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Claeren · 08-25-2008, 01:27 PM

Go back and re-read my posts in this thread -- I have been DEAD ON so far....

Prices are going to keep dropping.

Single Family Homes will bottom out before Condos.

Urban/Established Neighbourhoods will bottom out before Suburban Areas.

Faux Luxury Condos will drop further than well constructed and well priced condos without the faux luxury taglines (OMG GRANITE COUNTERS!? $400,000/500sq-ft IS CHEAP!).

Faux Luxury '$475,000-$650,000 McMansions' will drop a lot more than established older homes and/or entry level homes.

The elimination of zero down and 40 year mortgages, along with general tightening of lending practices, is going to take another 5%+ off prices (up to 20%?).

Higher interest rates in 2009 and 2010 will take another 5%+ off pricing OR higher inflation will wipe away 5%-15%/year in home value.

So if you want a house you will have to be more on top of things but if you want a condo wait as long as you can? Maybe a year or more?

The one thing about shopping right now is that there has been a 'hidden home price drop' in Calgary/Alberta where prices have held up but only the best properties sell. So you are getting larger homes and/or higher quality for the same price (well actually about 8% less already before inflation) as you were buying crap for at the height of the boom. So if you do have to buy that makes it more tolorable?

Of course your current living costs also come into play in terms of when you should buy.

Renters are making out REALLY well right now though. Landlords are often not only subsidizing the rent/carrying costs by a thousand or more a month but are also losing thousands per month in lost home value.

And don't be fooled by any small up-ticks in home prices (next spring maybe?). Just because a bunch of people THINK that the bottom has been hit does not mean it has. There is no reason for a city like Calgary to have some of the most expensive homes in North America. Oil and gas cities much bigger than Calgary like Dallas or Houston offer houses twice the size for half (or less) the money (and dropping!).

(One thing I always say though is that homes prices tend to stagnate and be sucked down by inflation more so than they tend to drop. With a healthy job market in Calgary outright drops will not be as prominent. Of course job losses could change that and we are already seeing that with growing layoffs in construction - construction being the real premium driver of the economy over the past 10 years. I could see this trend gaining steam and then prices have more room to fall with less support for a good ways down... )

Claeren

08-25-2008, 01:27 PM	#280
Claeren Franchise Player Join Date: Jul 2003 Location: Section 218 Exp:	Go back and re-read my posts in this thread -- I have been DEAD ON so far.... Prices are going to keep dropping. Single Family Homes will bottom out before Condos. Urban/Established Neighbourhoods will bottom out before Suburban Areas. Faux Luxury Condos will drop further than well constructed and well priced condos without the faux luxury taglines (OMG GRANITE COUNTERS!? $400,000/500sq-ft IS CHEAP!). Faux Luxury '$475,000-$650,000 McMansions' will drop a lot more than established older homes and/or entry level homes. The elimination of zero down and 40 year mortgages, along with general tightening of lending practices, is going to take another 5%+ off prices (up to 20%?). Higher interest rates in 2009 and 2010 will take another 5%+ off pricing OR higher inflation will wipe away 5%-15%/year in home value. So if you want a house you will have to be more on top of things but if you want a condo wait as long as you can? Maybe a year or more? The one thing about shopping right now is that there has been a 'hidden home price drop' in Calgary/Alberta where prices have held up but only the best properties sell. So you are getting larger homes and/or higher quality for the same price (well actually about 8% less already before inflation) as you were buying crap for at the height of the boom. So if you do have to buy that makes it more tolorable? Of course your current living costs also come into play in terms of when you should buy. Renters are making out REALLY well right now though. Landlords are often not only subsidizing the rent/carrying costs by a thousand or more a month but are also losing thousands per month in lost home value. And don't be fooled by any small up-ticks in home prices (next spring maybe?). Just because a bunch of people THINK that the bottom has been hit does not mean it has. There is no reason for a city like Calgary to have some of the most expensive homes in North America. Oil and gas cities much bigger than Calgary like Dallas or Houston offer houses twice the size for half (or less) the money (and dropping!). (One thing I always say though is that homes prices tend to stagnate and be sucked down by inflation more so than they tend to drop. With a healthy job market in Calgary outright drops will not be as prominent. Of course job losses could change that and we are already seeing that with growing layoffs in construction - construction being the real premium driver of the economy over the past 10 years. I could see this trend gaining steam and then prices have more room to fall with less support for a good ways down... ) Claeren Last edited by Claeren; 08-25-2008 at 01:41 PM.