Festival condos review.House prices in Toronto, Canada fell into a bear market. Toronto became the city with the highest return on overseas home investment in the first half of this year, and many people lamented that they had not caught the Fortune Express.Please Visit: Festival condos review to Get Your VVIP Registration Today!
But Toronto real estate began to decline sharply in the second half of this year, with the average price of all homes in Toronto at C $732292, down 20.5 per cent from its peak of C $920761 in April. Home sales in the greater Toronto area fell 34.8% from a year earlier to 6357 units. By this standard, Toronto real estate suddenly reversed in the second half of this year and has entered a bear market.
To cool the frenzied market, the Ontario government introduced a series of measures on April 20th. One of the most striking measures is a 15 per cent home transfer tax on non-resident foreign speculators. You should know that the surge in house prices is mainly affected by speculative capital.
On the other hand, the Bank of Canada began to raise interest rates, raising the cost of home buyers while cooling expectations of a rise in the housing market. In July, the Bank of Canada raised its overnight target interest rate by 0.25 percentage points. Another rate hike is expected in December to coincide with a possible Fed rate hike at that time.
In fact, the rise in Canadian house prices before the first half of this year was mainly caused by foreign immigrants. According to Canadian authorities, about 8000 millionaires moved to Canada last year. Chinese immigrants prefer Toronto, while Europeans prefer Vancouver and Montreal. At the same time, too low interest rates have prompted more speculators to invest in Canadian real estate, and cities such as Toronto and Vancouver have become the hardest hit by rising house prices.
Looking at the global house price index list released by Hurun Research Institute, after Canada, Chinese cities also have six of the top 10 increases in global house prices, in addition to Wuxi, which has become the fastest growing city in the mainland. Zhengzhou, Changsha, Guangzhou, Shijiazhuang and other cities are also among them. As the fastest rising real estate prices in the world, Toronto real estate is now fluctuating violently.
First of all, Toronto real estate transaction volume and house prices have both plummeted, which precisely shows that without the effective support of the purchasing power of local residents, the real estate industry will hide a crisis even if it is booming on the surface. In fact, the house should be for people to live in, and must not be used for hype. Once real estate puts on the cloak of finance, then its volatility will increase significantly. Therefore, it is very important for mainland finance to reduce leverage and real estate to return to rationality.
Moreover, low interest rates are the main culprit for the rise in house prices in any country. Whether in Japan in the early 1990s or now in Toronto, Canada, it was the government that raised mortgage rates, which led to a big reversal in house prices. And for now, with the Fed announcing monetary tightening and the Canadian dollar pegged to the dollar, the Canadian real estate adjustment period has only just begun.
At present, domestic banks are also raising interest rates, which used to be a 15% discount on the benchmark interest rate, which was later cancelled, and now some banks have raised the lending rate to 20% of the benchmark interest rate, which is not only to increase the purchase cost of property speculators, but also to reduce the leverage of housing loans to prevent the occurrence of more systemic financial risks.