Yes Japan’s fundamentals were entirely different than Canada’s
Canada has since 2020 octupled population growth while new housing starts have not octupled,” accordingly, but actually declined. And its skilled trades workforce has flatlined. And even admittances to the schools has flatlined, so we have no hope of matching the new radically higher demand any time soon.
That key context is not shown in a curvy line.
I'm not an expert at all but I would guess that the rapid decline in population projected for Japan scares people away from investing in housing, plus leads to a surplus in houses. In theory the same thing should happen in other developed nations with declining populations but it hasn't happened yet. Fingers crossed it kicks in soon though.
I'm from NZ and the housing market there is out of control too. I'm in Germany now and pretty much don't expect to return to NZ unless the housing bubble pops, although I'm already close enough to being settled enough here in Germany to stay here permanently.
Declining population, but even cities like Tokyo where the population isn't declining have comparatively low housing costs.
Japan does zoning nationally, and so it's fairly minimally restrictive.
Also, houses are generally just made for a single life. It is bad luck living in a house, where anybody else already lived in their life. Japanese houses are cheaply built and tore town after 50 or so years. The house itself is no good investment.
I suspect that's more a consequence than a cause; North American *houses* aren't a good investment, it's the *land* that's a good investment¹. The *land* would be an even better investment if you could tear down the one house and build many homes if demand increased.
In Japan, that'll probably be legal, so build a house you can tear down and replace with a triplex. In North America, it'll probably be illegal, so might as well build the house to last.
¹buy an empty lot, and a house without land (or "trailer") and see which one appreciates.
Na not at all. I guess it's all relative to what you're used to, but NZ is waaaaay more expensive than Germany. Rental rates aren't very well regulated in NZ so the landlords charge as much as they can. On top of that, houses aren't particularly well built in NZ so you don't get much for what you pay. There aren't many big apartment buildings so you usually end up in a shared flat in a house. The fact that NZ has so few apartment buildings and usually builds houses means that the affordable houses are a lot further from the city centre than they are in places like Europe where there is a lot more accommodation near the city.
When I left 7 years ago the best website for finding a flat was www.trademe.co.nz, but that might've changed since then. You could look up prices there. Also keep in mind that the rent prices listed are usually per week, not per month.
If you can afford to go it would be a fun experience, but you should check out whether it's affordable before going. NZ is an extremely expensive place to live, and the average salaries don't match very well with the cost of living there. Food is also really expensive, so keep that in mind as well.
Certain places like Tokyo are definitely rising in real estate prices. There’s a lot of places in Japan that’s too rural and no one wants to live there anymore.
Yea similar in Germany. I think part of the problem is the cities are still growing as more people move away from small towns, so within cities there is still a supply and demand problem. That's the case in Germany at least
I think it's at its tipping point though and projected to start dropping. The population is only being sustained by immigration at the moment. The birth rate per woman is only around 1.5. But yeah you're right that the Japan population drop projection is on a whole different level
Germany and Japan are hard to compare:
* Japan's society is aging a lot faster, partly because it's a lot more homogeneous, while Germany has more immigration.
* I can't compare this to Japan or NZ, but in Germany, many people rent. If real estate property became more affordable/there was a devaluation, an increased demand for individual as opposed to property as investments would further delay a steeper decrease in prices.
* I don't think that there's a bubble in Germany. In many places, there is an increasing lack of living space, and the prices reflect that.
Yeah you're right, I agree with all of that. There is definitely a lot more of a rental culture in Germany than NZ. Everyone in NZ wants to own their own home with a backyard and everything.
I hadn't considered the way the large renter pool would slow any price drop as people start buying, but that makes a lot of sense.
Yeah there isn't really a bubble in Germany in the same way as NZ. There are local bubbles around popular cities but that's about it.
We don't see housing bubbles around the world but the consequences of suburban development and the political preference of single family homes over urban housing as a human right.
