Investors keep running to the arms of housing

It's going to crash, it's going to crash.  How many times have we heard this about the Canadian housing market?  Sometimes commentators use more tempered language to describe a predicted "pullback" or a market that is gong to "moderate."  The problem is that outside of the 2008 recession, when prices corrected 10% followed by a boomerang recovery, it has not been true.

How do you argue with almost 13 years of uninterupted growth when the average sale price of a home in Canada has climbed from $152,365 in 1998 to $366,105 year to date in 2011.

That's a 140% increase, but who's counting?  Apparently, a few investors.

Canada Mortgage and Housing Corp. says September new home construction on an annualized basis was above 200,000, a level consistenly hit on a yearly basis from 2002-2008.  But this time out, a majority of the  new construction was condominium apartments.

Existing home sales, though not as buoyant, have stayed above 2010 levels and even added another 8.2% appreciation.  Why would consumers turn away from housing, when all it does is go up?  Not to mention the low interest loans that are there for the asking.

At one point, there was some tough talk about tightening lending but the only substantial change has been shorter amortization periods.  You can still get into the market with as little as 5% down and borrow at rates below 3% because the government of Canada is backing your debt.

And still people like.....Read More

Source of Photo and Text: Financial Post

KELOWNA average house (single family residential) sale price:

• $184,745 in 1998
• $514,562 year to date 2011 (Jan-Sept)
• 178% increase in 13 years!

WEST KELOWNA average house sale price

• $181,925 in 1998
• $488,234 ytd 2011
• 168% increase in 13 years!

KELOWNA average strata (townhome and apartments) sale price:

• $125,536 in 1998
• $296,812 ytd 2011
• 136% increase in 13 years!

WEST KELOWNA average strata sale price:

• $116,205 in 1998
• $298,440 ytd 2011
• 156% increase in 13 years!

KELOWNA average manufactured home sale price:

• $30,705 in 1998
• $72,024 ytd 2011
• 134% increase in 13 years!

WEST KELOWNA average manufactured home sale price:

• $39,336 in 1998
• $101,442 ytd 2011
• 157% increase in 13 years!

Okanagan Mainline Real Estate Board shows Kelowna has 1,114 homes, 968 strata and 47 manufactured homes actively listed fior sale and West Kelowna, 578, 189 and 129 respectively.  At this time there still is a good selection in Kelowna and West Kelowna.

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