Union City floor plan.How much have house prices in Canada gone up? Recently, my friends have been asking me for my opinion on buying a house now.Please Visit: Union City floor plan to Get Your VVIP Registration Today!
Dawei is not a real estate professional, let alone an economist, it is difficult to accurately judge the future, and even there is no rigorous and clear understanding of the current situation. But I always believe that if we stick to our own principles and values and analyze everything from the simplest truth, we can often get the best results.
Canada is a country with extremely uneven economic and cultural development, with more than half of the country’s population concentrated in six major cities. In terms of real estate prices and heat, Vancouver and Toronto are absolutely the first echelon. The two cities also bear the brunt of this year’s boom.
Here I do not look for the average increase figure, the average figure is very difficult to have the perceptual cognition. Take the Baishinan Suri area where I live, for example, at the beginning of 2021, a 1.5 million independent house has risen to about 1.9 million by the end of 2021. A C $800000 townhouse at the beginning of the New year costs 1 million now. In less than a year, the house has risen by 20% and 30%.
Of course, this figure is not strictly representative. The house prices of more than 20 cities in Dawen area are different from each city, and even the prices of the two independent houses next door can be quite different. But according to my observation, there is a 20 per cent increase in the number of houses under 3 million in Vancouver in a year. The demand for houses over 3 million Canadian dollars is not too great, the situation is more complicated, and the rate of increase cannot be generalized.
A similar situation is also happening in Toronto, with a big increase.
Skyrocketing house prices are on the one hand, while housing supply is tight on the other. There are only a handful of houses on the market, and as soon as a good house comes out, you can quickly receive dozens of offer, which can often be sold within a week or two. Now many families who want to change houses do not dare to sell their houses first, because the houses are too easy to sell, and they may not be able to buy new ones if they sell the old ones.
It can be seen with the naked eye that there is a serious imbalance between supply and demand in the housing market, and house prices continue to rise.
There is no doubt that house prices are caused by the long-tail effect of the epidemic. The epidemic has brought unprecedented changes to mankind, housing prices are only affecting the initial performance, the epidemic is likely to have a more far-reaching impact on the future world political structure, as well as economy, culture, science and technology.
From an economic point of view, in order to deal with the economic impact of the epidemic, most countries adopt monetary easing financial policies, especially in western countries, where a large amount of money is overissued, welfare is widely distributed, and consumption is stimulated. However, due to the influence of manpower, raw materials and logistics, commodity prices in traditional manufacturing have skyrocketed.
It is visible to the naked eye that the prices of almost everything in the North American consumer market are on the rise. Forget about food and daily necessities. Take the Acura Mdx, a new car I bought in September. Now the whole line of models has risen by C $1500. After the launch of a car, the model gradually loses its freshness, and with the continuous addition of competitors, its competitiveness is also declining. It was extremely rare before that the prices of cars rose instead of falling one year after they were on the market.
In the United States, the CPI consumer price index stood at 6.2 in October and exceeded 6.8 in December, with inflation reaching a 30-year high. Canada’s CPI index hit an 18-year high of 4.7 in November.
In the general environment of inflation, there is a general consensus that buying a house is the best means to preserve the value of assets. There is a lot of chaos in the capital markets, and ordinary people do not have a good way to manage their finances; and putting money there means rapid devaluation. At this time, most families with spare money will consider investing in real estate and land.
The rapid rise in house prices has also accelerated the pace of families who originally wanted to change homes. Small houses rise more, big houses rise less, and the rising stage of house prices is a hot time for small houses to change into big ones. In addition, new immigrants, who had been overstocked for more than a year, began to land in Canada in the second half of 2021. These two parts of demand also further stimulate house prices to some extent.
Again, Dawei is not an expert, and no one can accurately predict the future. In particular, the real estate price is affected by too many factors, it is more difficult to judge. I tend to trust my intuition on things I can’t control or judge, and analyze the nature of things in the simplest way.
To put it simply, my long-term judgment for Canada’s two major cities, Vancouver and Toronto, is that house prices will continue to rise. But the concept of “long-term” is 20-30 years, or even longer.
The reason is very simple. First of all, the greatest value of a house in North America is in land. For example, a house with a government share price of C $2 million may be worth only 30 or 400000, while the remaining more than 1 million are all land value.
The value of popular urban land is bound to rise with the passage of time. Looking at the history of mankind, the only thing that can really be called wealth is land, and all wars, conflicts and competitions are essentially for land. In any case, it is a good thing to have a piece of land and real estate that belongs to your own permanent property rights in North America, and the more the future, the more the value will show.