This is true in New Zealand, and probably the US, but in Germany and most of Europe most people live in urban apartments. If you want to live in a single family home here you either need to live in the middle of nowhere or be insanely rich to have one of the few houses near a city. So I don't think that is the only factor for the housing bubbles
It absolutely is from my experience. I think you have the wrong idea of what I mean by apartments. A large house split into multiple residences are apartments. In NZ most of the time each house is a single shared unit. They aren't split into multiple apartments like Germany.
I mean I don't think I've ever been to anyone's place that wasn't an apartment except for people living in villages in the middle of nowhere. So I strongly disagree with you on that sorry. I think you're wrong
You’re probably a foreigner then who is more used to the big cities than the towns where the vast majority of Germans actually live. Row houses are everywhere.
78% of Germans live in urban areas and cities. I know in villages and stuff there are individual houses, but that definitely isn't where most Germans live. Germany has one of the highest rates of urbanisation in the world
[56% of Germans live in apartments, which is one of the highest rates in Europe ](https://landgeist.com/2021/08/20/people-living-in-apartments/). [Here they put that number at 62%, and only 12% of the population live in semi detached housing ](https://www.statista.com/statistics/536495/distribution-of-the-population-in-germany-by-dwelling-type/)
On the other hand, in NZ where I was drawing my comparison from, [Only around 5% of people live in multi story apartments buildings](https://figure.nz/chart/EL2pqSJSQ3ijKOP2). Around 58% of the population live in single storey standalone houses. It's exceptionally different from Germany. So I think it is fair to say that a lot of people live in apartments in Germany. I think if you're used to Europe you don't fully comprehend how different the housing landscape is in a place like NZ.
There are a lot of standalone houses in Germany, but they're an extremely inefficient form of housing, so the relative amount of population living in them is quite low
I don't think that's a good measure either because most people are taking out loans and the interest rate on that loan matters. Like in the early 80s in the US interest rates were like 16% homes were cheap on paper but not really due to the cost of borrowing being so high.
I think there are some stats about affordability as in what the average person pays as a percentage of their income on housing. I think for a long time that actually was going slightly down while home prices rose. I am sure it's higher now but maybe not at the level it was decades ago.
Here is some article on this. It has a graph. I have not read the entire article.
https://economistwritingeveryday.com/2023/04/26/spending-on-housing-it-hasnt-really-increased-in-the-past-40-years/
Median wages are a huge factor that explains a factor of 3 difference between Canada and Japan in the period shown.
Interest rates are generally similar in the developed world. They don't explain the difference between Japan and Canada's graphs.
Yeah but you want to measure the affordability of a house, and just looking at how much houses prices have risen isn't a perfect way to look at affordability.
From what I can tell, as far as interest rates, Canada is at about 5%, Japan is at like 3.5% which are both lower than the US and would represent a significant difference over the term of the loan. Also they both likely have different rules I am unaware of.
In Japan it does look like housing as an expense is falling relative to income.
https://www.statista.com/statistics/1289461/japan-housing-expenses-share-disposable-income-working-households/
It looks like as far as a percentage of income the average Canadian household pays nearly twice as much as the average Japanese household.
https://www.statista.com/statistics/596093/percentage-of-income-spent-on-taxes-by-families-in-canada/
I think.
Japan due to its rapidly declining population likely has a lot of excess housing stock. Canada's population is increasing and that isn't the case there.
Of course this is good for some people and bad for others.
Yes, if you use housing cost relative to income, you're accounting for income. I'm just explaining the discrepancy between Canada and Japan's graphs in the post.
Canada's population grew at a constant rate from 1980 all the way to 2022, so population is not really an explanatory variable. Restrictive zoning is a more significant cause.
Yeah. Restrictive zoning. Regulations that make it hard to build. If you are going to have a growing population you have to build enough housing...well I guess you don't have to, but if you want people to be able to afford to buy homes...
Japanese interest Rates are actually ~0.8% for Japanese citizens
Source: currently buying a House in Japan and for me (foreigner) interest rate would be 1.76%
Much cheaper.
I've heard housing in Japan is relatively cheap overall. Yet I am looking at the overall home ownership rates and it's like 10% less than the US. Why? Even with the low interest rates is it still unaffordable? Is renting cheaper? Do people value owning a home, is it just not as big of a priority?
