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Old
12-03-2009, 10:53 AM
  #26
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Quote:
Originally Posted by hockeyguy View Post
I am the most sober person here. You are probably comparing prices to 6, 12 or 24 months ago. With interest rates ready to raise, prices are ready to pop...

Did you miss David Dodge speaking earlier this week about maintaining relatively low interest rates into 2015?

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12-03-2009, 11:47 AM
  #27
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Quote:
Originally Posted by hockeyguy View Post
I am the most sober person here. You are probably comparing prices to 6, 12 or 24 months ago. With interest rates ready to raise, prices are ready to pop...

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Originally Posted by Blakemen View Post
He's right. Edmonton housing is sitting on a deflating housing bubble, which was fueled by historically low interest rates.

If you're willing to buy into today's market, I wish you luck. You'll need it.
So let me get this right. It's a bad time to buy right now while thigns have cooled off and interest rates are low but expected to rise. But it will be a great time to buy a place once interest rates have gone up and prices have skyrocketed again?

Or are you saying that interest prices will go up and housing prices will continue to go down?

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12-03-2009, 12:38 PM
  #28
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That is an American comparison chart, find one from Canada and I will start to listen to you, better yet one from Alberta.

Here is CMHCs forecast for fall for Edmonton, this is the latest from them...
http://www.cmhc-schl.gc.ca/odpub/esu...3_2009_B02.pdf


and again check with EREB.com there is lots of good statistical data there too.

I doubt the market will change all that much, if you are looking to buy and flip in a year now is definitely not the time to buy, but if you want somewhere to call home and for a long term investment and not pay someone else's $1500 mortgage because that is what a house rents for to start with in Edmonton(unless you want to live in the inner city) then I would be buying, . I guess right now it comes down to are you wanting to own or rent. http://www.itoolpro.com/calculators/code/rentbuy.html this is a good calculator and it weighs out Renting vs Buying.

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12-03-2009, 12:44 PM
  #29
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Originally Posted by Reimer View Post
So let me get this right. It's a bad time to buy right now while thigns have cooled off and interest rates are low but expected to rise. But it will be a great time to buy a place once interest rates have gone up and prices have skyrocketed again?

Or are you saying that interest prices will go up and housing prices will continue to go down?
The right time to buy a house is the same as the right time to buy a new laptop.

When you have a need for it.

That said economists have pretty much proven that they can construct an argument to confirm any conclusion you like and I am not sure that history is a great guide in unprecedented situations.

I would think, though, that the correct course of action is to follow the old 'all things in moderation' motto. If now is the time you or your family needs to buy a house then try not to succumb to the siren call of the bankers and realtors and shop in a range below that suggested by the 'professionals'.

As for interest rates? After Chretien/Martin decided it was politically safe to tackle the debt and deficit the first thing they did was transfer as much of the debt as they could from foreign to domestic because they knew that they were going to lower interest rates in order to eliminate the deficit as quickly as possible. Lowering interest rates in relation to interest rates in other currencies always devalues your own currency. I do not see the Americans in a hurry to increase their interest rates given the massive debt they have just taken on until they can at least move their short term obligations to long term obligations while rates are low. Once they accomplish that the huge influx of cash (debt) injected into their system should result in inflation which 'should' result in interest rate increases. I think we will start to see this by next summer.

At that time those that have left themselves little room to increase payments will be in trouble.

Just my 2 cents.

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12-03-2009, 12:55 PM
  #30
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Originally Posted by theoil View Post
The right time to buy a house is the same as the right time to buy a new laptop.

When you have a need for it.

That said economists have pretty much proven that they can construct an argument to confirm any conclusion you like and I am not sure that history is a great guide in unprecedented situations.

I would think, though, that the correct course of action is to follow the old 'all things in moderation' motto. If now is the time you or your family needs to buy a house then try not to succumb to the siren call of the bankers and Realtors and shop in a range below that suggested by the 'professionals'.

As for interest rates? After Chretien/Martin decided it was politically safe to tackle the debt and deficit the first thing they did was transfer as much of the debt as they could from foreign to domestic because they knew that they were going to lower interest rates in order to eliminate the deficit as quickly as possible. Lowering interest rates in relation to interest rates in other currencies always devalues your own currency. I do not see the Americans in a hurry to increase their interest rates given the massive debt they have just taken on until they can at least move their short term obligations to long term obligations while rates are low. Once they accomplish that the huge influx of cash (debt) injected into their system should result in inflation which 'should' result in interest rate increases. I think we will start to see this by next summer.

