“People get very defensive about their housing investments. My own father is like that. He refuses to countenance the possibility that housing values will ever decrease in Vancouver. A retired psychologist, he poured just about all his money into his gargantuan home. Given that his house represents the sum total of his life’s savings, the thought of it coming down 30% is more than he can stomach, apparently. He even refuses to read about the housing crash in the US. I suspect he might even deny its existence.”
– Jim at Ben Rabidoux’s ‘The Economic Analyst’, 31 Aug 2011. [Hat-tip to Ben, whose site is a daily must-read for anybody trying to keep up with economic developments in Canada.]
Wow, quite a story.
Illustrative, and also poignant.
Retirees are overly dependent on RE for their financial well-being.
Blind hope is not a good financial planning strategy.
Being a (presumably) intelligent professional is no guarantee that you will be wise with your finances.
There is a strong tendency for people to ‘talk (and act) their book’.
Psychologists are human too.
It is very difficult for most Vancouver owners to apply sensible analysis to the market while past performance, optimistic headlines, rote slogans, BBQ-talk, and their own hope, distracts them.