If someone wants to buy a
house or condo as an investment and rent it out with a negative cash flow while
expecting the price to go up by 4% a year, good luck to you. I agree that it is
totally possible to time the real estate market and make money from it,
depending when you buy. Heck if you bought in 2008 and sold now, that would be
a lot of money that you’ve would made. However, right now it doesn’t seem like
a good time to invest in condos.
When food goes up or gas
goes up in price, everyone complains. Why should we treat real estate inflation
as a good thing? The majority of people buy a home to live in it, not to
invest. How on earth are the younger generations supposed to afford all this
pricey real estate? This is simply not sustainable.
Brad Lamb says that
Toronto is becoming a world class city. It is getting Manhattanized. **ck that.
Again, the majority of people are not going to benefit from that! Incomes in Toronto
have risen by 8% adjusted for inflation between 2000 and 2010. Real estate
prices have doubled. That doesn’t benefit Average Joe, the Torontonian. Yes, he
might be able to afford a monthly payment on a tiny condo due to emergency
interest rates, but one has to ask themselves: why does it take emergency
interest rates to afford a place? How sustainable is that?
It doesn’t really matter
how much prices fall, what matters is that people need to start viewing rising
housing costs for what they really are – inflation.