Tuesday, August 26, 2008

Market Update ... Prepare to be confused.

I've avoided any deep analysis of housing market conditions, trends, and predictions lately. Mostly because it all ends up sounding like "on the one hand ... and on the other hand" or simply "I don't know".

Here's what (I think) I do know.
  • The US market is a mess. It's been a mess for a while. It will be a mess for a while. The mess was about as predictable as messes can be.
  • Canada is not the US. Yes, we get some spillover, but the economies, market conditions, regulatory and business environments are/were very different and mostly in our favour.
  • You shouldn't read the newspaper articles about the housing market!
  • OK, you should really. But if you do read them, you should read more than the headline. Almost universally, the headline is bad news and US-centric. Usually the article eventually gets around to explaining that not all the news is bad, and certainly Canada is different.
  • The latest (August 20/08) from down south is that prices are down and there are still more houses on the market. However, under the headline is the information that the number of sales has turned up. The beginning of the end? The end of the beginning? A blip?
  • Canada is not one market. For example, the West and Ontario are both "calming". The West because it got a bit overheated; Ontario because our economy is getting a little beatup by the US problems. Different causes will mean different degrees, durations, etc.
  • Here in Toronto, the market is softening. A bit. There are less deals ... but only compared to a couple of the best years in history. There are less "bidding wars" ... but they still exist, and they always decline in the summer
So there. It's been a wild ride. If anything is happening, it seems more like a "stabilization" than anything to get too concerned about. The market usually picks up about a week after the school year starts (the "Fall Market") with folks trying to solve some real estate issues before year-end. We'll see, but our bet is "a little quieter, but a good balanced market".

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