The Housing Boom That Never Ends Already Wiped Out All the Short-Sellers

In December, Aaron Moore bought an unremarkable three-bedroom house in the Toronto suburb of Brampton and, after throwing on a fresh coat of paint and laying down new hardwood floors, put it right back on the market.

In March, he found a buyer. The price tag: C$810,000 (about $649,000), a stunning 28% more than he had just paid.

Normally this kind of quick-buck speculation would be interpreted by economists, policy makers and finance types as the indisputable sign of a housing bubble. But Moore has been a professional house flipper in the Toronto area for more than a decade now, during which a seemingly endless line of illustrious doomsayers have taken the other side of his bet on real estate in word and deed, only to be proven wrong.

One of the earliest was Mark Carney, then Canada’s central bank governor but soon to take over the Bank of England, who called the country’s reliance on housing wealth “ unsustainable” back in 2012. Then came the wave of American financiers, one after the other, whose collective bet on a Canadian housing crash got its own nickname, “The Great White Short.” Many of them, like Steve Eisman of The Big Short fame, applied the lessons they had learned in the bursting of the U.S. housing bubble years earlier.

When Covid-19 hit, even Canada’s own national housing agency seemed sure this was finally the end, predicting a dive in home values ranging from bad to catastrophic. But instead the market went on to another record year, even surpassing the gains in the red-hot U.S. market, and the housing agency’s leader had to take to Twitter to say they’d gotten it wrong, shortly before being replaced.

Through it all, Aaron Moore just kept on buying and flipping.