(no subject)
Jun. 6th, 2012 01:41 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
raincitygirlSo I think Vancouver’s real estate bubble may finally be deflating. I got my property tax bill the other day, and my little cubbyhole’s assessed value is $28,000 less than it was last year. Which is good for me, since I save a few pennies on the tax bill compared to last year, and good for people who’ve been unable to get in the market thus far because prices are sky high (even though we’ve been in a recession for four bloody years). Maybe they can afford to buy now, although they may wait to see how much worse things are going to get. Ah, liquidity traps.
Of course, the current situation is MUCH less good for people who bought when prices were higher and have huge mortgages. Caveat emptor and all that, but it still sucks for them. Especially because there’s all this media propaganda about how owning your own home is THE mark of fiscal responsibility. Although there’s less of that in general since the sub-prime loan crisis blew up in the USA. (Fortunately Canadian banks were more strictly regulated)
But there’s still a mentality that real estate is automatically a good investment. And it is, I guess, over a period of about thirty years or so. But if you end up in a tight financial pickle at some point over those few decades, it could end up not being such a good investment, especially if your investment needs a new roof at a time you don’t have the money for it.
I will never forget around about 2007, there was a wonderful (by which I mean horrible) buy-your-first-home ad campaign by one of the banks or big credit unions (I forget which) with the tag line “We lend money to just about anyone”. It left me with a fervent desire never to do business with that bank in any capacity. But obviously it wasn’t memorable enough, since the name of the financial institution in question wasn’t sufficiently seared into my cortex.
Of course, the current situation is MUCH less good for people who bought when prices were higher and have huge mortgages. Caveat emptor and all that, but it still sucks for them. Especially because there’s all this media propaganda about how owning your own home is THE mark of fiscal responsibility. Although there’s less of that in general since the sub-prime loan crisis blew up in the USA. (Fortunately Canadian banks were more strictly regulated)
But there’s still a mentality that real estate is automatically a good investment. And it is, I guess, over a period of about thirty years or so. But if you end up in a tight financial pickle at some point over those few decades, it could end up not being such a good investment, especially if your investment needs a new roof at a time you don’t have the money for it.
I will never forget around about 2007, there was a wonderful (by which I mean horrible) buy-your-first-home ad campaign by one of the banks or big credit unions (I forget which) with the tag line “We lend money to just about anyone”. It left me with a fervent desire never to do business with that bank in any capacity. But obviously it wasn’t memorable enough, since the name of the financial institution in question wasn’t sufficiently seared into my cortex.
