Spring’s the time of year when the housing market kicks into full gear. But just how sustainable is the sector? And is a home still a shrewd investment? With soaring prices, now’s a good time for Canadian home owners to look at what they can learn from inflated markets elsewhere.
“There are still many countries where residential real estate is the preferred means to create wealth,” says Robert Stammers, director of investor education at the CFA Institute. “In India, for instance, most people try to buy a home if they can because the adage there is ‘real estate never goes down in price.’ However, this was the exact same sentiment we saw in the U.S., which eventually led to the market downturn.”
Remember, you’re an investor
When American lenders began giving out 100-per cent loan-to-value mortgages and homeowners used leverage to increase the size of their purchases, Stammers explains, it was a signal that homes were becoming overvalued. Home owners can get into trouble when they forgetRead More »from Global real estate lessons for Canada