Housing prices have outstripped incomes. This is one of the fundamental tells of a bubble market. -vreaa
This from Gordon C. at vancouvercondo.info 5 Feb 2010 10:24 am -
“In the early 80’s I was working in Vancouver. A friend offered me his two-bedroom rancher in Marpole for $135,000. At that time I was making $36,000 a year and interest rates were around 12 percent. I didn’t buy, then house prices started going up and I was left behind. I gave up on ever owning a home and instead went back to UBC and later travelled through North America. If I had to do it all over again. I would do the same thing, except study a little harder and leave Canada for the states. I certainly would not want to be strapped to house payments in my 20’s for 25 years. My payments would just be ending now.”
Not much of a name added (11:11 am) – “Funny thing is, that house is probably worth over a million now and incomes are at about $60-70k. Incomes have not kept pace with RE prices.”
He’d rather not be a millionaire? That’s silly. You could have withdrawn equity every year instead of working, had the same income, and done all the same traveling, etc.
Let’s face it, whether you saw the macro trends or not, if you bought in the 80′s you won the lottery. Now with interest rates reversing a 30 year cycle, if you loaded up on debt in this decade you may have effectively lost the lottery.