A Canadian ORAL history of housing MARKET ANXIETIES familiar and PECULIAR
Harry Bierbrier says he needed a little help before he could jump into the pricey housing market. “My in- laws put the down payment on the house,” says the Montreal pharmacist. The mortgage left him “slaving to beat the payments.” Sound familiar? It might. But Bierbrier’s house cost $30,000, and it was 1952. He says, “I don’t think it’s any different today.”
At least one thing is: Homeowners such as Bierbrier who have been around for a while have seen housing prices rise — and fall. To many younger homeowners today, it surely seems like house prices only go one way. Never down.
Prices have ticked up every year since 1998 (except during the 2008 recession, when they dropped briefly and only barely). Not adjusting for inflation, national housing prices have climbed from an average of $ 152,380 then to $ 442,264 now — an almost 200- per- cent gain. No wonder almost everyone wants in, and about 70% of Canadian households are already there.
Yet we seem to forget that Canadian housing markets have seen a number of booms and busts since the Second World War, with each cycle carrying important lessons for homebuyers and homeowners today. To learn from them, the Financial Post spoke to Canadians across the country about what it was like to live in housing markets that were in some ways very different, and
some ways strikingly similar, to what we face now.
That incredible shrinking condo? It’s not all that different than the postwar rise of the 800-square-foot bungalow. The “bank of mom and dad” helping to finance out- of- reach down payments? We met a 92- year- old plant manager who leaned on his parents and his in- laws to get into Toronto’s 1947 market. And today’s march of young buyers to the suburbs happened before, in the 1950s. “There was just an enormous number of baby boomers,” says Doug Norris, chief demographer at Environics Analytics. “There wasn’t just much available housing in the city.”
What we also don’t seem to have — for now, anyway — is the kind of busts that came in 1957, where over six years, prices fell 15 per cent in real dollars. Or in the early ’ 90s, when Toronto houses lost 25 per cent. Or the Quebec separation crisis, when fleeing anglophones dumped the Montreal housing market. Or the National Energy Program ( NEP), when desperate Albertans had no choice but to just walk away from their underwater mortgages.
Another crisis doesn’t seem all that unthinkable. “As I get older, I tend to think this is all just repeating itself,” says John Miron, a University of Toronto professor and author of Housing In Post War Canada. But even he wonders if the world of real estate hasn’t changed for good.
“Is it really the case? I’m not really sure anymore.”