Thursday, June 1, 2017

Real estate anxiety

 Apparently "anxiety" is a bona fide mental disorder. Google it. Yup, if your doctor is worth her salt she'll figure out what pill will fix you up.

From what I read on my Google search, up to 25 million Americans may suffer from anxiety disorder.

That's nothing!

Here in Canada, with approximately one tenth of America's population, at least 25 million people are suffering from real estate anxiety.

The millennials are anxious because they'll never own their own home.

Their parents are anxious because their kids will never own their own home.

Pretty much the only folks not suffering real estate anxiety are the ones already sitting on multiple properties.

There are more of those than you might think, and they're not all shady Chinese investors.

I was at a wedding last summer and there was lots of boasting around the room about how clever people were to own two, three, four or even more Toronto houses.

And they are clever!

Toronto has had year after year of double digit residential real estate inflation. Let's say you picked up a little Downsview bungalow for 500k a few years ago. You got in with a 25k down payment. A year later that bungalow is worth 600k.

You just made a 400% return on your investment!

You're a genius!

Unfortunately, the Toronto real estate market is today infested with thousands of such geniuses. Many of them are "professional realtors." Apparently there is no sanction against self-dealing in the realtor's code of ethics.

Those are the folks enthusiastically blowing more air into the balloon.

The correction is long overdue.

Maybe some day our kids will be able to get off those pills and into homes of their own.

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