# Calgary Real estate



## gladaki (Feb 23, 2014)

There is a bidding war going on calgary, but I dont see this justifiable in terms of market. There are not many projects and people are looking for jobs...
Is it just me who thinks its all speculative ?


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## OurBigFatWallet (Jan 20, 2014)

I think part of it is but also part of it is just the health of the local economy. In my industry (finance) there are tons of jobs available and not many people to fill them. I have three coworkers who have bought homes in the past few months and they've all been in bidding wars. I've never seen it this hot ever. Hopefully it calms down soon


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## Plugging Along (Jan 3, 2011)

Calgary is a hot job market right now. It is just starting to pick up, and it is going to hit crazy I predict in the next couple of years. I don't think it is speculation. Many of the oil and gas companies are in their feasibility and planning phases. So the engineers, the project managers, ect. Are quietly being recruited. Once these projects go into construction (usually acouple years time) all the labourers and construction people will boom, then they will start taking the most skilled of the lesser skilled people. 

I feel in Calgary, just like the stock market, when everyone is taking about the boom, you are well in to it. 

My spouse and I have noticed a steady increase in the number of jobs opportunities we get called for. I think Calagry is silently preparing for a boom.


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## gladaki (Feb 23, 2014)

OurBigFatWallet said:


> I think part of it is but also part of it is just the health of the local economy. In my industry (finance) there are tons of jobs available and not many people to fill them. I have three coworkers who have bought homes in the past few months and they've all been in bidding wars. I've never seen it this hot ever. Hopefully it calms down soon


I follow your blog and great admirer of your tips. ...
Yes, I know its a healthy economy but some how I feel that with my pay of 75k$ I can never save for house downpayment of 20%. Assuming I have 0$ right now even if I save half of my income..2000$ for 1 year....it will be 4 years before I save 100k$ for doing downpayment of 450k$ avg house..

or May be parents helping their kids to buy houses, which is not in my case.


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## Plugging Along (Jan 3, 2011)

4 years is not never. 

I don't think it should be an expectation that one buys a house when first starting out.

There are also lots of starter homes under $450, and many condos for under that price. You didn't mention how old you are, but what is the rush to buy.


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## Karlhungus (Oct 4, 2013)

gladaki said:


> I follow your blog and great admirer of your tips. ...
> Yes, I know its a healthy economy but some how I feel that with my pay of 75k$ I can never save for house downpayment of 20%. Assuming I have 0$ right now even if I save half of my income..2000$ for 1 year....it will be 4 years before I save 100k$ for doing downpayment of 450k$ avg house..
> 
> or May be parents helping their kids to buy houses, which is not in my case.


Why do you feel the need to have 20% down? There is nothing wrong with putting down 5% if you think the economy is heating up. Put down 5% and then make extra payments.


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## gladaki (Feb 23, 2014)

Plugging Along said:


> 4 years is not never.
> 
> I don't think it should be an expectation that one buys a house when first starting out.
> 
> There are also lots of starter homes under $450, and many condos for under that price. You didn't mention how old you are, but what is the rush to buy.


I am 30  it's been three years I started working. I came to Calgary on my own for grad studies


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## sags (May 15, 2010)

Based on my own life experience........albeit from the past generation of home buying........I would just put out some points to ponder.

1) The lowest interest rates we paid over 25 years of mortgages........was 7.99%. The highest was 19%. The current interest rates are a rock bottom bargain......but are far below historically normal rates. Advice.........income test what would happen if interest rates were to double. Could you still manage?

2) People move much more often than they think they will. Advice.........seriously consider how long you will stay in Calgary.

3) People move......not only to another location.......but often to another home in the same location. Advice........buy a home you would be happy to stay in.

4) Consider how solid your employment prospects are. If you were to lose your current job........could you find another where you live.

5) Plan your retirement without factoring into home values. Don't put all your financial assets into one possibly illiquid asset.

6) Make the payments and if possible pay down the principal in lump sums. Never borrow against your home. Consider it untouchable. 

Everyone has to live somewhere.....and if people can afford the payments and own the home for a long time.........price fluctuations in the interim don't really matter.

You might pay more......you might pay less........if you are staying for 30 years.........worry about it in 2044.


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## JamJam23 (Nov 8, 2013)

Like people are saying, Calgary's economy is very strong. With all the LNG prospects in BC, the oil sands doing well, and the potential for some big pipeline projects, there could be many good years ahead.

I graduated from university last year, got a job right away that pays 90k (salary + bonus + RRSP contributions). My company's workforce grew 68% from 2012 to 2013, and the anticipate to grow another 40% this year.

If I was you I wouldn't wait to have 20% down.


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## NotMe (Jan 10, 2011)

I'll take "Someone will post 'this won't end well' for $500, Alex."


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## sags (May 15, 2010)

Homes have a base value.......the cost of the bare land, the cost of servicing the land, and the cost of building the home.

When an existing home climbs from a value of $450,000 to $550,000...........it is difficult to quantify a reason other than pure speculation.

I was with a land owner, who was developing a large farm tract he owned into building lots. 

"These lots", he said, "are for sale for $100,000. Those lots over there are going to be $130,000"

When I asked him why he would be selling them for $30,000 more.........he said........."because I can".

That basically sums up the housing market.


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## NotMe (Jan 10, 2011)

sags said:


> Homes have a base value.......the cost of the bare land, the cost of servicing the land, and the cost of building the home.
> 
> When an existing home climbs from a value of $450,000 to $550,000...........it is difficult to quantify a reason other than pure speculation.
> 
> ...


Doesn't that sum up every market? Without getting too marxian, the goal of capitalism is to sell the product of your capital for as much as the market will bear.


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## Taraz (Nov 24, 2013)

Some if it is also due to the housing shortage caused by the floods last year, I'm sure. Calgary is doing quite a bit worse on affordability ratios than Edmonton is (for now, at least).


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## peterk (May 16, 2010)

Even people in Fort Mac are leaving to Calgary! 4 out of a group of 20 in my department alone in the past year. 3 or 4 more in other departments nearby have done the same.

One has bought a townhouse for 850k recently, and another just lost 4 bidding wars in a row and has given up and is getting a builder.


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