Thursday, May 22, 2008

Canadian Real Estate

It's the biggest investment most of us will ever make -- buying a house. And over the past several years there's been a huge real estate boom. But it appears the boom is over and now the question is -- will we see a bust? Garth Turner is a financial commentator and Member of Parliament. His new book is called Greater Fool: The Troubled Future of Real Estate.
Take a look at the chart above, interest rates are at a much lower level than 1989 yet the affordability is plunging.  The prospects for Canadian Real Estate are very poor since the demographics picture also changes over the next five years.
I would challenge any Canadian to look at the cost of owning home with a forty year amortization, you are better off renting.  Price gains are decelerating, a high probability for the top in price gains in 2008.


This Global Historical probability model is intended for information only and under no circumstances should items be considered as recommendations to purchase or sell investments.
Any statements contained herein that are not based on historical fact are forward-looking statements. Any forward-looking statements represent the Investment advisor’s best judgment as of the present date as to what may occur in the future. However, forward-looking statements are subject to many risks, uncertainties and assumptions, and are based on the Investment advisor’s present opinions and views. For this reason, the actual outcome of the events or results predicted may differ materially from what is expressed. Furthermore, this investment advisor’s views, opinions or assumptions may subsequently change based on previously unknown information, or for other reasons. The Investment advisor assumes no obligation to update any forward-looking information contained herein. The reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements.

These are my own views, please enjoy these insights