shawnrk1 wrote:
Mbroker wrote:
The problem here is that a confidence level is also the highest in years in Canada, and it almost never dropped. While high confidence level mostly a desirable goal for any economy, and our government done great job keeping it this way, combined with large debt levels makes long term effect quite the opposite. I was at mattamy event and 500k homes were going faster than a Christmas Wal Mart Sale items. I'm talking about 2600 - 2900 q ft homes. I personally believe the values are not there. Don't mistakes price of the house (the price that we pay) and the value of the house (that’s what we get).
While attending CIBC head economist meeting, they indicated that a 3% increase in interest rates will not only slow down the housing market, but wipe it out. Everything was supported by household income/debt/payment data. It is quite scary believe it or not.
So my suggestion will be to stay put for some time, and concentrate on catching up with debt levels, because we could see some major adjustments in the future.
Lots of really funny old comments but this one is great coming from a broker
"No value buying a 2500-3000 sq ft detached at $500K"
If any of you Mattamy owners think your homes are only worth $450K today contact me I will buy it tomorrow
To be fair they do have a point with the debt level situation. Our own mortgage is about half of what I’m told is “normal” in this town, and we just had to re-up as our 5 year term has ended. Had to settle for a .5% increase, and while it certainly didn’t cause any financial distress, it was annoying enough that we’re taking a good hard look at our financial priorities right now and plan to aggressively attack this bitch.
I can only imagine the stress that a 1% increase could cause a lot of people. It feels like the economy (or whatever you want to call it) is walking on a razors edge.