Sorry for the late reply. To follow up on my previous comments. I have friends that are 2 years out of school making 80k and won’t touch the market. Why not rent for <1000$ and not have to take the risk of a hit in the market. This combined with high prices and increasing interest rates, makes for some to just wait it out. Young professionals probably will see a job change in the 3-5 year range after they start. Why would I tie a piano to my arse? For "home ownership"? If I want a home that bad, I will just wait till I inherit what my parents have. Less risk and mobility for the next 10-15 years.

So why did the market shoot up so bad? Speculators. I have a friend that is in real estate and about 6-8 months before it got "hot" had people from New York throwing down $5-10 million to "buy everything you can". She had multiple investors come through her with this type of cash. Since Saskatoon is such a small market, they bought up everything. When they made a crazy ROI, they dumped it. This is when everyone else was "catching on" to the amount of money you could make. So you had the amateur speculators come in after. These guys are the ones sitting on the property right now, scared as hell that they aren't going to be able to unload. Some amateurs might have got a decent ROI of 10-20% (but nothing compared to these folk from New York), but lots are gonna get screwed when interest rates go up and no one is buying. Now anyone who bought when it was high doesn't want to take a loss, so they are holding steady. I say, bring on the interest rate hikes so that guy from Alberta who thought he could hose some students for rent loses his hat and has to walk away from it. At the same time, let the university bring more rental property on the market to hammer these guys.

The smart ones who know what happened are not going to touch this market until we see the correction. Most of the mine expansions are going to take 4-8 years to come online. This means that the high paying jobs are not rolling in as fast as some might hope. This correction HAS to happen. The wages have not kept up with the cost of living in this province.

Besides that, why would I want to stay here to freeze my butt off in the winter while getting screwed on cost of living? So I can use the river for 4 months a year to get activity in? I cross country ski in the winter and the trails here aren't spectacular. What else do I have to do in the winter? This combined with an hour long drive (to and from work) to the potash mines? What about a week in/week out camp job (Cameco, fort mac)? Ha. I'd rather pay the same to live in Calgary with the Rockies on my door step and an international air port. In terms of professional networking, this place is quite limited. Sure there are a few big companies, but compared to who has set up shop in Calgary it isn't comparable.

On top of this, the new provincial government is playing roulette with half my income. For one, utilities are going up. What hair brain idea are they going to come up with next week to spend the money on? A domed stadium? A nuclear reactor? Or just pay the potash companies for those cash advances? Decreasing social services? I am hardly comfortable giving my money to the bank, let alone idiot politicians.

I was born in the night, but it wasn't last night.

Ginger, I’m also surprised that the bank is willing to lend you 7 times your anual income. I guess that is what the average housing price today is primarily based on.

Thanks to Doug and Cindy – other for the comments. It’s a difficult line to tow with people – not wanting to insult a city they love and have called home since before I was born and still trying to explain why it’s just not realistic for people to think they are going to retain young professionals when the housing market may have just caught up to the rest of the nation, but wages are still lagging.

I don’t want to live in some outdated 70s style apartment off of 8th. My husband and I both work downtown and recognize we’d chew up at least $100/month in parking anyway (the things we tell ourselves so we can sleep at night!) . To be honest, we have two other complaints about the city, really, really poor transit (both of us have always been public transit users until we moved here) and we were promised it was an ‘international’ airport when we came here and that we wouldn’t have problems with all the leisure travel we like to do. Ahem…not so much! Now I have digressed…

Anyway, everything for a reason and at the end of the day thank goodness CHMC stepped in on that mortgage. The house really wasn’t worth what we were going to pay for it, but we were a year into living here, loving it, and loved the house and location so were prepared to add a couple of years onto our five year plan.

It is also crazy the amount of money banks want to lend. We went with one of the big five (who my husband has been dealing with for years) and they threw money at us. Thank goodness we had an excellent realtor who completely understood that our max price we were willing to pay was fifty grand less than what we had been approved for. We worked out what we knew we could easily afford to pay and not leave us house broke.

The loss of that house left my husband disillusioned and his ‘everything for a reason’ meant that we don’t buy here at all, but if prices would even come remotely in line I probably could convince him, but not at this point.

