in March rose 9.4% from the same period last year to 439000 yuan. But if you don’t count home prices in Vancouver and Toronto, it’s only 2.4%.
Housing sales in Vancouver slowed slightly last month after a year-on-year increase of more than 50 per cent in March, but transaction volume is still up 37 per cent and house prices are up 8.5 per cent compared with the same period last year, according to data from the Greater Wendy property Bureau report. the target price reached a new high of 1.002 million yuan. The situation is similar in Toronto, where trading volume rose 17% in April and prices rose 8.4%.
On the contrary, affected by the fall in oil prices, property market transactions in Asia and Sha provinces were sluggish, with turnover and prices falling, falling by 10% by the end of the year as a whole. Diana Petramala, an economist at TD Bank, pointed out that high-end housing prices in Calgary bear the brunt of the decline, further driving down average house prices.
As to whether Vancouver and Toronto can maintain their current vitality in the coming months, Patamara said it is not. She pointed out that since the beginning of this year, mortgage interest rates have been cut by 30 basis points, stimulating the housing market, but this usually lasts for half a year, meaning that the whole market will gradually stabilize by the autumn. In addition, mortgage interest rates are affected by the already high government bond rates, and interest rates are particularly sensitive to high house prices in Vancouver and Toronto.
However, the Canadian government seems indifferent to this. According to Vancouver Courier in Vancouver, if people still think that the government will take steps to save those who want to buy homes in Vancouver’s booming detached housing market, they must first recognize the following facts:
757 million yuan, which is the income from the property transfer tax collected by the provincial government for the whole of last year. It is a big business to be reckoned with. It is estimated that the total income this year will reach 1 billion yuan.
This is the income that the property market brings to the Vancouver city government, and it is enough for Mayor Robinson and other city councillors to avoid talking about two hundreds of percent increase in house prices. The data also show that last year alone, the total value of housing permits approved by Wen reached 1.88 billion yuan, an increase of 77% over 2008. According to the mayor, who has always stressed that Vancouver is short of money, why should he cut off the high income from the construction of new houses?
Let’s return to the issue of house prices. If they are homeowners who have entered the market, they hope that prices will continue to rise, and although people lament the unaffordability of the housing market, no one will be willing to sell their houses at a low price. If house prices fall as a result of government intervention, politicians may no longer want to win the support of these voting homeowners, who are well aware of the political consequences of suppressing house prices.
Some people assert that as long as house prices continue, these politicians will be able to keep their seats. This can be seen when the ruling Vancouver Independent Association (NPA) was ousted by the opposition because of the devaluation of house prices between 1999 and 2002.