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Originally Posted by urban1
Its not just the down payment people cant afford.
Not everyone is a professional working in oil and gas.
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But everyone that wants to live in Calgary has to pay the market value for homes. So they can increase their down payment (borrow it from parents), buy a smaller place, or extend their mortgage over a longer time span. Or they have to move somewhere else.
It sounds like you don't think it's right or fair, but the market doesn't take your sentiments into account; it doesn't care what you think.
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Its gonna be real tight and you better hope nothing unexpected happens. And you want a second or third kid and to save for their college, your retirement, and a vacation every so often?
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Agreed, people have to look at their whole lives when making a house decision. But again some feeling of what's fair doesn't impact things. Plus the biggest unexpected thing could be interest rates. Personally I think they'll stay low for quite a while, but if they do go up that'll have a huge impact.
While Calgary seems expensive now to us, it's still low compared to other places around the world in terms of amount of income needed to buy a home.
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And your example of a condo as a starter home has the problem that housing on average goes up at the rate of inflation. The past couple of years where you could have bought a condo for $200k and then it almost doubles in value are gone. In a market where you can rent for cheaper than buying and housing isnt appreciating, you can be better off renting and saving the difference instead of earning a bare minimum in appreciation but paying a ton of interest.
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I agree with this in that some markets it can be better to rent than to own... However I'm interested in what kind of growth you think we'll see in the housing market going forward, and what economic indicators you use to determine that.