Quote:
Originally Posted by UFO
^ now that I re-read the post I'm not sure what he actually means.
-rates go up 20-25% like you mentioned (ie. from 4 to 5%); I'm not fully convinced that 1% increase will hit the majority of people as hard as you believe, but I'm willing to take your word for it
-rates go up to 20-25% like I had thought
-mortgage rate goes 'up' and 20-25% of families won't be able to afford their mortgages, which is what I think he is actually trying to say
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So many people stretch themselves to buy as much as they can, as this is what our parents did. Over our parents' time, real estate has gone up and up so this approach was prudent and has created a lot of 'wealth' for them
Times are different, real estate should increase approx. with inflation, 2-3% a year - this is enough, with leverage, to grow one's net worth. But we will see no real growth in real estate in Vancouver for a long time, will lag inflation and likely go down a lot over next 10 year, in my opinion - leverage is a double edged stored - most of ur parents are now mortgage free, they are sitting pretty good (the smart ones who are mortgage free and have savings, and a pension), we're ALL fucked - no more growth in real estate, no more good pensions, there will be no government social security when we're at retirement age... If u haven't realized yet, the baby boomers have fucked us over big time! (Thank your elected officials for this, they should have been able to see this 20 yrs ago)