Media revisionists are now saying that the Toronto housing bubble burst in the spring of 2017. However, when Stockhouse wrote on June 30, 2017 “Toronto Housing Bubble Teetering Dangerously”, we were one of the very first media outlets to take an unequivocal stand on this subject.

Even on into the summer, as Stockhouse published follow-up articles on this subject, this was still no consensus in the mainstream media. By 2018, however, apologists for Toronto’s housing bubble have had to throw in the towel. Recent media reports highlight the carnage from this burst bubble – in its very early stages.

'Reckless' Toronto housing market cost sellers $135M over 135 days: report

The $135 million in defined losses are just from the first five months of this implosion, and only reflect some of the losses over that period of time. Yet the same article shows the pathetically delusional nature of media pundits and “market experts”. The clear message is that the worst is over.

The future looks far less volatile for buyers and sellers in the GTA, with the condo market being the final meaningful pocket of risk, according to Pasalis. In the near term, he’s calling for neither a continued correction, nor a return to the break-neck price increases that defined so much of 2017.

“We’ve kind of pricked this bubble,” Pasalis told CTVNews.ca. “For this year, it looks like things are going to be pretty stable. It’s possible you might see price declines going forward in the future, but something else has to happen.” [emphasis mine]

“The final meaningful pocket of risk”? Such messages are infantile and reflect profound ignorance concerning economics in general, and housing bubbles in particular. Why is the Toronto real estate market – and the Vancouver real estate market – an obvious asset bubble, along with hundreds of other cities across the Western world?

As has been explained to readers in previous articles on this subject, the real estate equation is a simple one. Over the long term, housing prices must remain parallel to income levels. Period. No exceptions, ever.

The reason is simple. We pay for our mortgages out of our wages. For housing prices to rise – sustainably – wages must rise in equal proportions. This has not happened. In Toronto and Vancouver, housing prices detached from incomes roughly two decades ago, and the gulf between these two trends has increased enormously over those many years.

Wages have been flat. House prices (especially in recent years) have gone straight up in Toronto and Vancouver. Balance must be restored. Wages will never go up. This means real estate prices will go lower – and lower and lower.

Housing bubbles built up over decades don’t evaporate in months. They implode over a span of years, and the real carnage has not even begun in Toronto’s housing market.

Extended low interest rates always cause housing/real estate bubbles, and every central banker knows this. In 2008; these rapacious money-printers took Western interest rates to the lowest level in history – and just left them there, permanently. These housing bubbles were deliberately manufactured by Western central banks. Meanwhile, Western governments have done nothing but watch, until it was already too late to prevent the damage.

No other government in the history of any Western nation has engaged in such monetary recklessness, even briefly. The only other regime to have ever embarked upon such monetary insanity is Japan. You remember Japan? This is the once-prosperous economic power that has been mired in a 30+ year depression.

For 20 of those years; the mantra from Western central banks was universal and unequivocal: “we would never copy Japan.” Then they did precisely that – except to an even more insane degree with their “quantitative easing”.

The Western economic depression is now 10 years old, partially concealed by the housing bubbles created by Western central banks. Those are the facts, yet readers would be hard-pressed to find any such reporting of reality from any mainstream media outlet.

The collapse of the Toronto housing bubble has just begun. While the Vancouver housing bubble has yet to implode in any meaningful way, such a collapse is both inevitable and imminent.

Stockhouse readers need to be wary of the media Revisionism to which we are now constantly exposed.

1. Pretend that no Toronto housing bubble existed, even when nothing could be more obvious.
2. Pretend that the bubble hadn’t started to collapse, even when the evidence of such a collapse was undeniable.
3. Pretend that these same market cheerleaders had acknowledged the bubble and the collapse all along, when nothing could be further from the truth.
4. Pretend that the collapse is over when it has barely even begun.

Some would have an even uglier term for such media Revisionism: propaganda machine.

The Toronto housing bubble and the Vancouver housing bubble and all the other housing bubbles across the Western world will implode because they must implode. Media cheerleading and the forecasts of intellectually bankrupt “experts” cannot alter the simple arithmetic that is involved here – and undo the monetary crimes of Western central banks.