At that time those that have left themselves little room to increase payments will be in trouble.

Just my 2 cents.
Don't lump all of these people into one stereotype. As I said in my previous post only buy if it is the right time and for the right reason. If you are looking to make money short term then its not a good time to buy. Also don`t buy for your Max allowed as that makes you house poor. what I suggest to clients is that they have a suitable monthly payment that they can afford including taxes and then use that figure when calculating a maximum mortgage amount and how much to spend on a house. Then see if they can qualify based on that amount.

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Old
12-03-2009, 01:08 PM
  #31
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Originally Posted by MerryJ99 View Post
That is an American comparison chart, find one from Canada and I will start to listen to you, better yet one from Alberta.

Here is CMHCs forecast for fall for Edmonton, this is the latest from them...
http://www.cmhc-schl.gc.ca/odpub/esu...3_2009_B02.pdf


and again check with EREB.com there is lots of good statistical data there too.

I doubt the market will change all that much, if you are looking to buy and flip in a year now is definitely not the time to buy, but if you want somewhere to call home and for a long term investment and not pay someone else's $1500 mortgage because that is what a house rents for to start with in Edmonton(unless you want to live in the inner city) then I would be buying, . I guess right now it comes down to are you wanting to own or rent. http://www.itoolpro.com/calculators/code/rentbuy.html this is a good calculator and it weighs out Renting vs Buying.
CMHC also forecasted a 30+% increase in housing prices at the tail end of the boom when in fact the prices were flat or even down a little bit for that year. Its hard to say what is going to happen. I agree that if the poster is looking to set roots, now would be a pretty good time to buy considering the low interest rate. I would not be buying as a short term investment right now either.

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12-03-2009, 01:23 PM
  #32
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Originally Posted by MerryJ99 View Post
Don't lump all of these people into one stereotype.
A little oversensitive there Merry. Nobody over the age of 12 thinks that all the people who perform the same job do so in exactly the same way.

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Old
12-03-2009, 01:27 PM
  #33
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A little oversensitive there Merry. Nobody over the age of 12 thinks that all the people who perform the same job do so in exactly the same way.
Except for realtors. They are all going to the hot place.

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12-03-2009, 01:28 PM
  #34
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Originally Posted by I am the Liquor View Post
CMHC also forecasted a 30+% increase in housing prices at the tail end of the boom when in fact the prices were flat or even down a little bit for that year. Its hard to say what is going to happen. I agree that if the poster is looking to set roots, now would be a pretty good time to buy considering the low interest rate. I would not be buying as a short term investment right now either.
The question for me (which I don't have a clue to) is whether or not we are headed into long term decline. So much of our economy is based upon 'herd reaction' that I really don't know what to think about this anymore. Greed and fear both have very powerful pulls on people's decision making and right now I can't tell which is winning.

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12-03-2009, 01:32 PM
  #35
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The question for me (which I don't have a clue to) is whether or not we are headed into long term decline. So much of our economy is based upon 'herd reaction' that I really don't know what to think about this anymore. Greed and fear both have very powerful pulls on people's decision making and right now I can't tell which is winning.
It is really linked to the price of oil for us. I recently bought a car in Grand Prairie (dont ask) and I used to do a lot of work in the patch up there. The salesman was also a former patch monkee and he said that that conditions arent that bad up there and sales are pretty steady. As long as interest rates dont go through the roof and the price of oil doesnt bottom out, the market for houses will still be ok.

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12-03-2009, 02:05 PM
  #36
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Originally Posted by I am the Liquor View Post
It is really linked to the price of oil for us. I recently bought a car in Grand Prairie (dont ask) and I used to do a lot of work in the patch up there. The salesman was also a former patch monkee and he said that that conditions arent that bad up there and sales are pretty steady. As long as interest rates dont go through the roof and the price of oil doesnt bottom out, the market for houses will still be ok.
Agreed. And housing is so locale sensitive. I live in Victoria these days and the job market seems to have nothing to do with housing prices. The ability of people to cash in and retire here, on the other hand, seems to have a huge impact.

