The Toronto Housing Market: a Bubble or a Balloon?

More to come?

Many people worry that our housing market will burst. Others say we’ll be fine. This article summarizes both points of view.

Published last week in The Globe and Mail, it depicts a best-case scenario where homes prices will likely end 2012 flat despite an initial slight contraction.

In the worst-case scenario painted by the author, a spike in the unemployment rate and a pullback in credit demand might make the housing market experience a hard landing.

I for one don’t think there is a bubble in our housing market. Bubbles tend to grow quickly before they explode, and they never last long.

The current state of affairs has lasted too long to be called a bubble, although it may merit being called a balloon. If so, I hope it won’t explode, as it’s very inflated right now.

What’s your take? Do you think we should brace ourselves? Or will everything work out fine?

One way or the other, I thank you for reading my blog and wish you a very happy New Year!

1 Comment (+add yours?)

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    Dec 30, 2011 @ 19:39:20

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