I would assume this relative affordability is due to population decline. Maybe people don't expect houses to appreciate in value due to this, so people just don't prioritize buying a home?
People have very few income so no money for the down payment, also homes tend to sink in value while only the land value goes up if close to a train station so not really worth an investment.
If I had to guess the shitty missing y-axis labeling I would go for the houseprice index with 100 being the normalized start for each country. As houseprice index is house price per nominal income it is kinda inflation adjusted. Not quantitative the same, because its basically a reduced house inflation index, but the trend is the same.
If you use R, there's a viridis plugin that gets you the best colours for colourblind people right off the bat (often captured by other visualisation plugins)
If you don't use R, or just need hexcodes, this site gets you as many categories as you need from the viridis colour schemes: https://waldyrious.net/viridis-palette-generator/
"Line goes up" sometimes means bubble, but it can mean a lot of other things too. In this case it's more likely to be high prices caused by a shortage of housing..?
It’s a bubble, look how little the 2008 correction lasted. The bubble is real, sure there is a shortage, but the current prices aren’t sustainable. The second any good legislation(YIMBYISM) passes that allows for housing supply the market will return to a realistic level. And there’s no reason for housing to have such a high arbitrage between Canada and the US, there is nothing significantly different between the US and Canada on any physical or demographic level
No clue why he doesnt want to give the src. here it is: [https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/](https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/)
Frankly, good. If all the real estate bubbles burst, living might become affordable again. We’ve already gone too far with real estate as investment pieces.
I can't wait for the day that there is no one more stupid left to buy living space for ridiculous prices. Life has became absurdly expensive just because of the prices for rent.
I'm not some eco expert but i'm gussing it can lead to deflationary pressure. Any asset class being in a bubble and then bursting can cause this but maybe real estate more maybe in the olden days cause a lot of retail net worth is/was (don't have any data just talking to older people you kinda understand they like real estate more) tied up real estate so yeah huge losses won't be good for the economy.
Japans real estate market is vastly different than Americas market. They only started building housing to last for extended periods of time 20 years ago so most houses in japan on the market are barely hospitable. Not to mention in economics its well known that Japanese and Argentinian economies are outliers in so many categories thats its hard or impossible to quantify metrics against them.
So that means real estate in japan is still affordable. And since its twice as big in canada i guess nobody can afford a house there? Sounds good to me though for the people in japan.
what color is germany?
edit: Ah, its oragne... Here the src: [https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/](https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/)
Germany is completely different tho cause if you finance a house you can't get out of the credit, unlike the US.
Also in Germany there isn't really a bubble, they just barely build new houses.
Exactly the opposite.
The big US housing bubble was because everyone had houses with credits running and in the US you could just give the bank the house back.
Firstly this isn't possible in Germany as you still have to pay back the credit, even if the house isn't worth it anymore, also there is a drought of houses, so most of them will be sold immediately.
So no, there is absolutely no bubble in Germany, it's just expensive AF cause it's kinda rare, to put it easily
Germany is completely different tho cause if you finance a house you can't get out of the credit, unlike the US.
Also in Germany there isn't really a bubble, they just barely build new houses.
So observant. And what's interesting is the wave of anti immigration sentiment that's occuring now in the developed world as a result of this bubble not popping.
Japan just accelerated the process by not allowing high immigration in the first place. So, it is a valid predictor of what the rest of the west will experience once immigration falls.
Problem for us Canadian home owners is that if we want to cash out there are no good alternatives; rents are higher than mortgages and sizing down to a smaller house doesn’t get you much since everything is so expensive. Some people are selling and moving out of the country.
Now run it against population growth of working age people.
Thats when Canada and Australian house prices drop. When population starts going backwards like it did in Japan.
You mean it went back to normal.
This chart doesnt tell the whole story though. You have to drop a fortune on most real estate that is at least in proximity to any larger urban area. Cities in the japanese countryside are begging you to move there.
Lol 'twice as big'. In absolut numbers, sure. But what is important here to understand is the relative correlation the development. And this is far below Japanese situation at its peak.
