However, this is the internet. Mention that you spoke to an American who wasn’t worried about real estate meltdowns and you’ll be accused of recommending that people buy real estate (which is pretty much where my bull credentials come from).

what is wrong with investing in RE buy low sell high? what does it have anything to do with ethics? by your description, Rob should buy RE low and provide rent free to the needy? I suppose that you donate all your income to the charity then!

Rob, I love you, your beginning to say it like it is.:P

If such a unicorn exists in Vancouver right now, I suppose it would be ok to buy. ;^)

No hard feelings. I had hoped to make that clear in the post. My point is that you made some unsubstantiated assumptions about me (not your Realtor friend), and treated them like facts. That happens too much on the net. (BTW, it could be that your friend is hitting the sweet spot in his career at the same time the market is going up; his present success could be the result of other things as well). Bottom line, no offense taken, and none intended back your way.

You’re right; I did fail to answer your question, so I’ll do so now. When I talk with people about buying real estate, we look at the whole picture. That includes the downsides. You may have noticed that I’ve said on more than one occassion that with investment property you need to take care of the downsides and let the upsides take care of themselves.

Additionally, I tell people to buy and hold long term. The clear implication, and one which we explore, is that between the present and the long term there may well be some rough patches.

I also make it clear that all of my projections are made on the basis of an assumption. The assumption is that real estate in the Lower Mainland will continue to increase in value, and will do so, long term, at 5% per year. The facts indicate that we’ve done better than that, but I’d rather under-promise, so I pick a low number, and I make it clear that its an assumption, not a guarantee.

In other words, I make it clear that I can’t predict the future any better than the client, and what’s more, I don’t try to. I share my belief that real estate will go up in value, long term, and I share the effects of the numbers (and that’s just math). I offer some competitive services for people who share my assumptions.

If someone follows my advice and actually loses money they tend to share blame with me. It hasn’t happened often over 20 years, because we try really hard to avoid it, and because if we make a boo boo we try to mitigate the losses. I can count on one hand the bad deals that we made (if you define bad deal as an actual loss of cash).

Think your scenario through, btw. I advise someone to buy something they can hold long term that meets specific criteria. They put 25% down and do so. After 20 years it hasn’t gone up in value at all, but the mortgage is paid off, they’ve enjoyed certain tax advantages and they have free cash flow. The extent of your complaint is that they could have used the 25% down differently and gotten a better return if they’d invested somewhere else, but that’s predicated on real estate not rising in value at all over 20 years. Its unlikely that that would happen, and if it did its likely that the proeprty could have been bought for much less than 25% down.

And Rob, if you feel offended, I apologize as it was not intended that way. If my words were a little too strong, perhaps I just wanted to put more emphasis countering the bulls and it was not personal.

In most cases it would have to be a unicorn, but not all. You’ve still got portfolio improvement (sell a dog, get a gem). Also, there can be situations where people simply have to/want to get out of renting for one reason or another (just got evicted for reons for the third time, just got evicted due to a sale, need a place to house the stray dog they adopted, etc.) Other trade examples are among the “must sells” and “must buys” ; get divorced or have anotehr child, and if you already own you might just be changing the equity, therefore the numbers can work for you (i.e, I bought my house for $25,000; I can sell it today for $1 million, but the super nice townhouse I’m retiring to so that I don’t have anymore landscaping costs $1 million. What do I really care about values if I’ve got my other needs covered? I’m just trading one house for a different type of house. The numbers are just numbers).