As fears of a housing bubble rise again in Canada The Edmonton Journal set us straight the other day in an article commented about by "RoadRager" on this blog. The author, Gary Lampier took stats from a number of different reports and concluded that there is no bubble in Edmonton, although there very well may be one in Toronto, Vancouver and Victoria.
Here are a few of the most telling stats he posted:
- Average prices: In Toronto, the average bungalow price in the first quarter jumped 13.3% to $459,000, and condo prices rose 10 per cent to $317,500 compared to a year earlier. In Edmonton, the average residential price is $12,000 below the national average at $330,000
- Trends: Toronto's average house prices continued to climb through 2008 and 2009, even as prices in Alberta's major cities declined from the all-time highs set in 2007. In Edmonton, the average price of a single-detached home spiked to a record high of more than $420,000 in mid-2007. Last month, it sat at $388,500.
- Afffordability: 32.9% of median pre-tax household income was needed to service the mortgage on a typical detached bungalow in Edmonton (Calgary 37.1%, National 40.6% - Ottawa and Montreal the same, Toronto 49.1%, Vancouver 69%). For 2-stories Calgary and Edmonton were below 40 per cent, while Toronto and Vancouver were at 58% and 77% respectively.
- Average household incomes: Calgary $113,000, Edmonton $90,000, Vancouver $82,300 (about $2000 higher than Windsor), Toronto $101,400.
- In the U.S. at the peak the ratio of average household income levels to average local house prices got to 10 times or more in overheated markets like Los Angeles and Phoenix. In Vancouver, the average detached bungalow now costs roughly 11 times the typical average local household income level. Yikes!