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Originally Posted by Clarkey
Is the market really going to face a downturn anytime soon though? I think it may level off or increase at a lower rate but I doubt we will see price decreases in the real estate market. The wait and see attitude is one you might regret, you want to get in now if you can.
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EXACTLY. Get in a soon as you can. CMHC is predicting that the housing prices are going to continue to increase quite rapidly until the end of 2007. The house you are looking at now might cost you $75,000 or $100,000 more in a year.
Housing prices are not going to drop in Calgary. They may slow down and level off but you will not lose money.
This sudden rise in housing prices is almost a correction of undervalued property. Even with the increse of prices as of late the affordability index is still relatively low for Calgary.
Housing Affordability Index (Q1 2006)
Detached Bungalow (a reasonable property benchmark for the housing market)
(RBC housing affordability index measures the proportion of median pre-tax household income required to service the cost of a mortgage, including principal and interest, property taxes and utilities on a detached bungalow. This measure is based on a 25% downpayment and a 25-year mortgage loan at a five-year fixed rate and is estimated on a quarterly basis. The higher the index, the more difficult it is to afford a house.)
Canada......................38.8
British Columbia.......58.1
Alberta.......................30.5
Saskatchewan..........29.3
Manitoba...................33.5
Ontario......................36.4
Quebec.....................34.8
Atlantic......................27.6
Toronto.....................40.8
Montreal...................34.9
Vancouver................64.4
Ottawa......................28.9
Calgary.....................32.7
We are still way behind Toronto and Vancouver as far as housing affordability goes. We are even slightly trailing Montreal. There is still a lot of room for price increases in this city. They are going to continue to happen. Don't wait any longer. The longer you wait to get in the more it is going to cost you.