South Forest Hill Residences for sale.The house price in Canada is 50% higher than that in the United States. When it comes to house prices, many people will talk about the high housing prices at home. However, high housing prices are not just in China. Some developed countries where people live in affluence also suffer from high housing prices. For example, Canada, one of the countries where Chinese people are most keen to buy houses overseas.Please Visit: South Forest Hill Residences for sale to Get Your VVIP Registration Today!
There have been many reports about high house prices in Canada, which are nothing new, but it is worth noting that as house prices continue to rise, more and more research institutions have begun to warn of the risk of house price collapse in Canada.
New home sales prices in Canada rose for two months in a row, up sharply from the same period last year, according to data released by the Canadian Mortgage Real Estate Corporation (CMHC). The average price of a new home in Canada in April was C $751881 (US $559123), according to data. In Canadian dollars, it rose 11 per cent from a year earlier; in dollar terms, the increase was more moderate, at 2.64 per cent.
So whether the trend of house prices is high in the end, we can compare it with the United States, which borders it.
Compared with Canada, house prices in the United States have declined over the same period. The average price of a new home in the United States in April was C $495271 (US $368300), according to the U.S. Commerce Department’s Census Bureau (US Census Bureau). In Canadian dollars, it is down 0.49% from a year earlier; in dollar terms, it is down 3% from a year earlier.
It can be seen that the average selling price of new homes in Canada is 51.8% higher than that in the United States, while in the same period last year, the average selling price of new homes in Canada was only 36% higher than that in the United States. This shows that the divergence between the Canadian and US real estate markets is increasing.
If you take into account the differences in economic conditions between the two countries, the gap in house prices is even more unreasonable. The economy of the United States is recovering, and its population is 10 times that of Canada, but its land area is smaller than that of Canada. Canada, by contrast, is sparsely populated and its economy is unstable.
According to Wall Street reports, Canada’s home ownership rate is currently 70%, the highest in the world, while the home ownership rate in the United States was about the same before the bursting of the housing bubble. The real estate industry now accounts for 12% of Canada’s GDP, and real estate was one of the main drivers of the economy during the US real estate bubble.
Wall Street gold short seller Marc Cohodes, who has been shorting the Canadian real estate market since 2015, once told the media:
Canada’s housing bubble is no less than that of the subprime crisis in the United States, and he called Vancouver’s crazy housing market a mixture of money laundering, speculation and low interest rates.
In addition to high house prices, the potential for future interest rate rises may also be the last straw to crush house slaves.
A recent survey by Manulife Bank found that 72 per cent of Canadian house slaves could not afford a 10 per cent increase in monthly payments. According to Wind, the average monthly payment in Canada is about $1000, an increase of $100, which is beyond the affordability of most Canadian house slaves.
In February, Manulife Bank surveyed 2098 homeowners aged between 20 and 69 with an annual income of no less than $50, 000. Among them, 14% of the homeowners said that the current monthly payment is already the limit they can afford; 38% of the homeowners surveyed believe that it is no problem to increase the monthly payment by 1-5%; only 20% of the homeowners think that the monthly payment increase of 6-10% will not feel too tight, but can not afford more.
In short, 72% of Canadian homeowners surveyed have more than they can afford to increase their monthly payments by 10% on the current basis.