We know you’re busy. You’re also smart, and curious about the real estate market. So here’s the TL;DR version of the most important insights in real estate this week.
Tracking global capital flows in Asia produced some interesting insights.
Flood Of Foreign Buyers In March? Nope. China’s FX Reserves Rise Again
The FOMO is real. China’s new capital controls put in place in January has stopped the Mainland Chinese buying spree, and analyzing global foreign exchange reserves definitely supports that. China is now seeing capital inflows, instead of outflows in 2017. Although it’s cute to hear people think they beat super rich investors at a bidding war by maxing out their credit. Read the full story.
Even North Korea Is Experiencing A Real Estate Bubble
Global real estate speculation is leaving no part of the world untouched, as people start using property as lottery tickets. Even North Korea, where private property ownership is illegal, and the median annual income is only US$36 dollars, we saw prices climb in line with tier 2 financial capitals like Toronto, and Vancouver. In case you’re curious, they all dwarfs tier 1 cities like New York, and London. Read the full story.
North Korea’s state media announces a tower in Pyongyang was built at a story per day.
A look at how effective the foreign buyer tax was (or wasn’t), and analyzing population growth.
Vancouver’s Foreign Buyer Tax Didn’t Stop Real Estate Sales, China Did
The foreign buyer tax is being sold politically as extremely effective, however the large drop now looks more like a market “squeeze” event. Shortly after that, foreign buying continued to increase right up until January, when China passed new rules preventing the exchange of capital for real estate. That’s right around when sales started to taper. Read the full story.
Analyzing Vancouver Real Estate And Population Growth
We dropped an intro on analyzing buying and selling potential market size in Vancouver. Using the province’s projections, the potential pool of first-time homebuyers vastly outpaces the pool of last-time sellers. This number is slated to flip in the future, but not nearly as much as cities like Toronto. Read the full story.
Buyers pile into the market in March and a look at the relationship between rents and real estate prices.
Toronto Real Estate Prices Go Parabolic In March
Despite every major bank in the country calling Toronto’s real estate market overheated, buyers kept piling in. In March, all but one neighbourhood saw prices rise more than 15%, an increase that’s more than 3x that of cities like New York or San Francisco. Read the full story.
The Inverse Relationship Between Toronto Real Estate And Rents
We analyzed over 20 years of real estate prices, and rents. What we found is historically rents rise when real estate prices are weak, and real estate prices are weak when rents rise. With anecdotal evidence that rents are rising in Toronto, what does that mean for real estate prices? Read the full story.