I may agree that Canada is in a bubble - I need some more data.
Just curious - if I buy an average home or condo in Canada what is the unlevered cap rate for the owner?
This should basically be rent minus taxes, home insurance, maintenance, hoa fees if any and other misc. I would exclude leasing fees, vacancy, utilities (pd by owner I assume if he rented it to a tenant). For maintenance I would assume $1 a SFT for a home which is probably roughly right.
This helps me quantify the unlevered return (excluding appreciation/depreciation) of buying a home.
For example - in Southern California the cap rate for average places went to ~2% in 2006. That is a P/E of 50 unlevered and makes no fundamental sense.
My area in Texas is ~ 5% 15k on 300k home which is nothing great but not so horrible either.
Thank You