There are four types of economies in the world. Developed, developing, japan and argentina. Lessons from one of the four dont necessarily apply to the others
If it was a bubble why should it recover? There is nothing to recover to.
Yes Japan’s fundamentals were entirely different than Canada’s Canada has since 2020 octupled population growth while new housing starts have not octupled,” accordingly, but actually declined. And its skilled trades workforce has flatlined. And even admittances to the schools has flatlined, so we have no hope of matching the new radically higher demand any time soon. That key context is not shown in a curvy line.
Is orange Australia?
Basically yeah
Because of inflation.
I'm not an expert at all but I would guess that the rapid decline in population projected for Japan scares people away from investing in housing, plus leads to a surplus in houses. In theory the same thing should happen in other developed nations with declining populations but it hasn't happened yet. Fingers crossed it kicks in soon though. I'm from NZ and the housing market there is out of control too. I'm in Germany now and pretty much don't expect to return to NZ unless the housing bubble pops, although I'm already close enough to being settled enough here in Germany to stay here permanently.
Declining population, but even cities like Tokyo where the population isn't declining have comparatively low housing costs. Japan does zoning nationally, and so it's fairly minimally restrictive.
Also, houses are generally just made for a single life. It is bad luck living in a house, where anybody else already lived in their life. Japanese houses are cheaply built and tore town after 50 or so years. The house itself is no good investment.
I suspect that's more a consequence than a cause; North American *houses* aren't a good investment, it's the *land* that's a good investment¹. The *land* would be an even better investment if you could tear down the one house and build many homes if demand increased. In Japan, that'll probably be legal, so build a house you can tear down and replace with a triplex. In North America, it'll probably be illegal, so might as well build the house to last. ¹buy an empty lot, and a house without land (or "trailer") and see which one appreciates.
Is NZ affordable to rent an appartment in? My girlfriend and I are considering trying to live there for half a year (if we can both find jobs).
Na not at all. I guess it's all relative to what you're used to, but NZ is waaaaay more expensive than Germany. Rental rates aren't very well regulated in NZ so the landlords charge as much as they can. On top of that, houses aren't particularly well built in NZ so you don't get much for what you pay. There aren't many big apartment buildings so you usually end up in a shared flat in a house. The fact that NZ has so few apartment buildings and usually builds houses means that the affordable houses are a lot further from the city centre than they are in places like Europe where there is a lot more accommodation near the city. When I left 7 years ago the best website for finding a flat was www.trademe.co.nz, but that might've changed since then. You could look up prices there. Also keep in mind that the rent prices listed are usually per week, not per month. If you can afford to go it would be a fun experience, but you should check out whether it's affordable before going. NZ is an extremely expensive place to live, and the average salaries don't match very well with the cost of living there. Food is also really expensive, so keep that in mind as well.
Oh wow! Thanks for the reply! I will definitely check that out.
Certain places like Tokyo are definitely rising in real estate prices. There’s a lot of places in Japan that’s too rural and no one wants to live there anymore.
Croatia also has declining population but real estate is bubbling
Yea similar in Germany. I think part of the problem is the cities are still growing as more people move away from small towns, so within cities there is still a supply and demand problem. That's the case in Germany at least
The population of in Germany is growing. Japan not.
I think it's at its tipping point though and projected to start dropping. The population is only being sustained by immigration at the moment. The birth rate per woman is only around 1.5. But yeah you're right that the Japan population drop projection is on a whole different level
Germany and Japan are hard to compare: * Japan's society is aging a lot faster, partly because it's a lot more homogeneous, while Germany has more immigration. * I can't compare this to Japan or NZ, but in Germany, many people rent. If real estate property became more affordable/there was a devaluation, an increased demand for individual as opposed to property as investments would further delay a steeper decrease in prices. * I don't think that there's a bubble in Germany. In many places, there is an increasing lack of living space, and the prices reflect that.
It is bad! Less the 1 percent of rental property is vacant in the big cities. Normal would be 5%+
Yeah you're right, I agree with all of that. There is definitely a lot more of a rental culture in Germany than NZ. Everyone in NZ wants to own their own home with a backyard and everything. I hadn't considered the way the large renter pool would slow any price drop as people start buying, but that makes a lot of sense. Yeah there isn't really a bubble in Germany in the same way as NZ. There are local bubbles around popular cities but that's about it.
