Where Are Housing Prices Headed?

Jon Flynn says what we saw in 2021 and 2022 in the real estate market wasn’t normal and that we’re likely heading back to slower, flatter prices. Do you agree?

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Where do you think the market’s going?

Let’s stay in Ontario and BC, and maybe the Calgary area. A lot of people live in those three spots. Where do you think it’s heading over the next six months to a year to two?

Yeah. So again, that’s, an interesting dynamic. Now what I saw, what we saw in the last five years, or leading up to 20 21, 20 22, even, was not normal. This is not normal that prices go up however much, 25% in some cases in certain areas. What’s normal is when you look back to 2008. That was a normal correction leading up to that.

And even after that, like you were lucky to make 3 to 5% a year on real estate. Real estate investing was a, was a job. It wasn’t just take the money from your credit line or from your equity in your GTA home and, uh, speculate on a pre-construction condo or detached in nagger or whatever the case was.

That is not normal. What’s normal is, is hard work and real estate wasn’t attractive to invest in.

Right.

And all of a sudden we got into this mania of real estate investing. And I think the problem with it was social media amplified everything. The internet of course amplified it, but social media really amplified and the message just got around that buy a pre-con and you’re gonna be rich and you can assign it and whatever else.

But we’re headed back. We’re into normal times now where, you know, again, speculating is not normal. So you’re not gonna see people speculating on real estate for a long time. It’s gonna happen again at some point. It always happens. It happens. It happened in the late eighties. The late eighties run up to the early nineties was very similar to now.

And you hear a lot of people talk about that, and I’ve compared it in the past too. So you’re gonna see this slow grind down. We might have some hiccups that might make it worse. We might see some bigger legs down at some point, but we’re already 33% in certain areas in Ontario from the peak it’s gonna be very similar to the nineties. We’re gonna see this slow grind down flat prices. And, when the bottom’s gonna happen. I’ve never called the bottom. I don’t know if we were getting close though, like, to, to talking about the bottom right.

We’re, we’re in that range, but again, the bottom’s not gonna be in 2026. In my opinion, and this is based off of historical numbers and cycles, right?

No, I tend to agree with you, and I think that unfortunately the surprises that can come into analysis are more likely to be negative than positive.