![\"macleans-housing-market-crash\"](\"https:\/\/www.livabl.com\/articles\/wp-content\/uploads\/2016\/03\/macleans-housing-market-crash.png\")
<\/a><\/p>\nThe bears are restless.<\/p>\n
Canada\u2019s housing market is on a blazing trail \u2014 albeit propped up lately by sales in the Greater Toronto Area and Lower Mainland Vancouver \u2014 as its performance continues to fly in the face of dire predictions from grizzly observers.<\/p>\n
Driving this point home, Douglas Porter, BMO\u2019s chief economist, says the average sale price of a Canadian home hit an all-time high of more than $500,000 this February (hardly a bear market, a term that denotes falling prices and selloffs). \u201cThat\u2019s more than 60 per cent versus 2008, about the time the bears starting growling,\u201d adds Porter of this price appreciation.<\/p>\n
His statement comes from a note titled \u201cCanada\u2019s Non-Goldilocks Housing Market & the 33 Bears\u201d \u2014 a goldilocks market is a mediocre one; it\u2019s not too hot or cold \u2014 in which Porter pulls quotes from dubious housing market commentary over the past decade.<\/p>\n
\u201cDa Bears may some day be right, especially on the hottest markets, but getting the timing down is half the challenge,\u201d Porter concludes. BuzzBuzzHome News has paired six of the forecasts Porter Highlighted with data from the Canadian Real Estate Association (CREA) and others to show how wrong the pundits got it.<\/p>\n
2008: Canada\u2019s housing bubble could soon burst<\/h2>\n
Sure, it could have \u2014 but it didn\u2019t. However, 2008 was the last time resale home prices declined from the preceding year, with prices dropping slightly to $304,593, according to CREA. In 2007, the average home price had been $306,784. Still, as time passed, it becomes clear this scenario from the Ottawa Citizen<\/em> via a Merill Lynch report<\/a>\u00a0never materialized, no matter how liberal your interpretation of \u201csoon\u201d may be.<\/p>\n Although average new-home prices were down 2.3 per cent compared to 2008, resale prices were heating up around this time. The average price of an existing Canadian home was up five per cent by the end of 2009 over the previous year, according to Statistics Canada. In hindsight, that didn\u2019t bode well for this opinion piece in the The Tyee<\/a>.<\/p>\n \u201cSeveral factors tend to contribute to the growth of a housing bubble: low mortgage rates, access to easy credit, net immigration and the stock of available housing,\u201d highlights this Canadian Centre for Policy Alternatives<\/a> report authored by David Macdonald. While observers have raised flags over all of these factors since 2010, Porter and company are still waiting.<\/p>\n Nope. In fact, from 2011 to the end of 2015, the average sale price for a Canadian home has done pretty much the opposite: it increased about 22 per cent to $443,004, according to historical numbers provided by CREA. \u201cHey, forecasting is hard,\u201d says Porter. \u201cBut let\u2019s not give a pass to some of these scare-mongers who have been dead wrong,\u201d he adds, nodding to this line, likely a reference to Capital Economics economist David Madani\u2019s prediction from that year.<\/p>\n That forecast was looking ahead several years, but as recently as February 2015, Madani was still toeing the line, according to the Financial Post<\/a><\/em>. \u201cPrices will have to drop 45 per cent for Capital Economics to be right once you factor in the 20 per cent in price gains that have materialized since the 2011 call,\u201d Phil Soper, Royal LePage\u2019s president, explained to the paper then.<\/p>\n2009: Why Canada\u2019s housing bubble will burst<\/h2>\n
2010: Canada\u2019s housing market: An accident waiting to happen<\/h2>\n
2011: Canadian home prices will crash 25%<\/h2>\n
2012: Canada\u2019s housing crash begins<\/h2>\n