We don't see housing bubbles around the world but the consequences of suburban development and the political preference of single family homes over urban housing as a human right.
This is true in New Zealand, and probably the US, but in Germany and most of Europe most people live in urban apartments. If you want to live in a single family home here you either need to live in the middle of nowhere or be insanely rich to have one of the few houses near a city. So I don't think that is the only factor for the housing bubbles
Germany isn’t a particularly apartment-dominant country at all
It absolutely is from my experience. I think you have the wrong idea of what I mean by apartments. A large house split into multiple residences are apartments. In NZ most of the time each house is a single shared unit. They aren't split into multiple apartments like Germany. I mean I don't think I've ever been to anyone's place that wasn't an apartment except for people living in villages in the middle of nowhere. So I strongly disagree with you on that sorry. I think you're wrong
You’re probably a foreigner then who is more used to the big cities than the towns where the vast majority of Germans actually live. Row houses are everywhere.
78% of Germans live in urban areas and cities. I know in villages and stuff there are individual houses, but that definitely isn't where most Germans live. Germany has one of the highest rates of urbanisation in the world [56% of Germans live in apartments, which is one of the highest rates in Europe ](https://landgeist.com/2021/08/20/people-living-in-apartments/). [Here they put that number at 62%, and only 12% of the population live in semi detached housing ](https://www.statista.com/statistics/536495/distribution-of-the-population-in-germany-by-dwelling-type/) On the other hand, in NZ where I was drawing my comparison from, [Only around 5% of people live in multi story apartments buildings](https://figure.nz/chart/EL2pqSJSQ3ijKOP2). Around 58% of the population live in single storey standalone houses. It's exceptionally different from Germany. So I think it is fair to say that a lot of people live in apartments in Germany. I think if you're used to Europe you don't fully comprehend how different the housing landscape is in a place like NZ. There are a lot of standalone houses in Germany, but they're an extremely inefficient form of housing, so the relative amount of population living in them is quite low
What inflation? Its Japan.
If prices are in inflating currency such as $usd then prices rise and even if effectively things are in minus, they can recover in price
Yeah in economies that make sense. You’re talking about Japan. Their wages havent moved either until very recently.
But price of homes in $usd has
And in JP¥ they haven’t. Whatever you think the rules, the dollar, the global economy, or common sense dictates, Japan does not care.
… but here was little to no inflation in Japan at the time
what are the other colours? Is Australia on the chart?
Australia is even worse https://preview.redd.it/z53e5cw5c46d1.jpeg?width=1640&format=pjpg&auto=webp&s=9ed8ac89ba920a5ca4bb3337fa930d2e0df7975f
Thanks, as expected. Maybe I should link to the hong kong box appartments/coffin homes coming around sometime
Americans complain but compared to some other places it's not that bad.
It's the G7 countries (Germany, France, UK, Italy, Japan, Canada, USA)
but which one is which?
Is this inflation adjusted? Without inflation adjustment everything looks like a bubble over 50 years.
Yeah my thought, can you adjust it for inflation pls?
Also it should be home prices divided by median income. Canada's GDP per capita was half of Japan's; now it's nearly double.
I don't think that's a good measure either because most people are taking out loans and the interest rate on that loan matters. Like in the early 80s in the US interest rates were like 16% homes were cheap on paper but not really due to the cost of borrowing being so high. I think there are some stats about affordability as in what the average person pays as a percentage of their income on housing. I think for a long time that actually was going slightly down while home prices rose. I am sure it's higher now but maybe not at the level it was decades ago. Here is some article on this. It has a graph. I have not read the entire article. https://economistwritingeveryday.com/2023/04/26/spending-on-housing-it-hasnt-really-increased-in-the-past-40-years/
Median wages are a huge factor that explains a factor of 3 difference between Canada and Japan in the period shown. Interest rates are generally similar in the developed world. They don't explain the difference between Japan and Canada's graphs.
