Quote:
Originally Posted by Red
But real estate didn't go bizerk only in Alberta, and I mean bizerk, not your regular growth like we've seen in the past.
I think construction labour shortage had a lot to do with it too. The builders kept asking more and more money to slow down the demand which they couldn't keep up and the pre-owned homes followed. Now it seems that most of the construction backlog is catching up, how long before we see tons of new homes looking for buyers? And then the price reductions etc.....
Just speculations on my part.
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I think the reason it exploded like it did is because at that time a number of new buying products were introduced to buyers coupled with the strong economic growth in the area at the time. Things like unlimited CMHC mortgages, 0% down mortgages, 40 year mortgages etc.. In 2002 was when they first started allowing CMHC insured mortgages on properties over 200 grand type of thing. So all of a sudden young people who used to need 50 grand in their pocket to buy a 200k house didnt'. That coupled with really low interest rates suddenly allowed people who had a combined income of 70-80k a year to get a 300 k house. Also demographically the front end of the echo generation got to an age where they were starting to be first time home buyers too.