The housing inflation that has characterized the housing market in the United States has drifted northward, it seems, according to a report by Sauder School of Business at the University of British Columbia. In a study of nine Canadian cities, seven of them have housing stock that is overvalued by $32,000-87,000. Housing prices were compared to what they would be in a market where home prices and rents would be in balance. Other factors taken into account include mortgage rates, costs of home ownership, and long term price appreciation.
While Toronto prices are in balance and those in Edmonton below by 8%, prices in Calgary, Halifax, Montreal, Ottawa, Regina, and Winnipeg are at least 20% too high. The housing prices in these cities rose 87% between 1997-2006. During the same time period, housing in the Unites States rose 132%.
Whether prices fall in Canada depends on the supply of available unsold homes or discrepancies between the number of available units vs. the number of people ready to occupy them. Because Canadian lending policies have been more conservative than in the Unites States, there is more equity in homes which may allow the market to regulate itself in time. Only in Vancouver are prices expected to decline.
For information about great places to live in Windsor, call your Prudential Select Real Estate Agent Mark Tesolin at (519) 972-5505 or visit http://marktesolin.com
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