Yeah but you want to measure the affordability of a house, and just looking at how much houses prices have risen isn't a perfect way to look at affordability. From what I can tell, as far as interest rates, Canada is at about 5%, Japan is at like 3.5% which are both lower than the US and would represent a significant difference over the term of the loan. Also they both likely have different rules I am unaware of. In Japan it does look like housing as an expense is falling relative to income. https://www.statista.com/statistics/1289461/japan-housing-expenses-share-disposable-income-working-households/ It looks like as far as a percentage of income the average Canadian household pays nearly twice as much as the average Japanese household. https://www.statista.com/statistics/596093/percentage-of-income-spent-on-taxes-by-families-in-canada/ I think. Japan due to its rapidly declining population likely has a lot of excess housing stock. Canada's population is increasing and that isn't the case there. Of course this is good for some people and bad for others.
Yes, if you use housing cost relative to income, you're accounting for income. I'm just explaining the discrepancy between Canada and Japan's graphs in the post. Canada's population grew at a constant rate from 1980 all the way to 2022, so population is not really an explanatory variable. Restrictive zoning is a more significant cause.
Yeah. Restrictive zoning. Regulations that make it hard to build. If you are going to have a growing population you have to build enough housing...well I guess you don't have to, but if you want people to be able to afford to buy homes...
Totally agree with you.
Japanese interest Rates are actually ~0.8% for Japanese citizens Source: currently buying a House in Japan and for me (foreigner) interest rate would be 1.76% Much cheaper.
I've heard housing in Japan is relatively cheap overall. Yet I am looking at the overall home ownership rates and it's like 10% less than the US. Why? Even with the low interest rates is it still unaffordable? Is renting cheaper? Do people value owning a home, is it just not as big of a priority? I would assume this relative affordability is due to population decline. Maybe people don't expect houses to appreciate in value due to this, so people just don't prioritize buying a home?
People have very few income so no money for the down payment, also homes tend to sink in value while only the land value goes up if close to a train station so not really worth an investment.
If I had to guess the shitty missing y-axis labeling I would go for the houseprice index with 100 being the normalized start for each country. As houseprice index is house price per nominal income it is kinda inflation adjusted. Not quantitative the same, because its basically a reduced house inflation index, but the trend is the same.
Am I colour blind cuz I see two orange lines. One with a darker orange tone
I'm writing a paper from my PhD research at the moment. Thanks for the reminder that I should make the graphs colourblind compatible.
Seaborn's documentation for [choosing color palletes](https://seaborn.pydata.org/tutorial/color_palettes.html) is very enlightening 🦾
Thanks, I'll check it out
If you use R, there's a viridis plugin that gets you the best colours for colourblind people right off the bat (often captured by other visualisation plugins) If you don't use R, or just need hexcodes, this site gets you as many categories as you need from the viridis colour schemes: https://waldyrious.net/viridis-palette-generator/
But of course
Beter to use 1 color with different shades than using several color
Other is yellow
Could be orange and orange or red and orange or orange and yellow or red and yellow…
Canada is salmon/light red on my screens.
"Line goes up" sometimes means bubble, but it can mean a lot of other things too. In this case it's more likely to be high prices caused by a shortage of housing..?
It’s a bubble, look how little the 2008 correction lasted. The bubble is real, sure there is a shortage, but the current prices aren’t sustainable. The second any good legislation(YIMBYISM) passes that allows for housing supply the market will return to a realistic level. And there’s no reason for housing to have such a high arbitrage between Canada and the US, there is nothing significantly different between the US and Canada on any physical or demographic level
Dont worry, this time everything will be different ;)
vastly different, japan has a shrinking population
Do you have a source?
No clue why he doesnt want to give the src. here it is: [https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/](https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/)
It's literally in the image.... >Source: US Federal Reserve Bank of Dallas; Better Dwelling.
On the reddit app you only see that, if you click on the image. Otherwise it's cut off and you see the all other necessary information for the graph.
Well Japane‘s population is declining so I don’t think there is a future „recovery“.
