Like mama always told me, when you make the news in Bangor, you’re done. So there it was Tuesday in Maine’s biggest paper: ‘Risk of Canadian housing bubble seen growing.’ And under the fat picture of a construction site, this cutline: “Construction workers labor last summer near the foundation of a condominium project in Toronto. With more skyscrapers and high-rises under construction than any North American city, Toronto may be headed for a U.S.-style correction as prices rise and household borrowing hits a record.”
Now I understand Bangor matters about as much as Bob Rae, but that’s not the point. This is exactly the danger I outlined in recent examples of the rotten press Canadian real estate is getting. If editors at the Bangor Daily News think a housing crash up in the Toronto tundra is interesting enough to publish, then odds are the wire story will percolate its way into many other corners.
This is not good, when even CREA is banking on horny foreigners to keep the market alive through 2012. Canada’s increasingly being painted as an isolated country full of delusionals who must not get CNN. As a result, we’ve pigged out on debt when the rest of the planet is deleveraging. We’ve inflated house prices when real estate’s old news everywhere else. We’re living beyond our means while others are embrace austerity and live small. Mostly, we’re dangerous. Our houses equal risk. Don’t go there.
But, of course, we know otherwise.
Today I drove down a mid-Toronto street running between two north-south arteries. It receives such cross-over volume that city crews have gone nuts with traffic-calming, so too many dogs and kids don’t get flattened. Intersections have been turned into white-knuckled roundabouts and every 500 feet there’s a speed bump large enough to eat a Fiat 500. Working class, most houses are semis or skinny singles sitting on 25-foot lots. Except for those anorexic faux chateaus now infesting neighbourhoods everywhere – stone fronts, fussy facades, windowless sides and deep pretensions.
Ever curious, I punched up the number on the For Sale sign sitting at 327 Broadway Ave. and a realtress with an undress-me voice told me it was $1.695 million. “But we just sold it.”
Accidentally, as I drove the Hummer at a speed just extreme enough to bounce off the top of each bump, I Googled ‘327 Broadway’ on my Berry, and ended up in another dimension. A parallel universe where regular people can actually afford things of beauty, substance and quality, instead of McMansions with stucco-over-foam.
In fact, I ended up being transported to 327 Broadway Avenue in Orlando, Florida. This 1909 heritage home was completely rebuilt four years ago, contains almost 6,000 square feet and makes its Toronto namesake look like your challenged cousin from Amherst. Here’s the listing bumpf:
2007 Aurora Award Winner! First Place Award Winner in HBA’S 2007 Orlando Parade of Homes! PSG Construction was chosen to build the first ever “The Renewed American Home” unveiled during The International Builders Show and The National Association of Home Builders. This historic home was built in 1909 and is located in the Lake Eola Historic District in the urban core of downtown Orlando just steps to Lake Eola. This renewed and expanded home continues to receive international attention and is a “Certified Green Home.” It features a unique vernacular Florida style – a distinctive mix of Victorian, Four-Square Gable and Colonial Revival. This home consists of 5,860 heated sq. ft. showcasing how older homes can be renovated to meet modern lifestyles. This seamless three story renovation features every amenity imaginable with meticulous attention to detail using the newest and finest quality materials available.
In the fall of 2008, this home was listed at $1.2 million, and it’s not hard to see why. But that was then – when Orlando was as hot as North Toronto is now, when bidding wars erupted and houses sold within hours of being listed. Everyone said, ‘it’s different here’ and ‘it’s different this time.’ Mortgages were plentiful and rates were cheap. Everybody wanted to move there. Real estate only went up. Buy now or buy never.
A year ago the sellers had chopped the price to $1 million, then gave up. They walked. About six months ago, 327 Broadway bottomed at $226,000. Today you can pick it up for $497,000. But be careful. As the agent says, “Listing price may not be sufficient to pay the total of all liens and costs of sale, and sale of property at full listing price may require approval of seller’s lender(s), and such approval may be conditioned upon the gross commission being reduced.”
By the way, this house is so cool that the garage has a polished stone floor, complete with stainless steel work benches, cabinets and matching beer fridge. And did I mention the climate?
A tale of two houses, one address, disparate realities. Do we look at Orlando and see the detritus of a failed society, where fools destroyed themselves with excess and irresponsibility? Or is it a window into our future? Are the people who poured time and materials into the Broadway house here so much wiser than those who did the same there? Are the giddy new buyers of the 20-foot-wide palace in the north wiser and more prescient than those who walked away from their dream in the south? Or, in their time, are they all victims of avarice, cheap money and housing hormones?
Waking, I skidded to a stop. Checked the undercarriage for bodies. All clear.
And I got the hell out of there.