Owning a house - good investment? My views.

[nbowa]

Owning a house is always been a push that the USA has done for decades. Part of it was to expand the market. In 2008, it was apparent that the banking industry was way over-leveraged; giving people loans for up to 105% of the value of their house. When the values came crashing down, so did people's net worth's, many of which were way underwater

Comments

[p_pardus]

Good write-up. I’m in Canada, so the same rules don’t apply in some cases like our mortgage interest aren’t tax deductible, or having 30-year fixed rate terms (I think our max is 5 years, then you’re up for renewal), so we actually have some more risk then you in that respect.

In Toronto, the last bubbly housing location in Canada, if you have a livable detached house then you can expect to fetch more than a million dollars for it right now. Yup, we’re definitely in a bubble.

I’m not directly in Toronto, but I probably shouldn’t have renewed my mortgage and sold my condo. It would almost certainly mean I would get over $100k capital gains on it. Granted I’m too lazy to move and it would be a pain to find a new place, even rental, so I’m keeping it for now.

One of my favorite blogs is a former MP (Canada) and financial dude who started a blog about the 2008 crash (before it happened) to sell his book. He has continued it today talking about the housing insanity in Canada, as well as financial stuff like tax avoidance, registered / non-registered investment accounts, and stock management.

His writing style is very colorful and so the blogs aren’t dull as you would expect from a financial blog and usually takes about 5 minutes to read through. He posts daily. I’ve learned a lot from him and I’m a lot more strategic with my finances now and informed.

Have a read through a few of his blog posts. It’s amusing although some people might not like the tone the humor takes: http://www.greaterfool.ca/

Oh, also, the pictures are great in these blogs too.

[nbowa]

Thanks for the link! What a good read! :)

I feel like Australia is in the same boat, HOWEVER, the Chinese are dumping $$$$ into it, so it might be, as long as there are investors. Many people have no hopes or dreams of ever owning in Australia, so they spend on enjoyment, and assume rent is the way to go always.