Quote:
Originally Posted by Azure
My original question was also ignored.
Do people honestly believe Toronto & Vancouver housing prices were driven by actual demand and not external shady circumstances?
Why is Vancouver SO much higher than Montreal? Calgary? And why has it been higher for so much longer than other cities in Canada? Where is the money coming from that is driving that insane demand?
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I thought he answered your question though... sprawl. And to a certain extent, yes. Actual demand. Temporary FOMO demand, so the demand will crash once the FOMO momentum is gone, but still demand none the less.
Toronto and Vancouver don't have the ability to spread out further. Toronto is already surrounded by other areas that limit the city's ability to expand. You'd be in a different jurisdiction past the Toronto limits. This isn't the same case as other cities like Calgary, Edmonton, Montreal (I believe), Ottawa etc. There's space to go further out. Vancouver is similar to Toronto but geographical before hitting the other cities. Both have spent a lot gentrifying their centres spiking prices. Those charts are nuts showing 30-40% for BC and Ontario whereas the other provinces are in the single digits.
Lots of the money is not purely shady such as asset parking of several years ago. It's debt. I know of many friends in Toronto and Vancouver whose parents with paid off houses that have shot up in value since they were purchased decades ago, pulled out huge HELOC loans to help down payment on their kids' expensive homes. They also typically guaranteed their kid's loans too.
Another huge factor that I noticed locally too, is foreign source wages paid to people who WFH in the Calgary and Edmonton area. I don't know the real numbers, but it seems like there's a lot of people in Calgary who are working from home/getting more work from the US while maintaining residence here. This is a huge difference and a major boon for many people here who were without jobs for a while due to the local recession. This helped to spur a lot of housing purchases in the area, especially as many started upsizing their home to address long term WFH outlooks.