Someone also commented earlier about ‘what the market can bear’. I would like to comment that I think that is incredibly short sighted. Just because people are putting up with higher rents because they don’t have a choice doesn’t mean it’s realistic. It just means you are driving away people like us who have to put away a little less every month in hopes of saving for a responsible mortgage. It means that you are squeezing potentially lower income people every month.

When I think of maple cabinets, I think back to the olden days (20 years ago) when you would see solid maple, finely crafted. Most of these apartments have 80% particle board and 20% maple (mostly veneer). In fairness, your not going to buy a high end kitchen for a low end apartment, so it’s to be expected.

Ceramic is typically fairly affordable for back splashes so I’m not sure if they’re cheaping out in those areas. I know you can buy some kind of a finished wood or paper product for tub surrounds that are manufactured to look like tile.

Yeah, I think there’re a lot of “dated” apartments out there still.

I see you use double quotes when you mention “maple” cabinets, why? And this reminds me of a question: are there materials in this market faked to be porcelain backslash and ceramic tiles? I touched to feel some of the socalled porcelain and ceramic stuff and wonder why they do not have the cold feeling as I would imagine and when I knocked I heard sound as if I were knocking on wood… The thing glues them together is the thing glues the real stuff though.

Wow, it’s looking to be quite the party. Looking forward to seeing you all!

Captcha: “worriers for”. Spooky.

So, it’s not true that every apartment in town has been upgraded with cheap laminate floors, “maple” cabinets and granite counter tops?

I can’t believe how these renovated units all look the same. Someone made a fortune producing large quantities of home improvement products. Still, much better than “dated.”

Thanks. I clicked through the registration link on his site and I see that he has a financial services sponsor. I suspect they throw a chunk of change his way and prospect the hell out those who attend. I don’t care either so I’ve ordered some tickets as well. Hopefully we’ll see ya there.

I saw Turner speak at a CREA conference years ago and I recall that I enjoyed it very much, though his message was very similar then (Get out while you can).

You are absolutely right, very outdated apartments. That’s why I say it’s like a test. Those who can bear with it and who can’t, I’m not sure who are more right though. But the point is, even these shabby apartments they want to charge you $200 more if you don’t speak up.

Norm – almost all of his speaking events are free. Those that aren’t are (I believe) closed to the public — that is to say, he is a hosted speaker for a specific function available by invitation only. As such, there will definitely be some discussion of his latest book and a table of merchandise in the back, but I don’t have a problem with that. Heck, most concerts and speakers you pay to see have exactly the same setup (they play their latest music, hawk their CDs and books) so not sure what the difference would be… except that one doesn’t have to pay for this one!

I have heard him (Turner) speak a couple of times on CBC radio and television… what always strikes me is how his voice does not sound like what I imagine it would sound from listening to his words and looking at his picture.

For sure. I’ve pretty much given up on trying to figure out what’s going to happen. Rates? Prices? It seems clear that governments will go to almost any extreme to control “free markets” in an effort to make themselves look good. Things are no longer predictable. Even what seems obvious can’t be counted on. At this time last year almost everyone was thinking that a fairly serious correction was in store for housing. The national average price has increased 20% since then (fortunately, we’ve avoided this last round, more or less). Bigger bubble? I don’t think there’s any easy and clear answer to that question.

Over the past couple of years I’ve considered selling my house on several occasions. Having learned a number of hard lessons through attempting to “time” the markets I think I’ll stay put and enjoy life as best I can given whatever circumstances unfold.

It seems to me that the most likely scenario is a total collapse of our financial systems. If that happens, the decision on whether to take a fixed or a variable probably won’t be at the top of your list of concerns, or mine. Unless, or until that happens I’m going to continue living my life making decisions which are as prudent as possible for my circumstances and assuming that my life isn’t going to fall apart at the seams.

I do appreciate the concerns of the “professionals” outlined above. A serious housing correction can have significant consequences for young people staring out. It’s one thing to lose equity, but it’s another thing to end up under water. It can take years to get caught up, and it can immobilize you while you’re doing it.

Having a place to go that’s “affordable” enough to make the move is key, and you’re fortunate to have the U.S. as an option if that’s what you want to do. Arizona wouldn’t be that hard to take and there is no shortage of opportunity in housing.