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Old
12-03-2009, 04:13 PM
  #37
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A little oversensitive there Merry. Nobody over the age of 12 thinks that all the people who perform the same job do so in exactly the same way.
I guess I forgot the there. No not oversensitive...

this is interesting this is the new forecast from Remax which really is the same as CMHC and CREA, and most of the banks, it is in a PDF so I cannot post a link, this just came in my email today, take it for what it is.

Quote:
The good news is that real GDP is expected to climb three per cent in Alberta in 2010, bolstered by housing, new construction, a recovering oil and gas
sector, and consumer spending. Oil prices are expected to hover around the $80 mark—which should serve to kick-start activity in the mega sand projects. Improving
global demand for commodities is forecast to place upward pressure on prices, while rising confidence and more normal crop conditions should also have a positive
impact on economic performance in 2010. Retail sales at 5.6 per cent will be one of the top performers in the country, falling just behind British Columbia and
Saskatchewan. Unemployment levels hover at approximately 7.1 per cent.

Building on the real estate recovery already underway, the number of homes sold in Edmonton is expected to edge slightly higher in 2010, rising to 21,000, up two
per cent over 2009. Housing values, finally on the upswing, should reach an estimated $330,000 by year end 2010—a three per cent increase over one year
earlier. Inventory levels—at about 5,500—are forecast to remain stable, representing a three to four month supply. Market conditions should be balanced
throughout much of the year, leaning slightly in favour of the seller. First-time buyers are expected to once again play a significant role, stimulating activity in virtually every segment of the market. It’s anticipated that demand for condominiums will be constant, given their affordable entry-point. An influx of new conversion
units in months ahead should be absorbed relatively quickly but fewer multi-unit housing starts in 2010 overall may apply some pressure to the resale market

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Old
12-03-2009, 04:22 PM
  #38
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http://www.edmontonjournal.com/busin...200/story.html

Just trying to be helpful.

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12-03-2009, 06:04 PM
  #39
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I don't understand why it would be a bad time to buy when the interest rates are low. You get locked in for 5 years and don't have to worry about them again for awhile.

I am currently looking in Calgary and I don't think the home prices are that high, they seem fairly level compared to when they went crazy with the oil boom a couple years ago and when they dropped with the so called "recession".

Advice for the OP, when I was looking in Edmonton I avoided only two areas entirely, around the coliseum and millwoods. Those two areas will probably not gain any value for a long time. Also the South West is a nice area but take into consideration it will add to your driving time because I have heard it is a b*tch to get to the north from.

If you are getting a condo make sure you know the condo fees and their reserve fund. Also remember that those condo fees can be increased I think at any time. Right now two areas that are very nice that aren't south of the river are the very northeast and the west around 153ave. The North East seems to be developing and is very young, I probably would have bought there had I still been interested in Edmonton.

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Old
12-03-2009, 06:46 PM
  #40
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Interest rates have a huge impact on your monthly payments. A person is better off to buy now at a great low rate than worrying about a drop in value of their home by 10 or 15k over the short-term.

Use the "Mortgage Payment Calculator" on this page:

http://www.atb.com/Dev/calcs/calcs_loan.asp#

Play with the numbers. Take a look at how much more you will have to pay if you wait until interest rates go up. Rates now are going to save you more money than waiting until rates go up and houses decrease marginally in value. You will likely never get better interest rates than you can get today. When the economy turns, there is a good chance houses will continue to rise in value anyway no matter what fear mongers may tell you.

And I agree with one of the posters above: Buy a house when you need one.

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Old
12-03-2009, 06:49 PM
  #41
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I think people aren't thinking straight when you don't buy when the market is down and interest rates are at a all time low.

But that's just me.

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Old
12-03-2009, 07:15 PM
  #42
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Originally Posted by MerryJ99 View Post
I guess I forgot the there. No not oversensitive...
Fair enough. I didn't mean to slander anybody - it was just an observation on how so many people have gotten themselves in trouble in the past. Of course I am old enough to remember friends of mine losing everything when the oil industry collapsed in the early eighties. Too many people were mortgaged to 90% and couldn't keep up when the interest rates skyrocketed. These days being mortgaged to 90% seems to be getting common again.

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12-03-2009, 07:18 PM
  #43
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Originally Posted by CMacdonald View Post
I think people aren't thinking straight when you don't buy when the market is down and interest rates are at a all time low.

But that's just me.
I guess the questions are 'down from where?' and 'how long before interest rates go back up?'

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