Episode 244 of the Toronto Real Estate Musing daily video blog.
Are real estate markets local, or national? In George O’Neill’s opinion, residential real estate is local because of all the personal decisions at play. For example, prospective homebuyers make decisions based on the geographic proximity to good local schools, churches, restaurants, libraries, post offices and recreational areas such as pools, playgrounds and parks.
Of course, it’s important that buyers don’t overpay and choose a home they can afford -- however a home is more than just a line on a TREB MarketWatch graph.
In my experience, homes are often not viewed exclusively or even primarily as an investment, but as a place to raise one’s families and match one’s lifestyle.
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I understand that most people look at res real estate from a local level. However, don’t national and international markets and issues influence how people purchase real estate?
Interest rates are national? Maybe I’m wrong, but is there a Toronto interest rate? Maybe a Beaches interest rate?
i’m not being silly here George. I’m just saying that when we hear of slowdowns in the economy, it affects everyone. When interest rates increase, it affects us all. When taxes are increased it affects everyone (provincially and/or nationally)
And these all have a bearing on housing affordability.
Thoughts?
Those are valid observations and questions. But, if one looks at the sales trends in the Beach, say compared to overall Toronto or another city like Calgary, the markets will not necessarily mirror each other. What some people do is generalize widely and say oh the overall market across Canada is down, so therefore every market must be down. This seems to be Garth Turner’s view, who is recommending selling real estate because of a coming crash. Who knows, he may be right but he has been saying that since 2007, so someday I suppose it will come true. I just do not believe it is anytime soon.
People buy residential real estate for many reasons beyond just price, which is of course important. Some of those reasons I outlined in this vlog.
That is what I mean by all real estate markets are local.
George