Quote:
Originally Posted by jackmeister
(Post 8739823)
I wish I had that crystal ball as well since I bought into resources too. Then again, Canadian banking stocks are notoriously safe investments.
However, just remember in 2011 there was this thing in the US called Quantitative Easing, and the same thing in different names and forms around the world. The main purpose of QE was to bail out all the risky investors that lost money in poor investments, and thus allowed them to cash out and reinvest in "better" investments. Not only that, no one knew when the Feds would stop putting money into the market (somewhere around 80 billion a month?). The governments were backstopping everyone's stupidity/greed with no end in sight. Imagine going to PNE with a limitless ATM and playing the carnival games until you win that elusive big stuffed animal. The limitless ATM ended up being $4.5 trillion dollars.
Around that time interest rates were trending down, companies were merging or buying out each other, bidding wars for companies, credit was easy to obtain, commodity prices were stable, Osama was caught, US consumer spending was slowly improving. etc. I wouldn't dare to say "the writing was on the wall" but there were definitely more than enough signals to see where equity markets were heading and more importantly, how the major players (funds/conglomerates/state-owned companies) would benefit.
And in Vancouver, 2011 we were still thinking about the Olympics and too caught up with the Stanley Cup. I don't recall overnight lineups at condo presales or bidding wars. There were a lot of new immigrants and lots of new cars on the road, but nothing too much out of the ordinary. Houses were still being sold around asking, and property wasn't hard to find.
Not that it matters now, since that boat has long sailed. Maybe that fellow who sold the real estate, rented and invested all the capital is now on a hookers and blow diet or still working 9-5. But at that time a few years back, if you looked at the potential of RE and equity markets given your financial experience, you made a choice that seemed right for you. At that time you didn't anticipate 15% gains YoY on real estate.
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You said it perfectly!
No one anticipated the RE to continue to boom like it has. The numbers are staggering, and it's now spread to the valley. When the luxury dealerships opened in Langley, I should have known. But I saw folks that I know were working class heroes, leasing Benzes and Range Rovers like they were Hondas. They were able to get financing through the increased value of their homes. To me, that's incredibly dangerous. But we're three years into this, and all that has happened is more increases in value.
I made a lot of money in RE since 2000. Buying a home, living in it for three years, then flipping it for $150k profit was the norm for us. To the point where I considered getting my RE license. Everyone I know was selling their million dollar properties. But this was also 2008, just before the big US crash. I saw folks lose millions in developments gone sour, and that's when I figured that we were in for the same.
But we weren't in for the same. I saw a lull in 2010 when I sold my last home in Morgan Creek. It took a year to move that place, and I had to fight to get my asking price.
Fast forward to 2014, and that same house that I sold for $1.2, sold for $1.45
WTF?! $250k in 4 years?
My only purchase after that was in Whistler in 2014. We're up about $120k on that already. But it does me no good, because I could never replace it for that kind of money.
Quote:
Originally Posted by 4444
(Post 8739938)
everyone in vancouver is right, yet somehow all these 'right' people are demanding government intervention in real estate.
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Those folks who made the money have realized that everything has gone up at a similar rate. So they sell their $500k house for a million. But the minute they try to replace what they had, they find that it's also a million. They traded dollars for dollars.
What I'm hoping for is gov't intervention that will cause a drop in the value. So I can take my high selling profits, and use them to buy low again. But alas, I think those days are gone regardless of what the gov't does.
Quote:
Originally Posted by unit
(Post 8739742)
with your apple example, you'd be buying apple on sale in april 2013. in some cases it works much better in your favor, so it's a bit more complicated than what you've stated.
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If it wasn't complicated, we would all be rich.
:)
