Quote:
Originally Posted by Dan02
If you're talking the far flung suburbs of Toronto then you should be comparing more to the bedroom communities like Cochrane. None of the suburbs in Calgary are anywhere near as far away as some of the Toronto suburbs.
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I am talking about all of the suburbs. I am talking about the housing supply, both realized and potential, in both cities.
Calgary could easily build as many homes around itself as Toronto has (3 Million homes?) and still have those homes closer on average to the core then Toronto. YET Calgary's perifery pricing is much more then Toronto's pricing relative to the core pricing in each city. It just does not add up in the long term.
Putting it another way, Toronto's suburban pricing should be much higher than Calgary's because the ability to build comparable homes is quickly diminishing. There is only a realized housing supply, with a limited potential supply. Calgary has a small realized supply with a virtually unlimited potential supply. With that kind of future surplus how can prices be supported? Home builders will simply build until they cannot build anymore - which means pricing WILL come down (in absolute terms over the short term or after inflation/price stagnation in the long term - one way or the other).
(Calgary pricing DOES add up in the short term, but anyone who buys now at the height of short term pressure will lose on long term reality of abundent land, increased home building capacity, lower material costs, slowing migration, moderating labour costs, etc.)
Claeren.