“My wife and I bought our first home in Oshawa in 1989 for $178K. Seven years later, after many renovations, we could only sell it for $148K.”

“My wife and I bought our first home in Oshawa in 1989 for $178K. Seven years later, after many renovations, we could only sell in for $148K. Mind you, we then bought in the same down market in Toronto’s High Park area. The home we bought in Toronto, for $325K, had been listed at $580K just 18 months before we bought it. That gives you some sense of how the market corrected. We sold that same house this spring, for $975K, exactly three times what we paid for it 16 years ago. It obviously does depend on when you buy and when you sell, it always has. BUT, we are experiencing prolonged and historic low interest rates, and Mr. Flaherty’s creation of the 0 down/40 year amortization did create a subprime effect here in Canada. We have never seen a run-up in home prices like this before. The correction, one would think, will be greater than the ones we’ve seen in the past, given that so many people are so over-leveraged.”
- comment by ‘ReMaxed Out’, at The Globe and Mail, 11 Dec 2012 11:27am

“We have never seen a run-up in home prices like this before. The correction, one would think, will be greater than the ones we’ve seen in the past..”
That’s pretty much our opinion, too. Perhaps the Vancouver 1980′s bust will compare. – vreaa

4 responses to ““My wife and I bought our first home in Oshawa in 1989 for $178K. Seven years later, after many renovations, we could only sell it for $148K.”

  1. “0 down/40 year” did NOT create this bubble. It only added fuel to a 4 year old fire.
    It may have added to the subprime segment of the market, but like in the US, subprime is at the margin and not the core of the problem.

  2. Well, the guy bought in Oshawa….duh!

    As we all know RE is all about location, location, location. Heck even Garth has now been proclaiming that certain highly desireable neighborhood will not fall much in price.

    Yeah it’s sacarsm….

    though Vancouver has punched way above its weight in this runup, it will be
    interesting to see how this goes down. If we get leaky condo crisis 2.0 – which I can’t believe hasn’t happened yet – it will be very interesting. The building industry here has basically got itself a secure job regardless of market condition. It will be busy and getting paid handsomely whether building new builds or repairing new & old builds.

  3. Being from oshawa myself and a Realtor during the down cycle. the market was on its way up again from 1996 so I can’t agree that after your renovations it was worth only $148,000 representing a $30000 reduction plus the costs of the reno’s. Your contractor must have done a poor job or you rented it out and it looked worse than before you started can’t be blamed on the market. South Oshawa was always and still is cheaper than the North end so location for prices to increase accordingly should be compared to the same type of locale to consider a 3 fold increase in the Toronto area. ( High Park of all places ) I also don’t think Mr Flaherty can not be blamed for causing this upward spiral, all business in General took a hit across Canada from 1990 to 1993 after which it still took time to rebuild the economy.People who had to sell, sold at discount prices because they didn’t have jobs. Greedy Buyers looking for steals and a way to recoup losses started flipping homes at higher and higher prices driving prices up.. Buyers would have to be fools not to buy when interest rates were at an all time low. I also doubt that anyone would have bought in High Park with ” 0″ down and a 40 year amortization.
    .

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s