Further to cyn_d’s comments, Turner’s blog is at greaterfool.ca.

Hey cyn_d, do you know if the objective of this thing just to sell books? I noticed that it’s a “free” event.

I guess another motivator behind my wanting to relocate is the fact that I’m originally from Arizona. My wife’s cousin just bought a house in Phoenix last fall for about $90,000. A comparable house in Saskatoon would sell for about $350,000. It has been very tempting for me to move back home with housing costs so low, the only thing holding me back is the lack of job prospects.

On the other hand, I could potentially be mortgage free. Very tempting indeed…

“When and how fast will rates increase? That’s the million dollar question.”

…and how long will they be at higher levels?

Personally, I don’t like the situation here. My wife and I have been happily living in Saskatoon for 7 years now with no complaints, at least none that anyone wants to listen to anyway. Unfortunately, I think there might be trouble on the horizon. I’m probably being overly paranoid about interest rates going up, but considering that they’re pretty well as low as they can go, there’s only one direction they can go.

When and how fast will rates increase? That’s the million dollar question. What I do know is that it doesn’t take much of an increase to have a dramatic effect on monthly payments for a relatively new $300,000 mortgage. I think added interest costs will be another affordability issue that will eventually reduce demand and cause home prices to go down. That might end up putting a lot of folks underwater on their mortgages. I aim to avoid that sticky situation by selling our house in the near future.

Yes, Saskatoon has all these wonderful things to offer. But, more wonderful than Kelowna, Ottawa, Montreal, Halifax, Winnipeg, all with more affordable living accomodations? On the rental side, I used to live in Vancouver – downtown, rented a nice two bedroom basement suite for $750.00/month including all utilities. Freinds of mine currently live downtown, next to the ocean, rent a five bedroom home (mildly dated) for $2000.00/month. So, I think it is absolutely ridiculous the rental prices and home prices in Saskatoon. A part of me does hope that some of these greedy monkeys loose their shirts.

I have a sister in Victoria, current rent just under $900 for concrete 2 bedroom, also convenient area. Very similar to most of the stuff just off 8 th.

It is not reasonable to expect grown ups with good jobs to live in these types of accomodations. I wouldn’t. I benefit from having bought prior to the boom. If I hadn’t, and was graduating now, facing at least $1,000 for a nice one bedroom in Saskatoon? I’d move. Period. It’s an okay place, but who wants to pay top dollar for okay?

Now I face a decision of to upgrade, since I’ve already bought in, or to “cash out” as I’ve seen other posters say, and move some where nice. Tempting, but still a few years from retirement, then again, the premium I could sell my average Saskatoon house for compared to say BC, is a couple hundred thousand dollar swing in my favor compared to a few years ago, and who’s to say it won’t go back that way?
Also tempting to work in BC a few years prior to retirement, but I’m so close that I’d rather just hang on here. And hope our prices are still about on par with most of BC in a couple years.

I know many people moved to the city during 2006 – 2008, due to all the lovable traits Saskatoon has, but I believe the major reason is the housing affordability, which has been gone since. For those who already bought, they’ll probably stay, for those like Ginger, when they get a chance, they’ll leave…

But Ginger do you know that for about $700 you can get a one-bedroom apartment (750 sqft in a concrete building) along 7th Street East (very convenient area,) and $800 for a two-bedroom (not concrete though)? A couple was giving the landlord notice that they would move out since the landlord raised their rent to $900 recently. What they got after negotiation? They switched to another a little bit newer suit with a new rent of only $710. Another couple moved out to another close by building for a 2 bed-room at $800. So maybe before you decide to leave the city, you could try renting at another place. Like I said earlier, vacancy rate seems to have increased, because many couples like you bought expensive houses or condos and moved out. It’s like a test. We’ll see who are the ones smile in the end…

Oh, another thing, more childcare service available now compared to last year. So day care cost should be dropping a little bit as well in the near future I think…

I want to be sure not to get in a pissing match about which city is better. As I tried to articulate earlier, we love Saskatoon. It has a lot of positive attributes; however, attracting and retaining young professionals isn’t one of them.