Langstaff Gateway Condos developments . The country with the worst real estate bubble? A recent study shows that Canada and New Zealand have become the countries with the worst real estate bubbles. As soon as the report was published, it quickly attracted attention, and many media reprinted the report one after another.Please Visit: Langstaff Gateway Condos developments to Get Your VVIP Registration Today!
As we all know, after a period of surge, there is a real estate bubble in Canada, especially in the big cities led by Vancouver, Toronto and Montreal, but has it really become the most serious in the world?
Niraj Shah, the economist who led the study, used a self-designed “real estate bubble dashboard” to assess the state of the real estate market in each country, which includes four indicators, namely, the price-to-rent ratio, the price-to-income ratio, real house prices and the proportion of household loans to GDP. New Zealand and Canada topped the list of “the most unsustainable real estate market”.
A new round of global monetary easing is likely to fuel the housing bubble, with New Zealand and Canada having the highest price-to-income ratios and the most vulnerable property markets, followed by Australia, the UK, Norway and Sweden.
Nerissa believes that New Zealand’s price-to-rent ratio is the highest in the world, and the price-to-income ratio is also the highest, with two proportional coefficients as high as 196.8 and 156.8 respectively. Canada is only slightly lower than New Zealand in these two coefficients, 195.9 and 155.3. The real house price in Canada is the highest in the statistical country.
Total household loans accounted for 100.7 per cent of GDP in Canada, 94 per cent in New Zealand, 76.3 per cent in the US and 120.3 per cent in Australia.
Mr. Huang, a local Chinese in Vancouver who has long been concerned about Canadian real estate, has reservations about the results of the study, saying that the study is too one-sided through data such as “price-to-rent ratio” and “price-to-income ratio”. And the comparison with the 2015 “benchmark” only represents changes in recent years, but ignores the fact that Canadian property has been undervalued.
However, another recent research report also seems to support the argument that “real estate risk in Canada is high at present”.
In a research paper released in early July, the Oxford Institute for Economic Research pointed out that among the OECD countries, New Zealand, Canada, Sweden and Norway are currently at the highest risk of the property market, followed by Australia, the United Kingdom and Denmark; countries with large economies such as the United States and Germany are at lower risk of impact; and Portugal, Japan and Italy are the least.
The report believes that as the global economic growth slows and investment declines, the risk of a crisis in the real estate market is gradually increasing.
A few days ago, Canadian real estate website Better Dwelling also released a report on the rise in house prices in the United States and Canada. The results show that the rise in house prices in Canada is more severe than in the United States, dwarfing even the most frothy cities in the United States.
The report shows that with 2000 as the benchmark, house prices in several major Canadian cities have experienced explosive growth compared with the major bubble cities in the United States. In the year to March 2019, real estate prices in Toronto rose 239.9%; in Montreal, prices rose 189%, the most exaggerated being Vancouver, where prices soared by 315%.