Housing

Over the last 14 years, house prices in Canada have increased by 150%, twice as fast as in the U.S...[and] far outpacing household incomes. Any increase in interest rates would prick the bubble, and its implosion would trigger all sorts of mayhem to the point that the Canadian government has expressed concerned that such an event would be a significant risk to the "stability of the financial system".

This post takes a look at the appreciation (or in some cases, depreciation) of home prices in 11 developed markets. New Zealand, Canada and Australia are in a league of their own at the top, while Germany, Ireland and Japan are at the bottom. Where are the U.S. and the U.K.? Read on!

A recent Gallup survey on expected future returns of asset prices shows that most Americans still think that owning a home is the best way to generate a high return in the future. Nothing could be further from the truth! It just shows how totally out of touch with reality the average American is.

Canada’s housing market is the most expensive in the world - 60% overvalued by historical standards - and one simple reason explains it.

The Canadian housing market is headed for a significant bust, in my view. It's going to be a repeat of the 2008 mortgage bubble deflation. Only it's happening to the north. People will lose a lot of money but those who understand and are properly positioned may gain fortunes.

All of this talk about a "bright future" for real estate is just a bunch of nonsense. The yield on 10-year U.S. Treasuries is starting to rise aggressively again and, because mortgage rates tend to follow such increases, mortgage rates are going up. As monthly payments go up less people will be able to afford to buy homes at current prices and this will force home prices down. As such, another great real estate crash is inevitable. Let me explain further. Words: 995 ; Charts: 1

Today, I'm dishing on the unbelievable rebound in residential real estate, pesky rumors about the dollar's demise and a resurgent U.S. stock market. So let's get to it.

If I had to guess, I would say that a majority of people in the country still view the housing market in a negative light. They note: •the still-large overhang of foreclosed properties, •the still-low rate of new housing starts, and •the still-depressed level of housing prices in many parts of the country but that is looking at the market from a static viewpoint. There have been some very important improvements in the housing market over the past 18 months...that have all the makings of a clear turnaround that is underway and likely to continue. [Let me explain.] Words: 388

For the past few months, existing home sales levels have been weaker than expected. The focus, however, should not be on the weakness of the headline numbers. In actuality, the softening in existing home sales is showcasing the potential for acceleration in new home sales. [Let me expain.] Words: 1205

The Canadian ratio of debt to income hit 163.4% in the second quarter, up from 161.7% at the end of last year, according to figures released Monday by Statistics Canada. That’s the highest ratio of debt to income ever recorded in Canada, and more inflated than the levels witnessed in the U.S. and Britain before their housing market collapses in the mid-2000s. Words: 625