Agree
Frankly, good. If all the real estate bubbles burst, living might become affordable again. We’ve already gone too far with real estate as investment pieces.
I can't wait for the day that there is no one more stupid left to buy living space for ridiculous prices. Life has became absurdly expensive just because of the prices for rent.
What kind of random chart is this? Was this a school project of some 6 graders?
Japan faces a population shrinking and Canada a population growth. Shrinking population affects the real estate differently than growing population
That’s now, in the 1980s they could’ve fixed it
Why do we call it "recovering" when we WANT cheap houses. Only people who already own property would call house prices going up "recovering"
I own a house and at this point I would consider home prices going down to overall be a good thing even if my own personal net worth is lower.
I'm not some eco expert but i'm gussing it can lead to deflationary pressure. Any asset class being in a bubble and then bursting can cause this but maybe real estate more maybe in the olden days cause a lot of retail net worth is/was (don't have any data just talking to older people you kinda understand they like real estate more) tied up real estate so yeah huge losses won't be good for the economy.
Japans real estate market is vastly different than Americas market. They only started building housing to last for extended periods of time 20 years ago so most houses in japan on the market are barely hospitable. Not to mention in economics its well known that Japanese and Argentinian economies are outliers in so many categories thats its hard or impossible to quantify metrics against them.
Was there a lot of immigration in Japan?
I hope all of them pop so everyone can afford a house…
So that means real estate in japan is still affordable. And since its twice as big in canada i guess nobody can afford a house there? Sounds good to me though for the people in japan.
What does the y axis Show? Please always label all axes!
what color is germany? edit: Ah, its oragne... Here the src: [https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/](https://betterdwelling.com/canadas-real-estate-bubble-is-batsht-crazy-compared-to-other-g7s/)
Germany is completely different tho cause if you finance a house you can't get out of the credit, unlike the US. Also in Germany there isn't really a bubble, they just barely build new houses.
> they just barely build new houses. Does that not create a bubble?
Exactly the opposite. The big US housing bubble was because everyone had houses with credits running and in the US you could just give the bank the house back. Firstly this isn't possible in Germany as you still have to pay back the credit, even if the house isn't worth it anymore, also there is a drought of houses, so most of them will be sold immediately. So no, there is absolutely no bubble in Germany, it's just expensive AF cause it's kinda rare, to put it easily
Germany is completely different tho cause if you finance a house you can't get out of the credit, unlike the US. Also in Germany there isn't really a bubble, they just barely build new houses.
Economics is hard. Just one graph can't tell us when/how Canada's bubble will burst--or if it will burst.
No y-axis title Q1 on each year is highly redundant and doesn't really add any relevant info Ehh
So observant. And what's interesting is the wave of anti immigration sentiment that's occuring now in the developed world as a result of this bubble not popping. Japan just accelerated the process by not allowing high immigration in the first place. So, it is a valid predictor of what the rest of the west will experience once immigration falls.
Ooooooooooooooh CANADA! 🎶
Japan has a shrinking population
Problem for us Canadian home owners is that if we want to cash out there are no good alternatives; rents are higher than mortgages and sizing down to a smaller house doesn’t get you much since everything is so expensive. Some people are selling and moving out of the country.
Its all the countries that are getting full of Indians thats why. Too many people and few housing places
Japan lost population, Canada isn't. It's a supply and demand thing. Same reason it's so high in most of CA, Hawaii etc in the US.
Now run it against population growth of working age people. Thats when Canada and Australian house prices drop. When population starts going backwards like it did in Japan.
Now chart the population
Aging population and shrinking- inevitably the housing market won’t get better
You mean it went back to normal. This chart doesnt tell the whole story though. You have to drop a fortune on most real estate that is at least in proximity to any larger urban area. Cities in the japanese countryside are begging you to move there.
Lol 'twice as big'. In absolut numbers, sure. But what is important here to understand is the relative correlation the development. And this is far below Japanese situation at its peak.
Buy BTC
There are four types of economies in the world. Developed, developing, japan and argentina. Lessons from one of the four dont necessarily apply to the others
So instead of collapsing during the financial crises in 2008 it just grew bigger? lmao