Quote:
Originally Posted by macker
You might be right....maybe real estate crashes are things that happen to people in other countries at other times; crises do not happen to us, here and now. We are doing things better, we are smarter, we have learned from past mistakes. The old rules of valuation no longer apply. Unfortunately a highly leveraged, housing market can unwittingly be sitting with its back at the edge of a financial cliff for many years before chance and circumstance provoke a crisis of confidence that pushes it off.
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And with that you've jumped into the dramatic talk.
I never said "we do things better, we are smarter, we have learned from past mistakes or they happen to other people in different countries" FFS. In fact I said nothing even remotely close. I wonder every day if things could take a serious nosedive. OSFI meddling with CMHC, mortgage insurance, inflation, interest rates, etc. There's a ton of "what ifs" out there that scare me. I'm kind of in the market for a new house but wonder and flip and flop on those very items every day.
In the end the decision I will make will likely be:
1. What can I afford now
2. What can I afford in the future under a given interest rate environment.
3. What will rental rates be in the future.
The rest is just noise. Unfortunately those above 3 questions are very very difficult.
All I was saying is: to say is going to happen is about as useful as saying it will never happen. Even though one side is likely to be correct (the it will happen), there's a chance when it happens it might not be for the reasons that all the current naysayers are saying.
This thread was started almost 4.5 years ago and there's been no massive fallout in Calgary. The guy posting the Alberta Bubble Blog hasn't been here in 1.5 years the last post on that blog was 2010. Some other doom / gloom blogs last post was 2009. None of those people were predicting the government would pass off CMHC to OSFI or debate it's outright removal from the market or privatization. Change in amortization rates, amortizing HELOC's, 65% HELOC max, etc.
Heck the next major real estate fall out in Calgary could come in 3 years because oil becomes obsolete. The smart people who thought real estate was a good investment would likely say "damn, didn't see that coming, I was able to afford the place I bought, I can make my payments at various interest rates, I didn't borrower too much etc." and the naysayers would probably say "idiots, I knew real estate was going to tank".