Boomer-aged Investors At Risk!

“We’re in a housing bubble,” says Hilliard MacBeth, an Investment adviser who did some research and believes he’s garnered enough evidence to prove his ‘theory’.

Over the years, Hilliard MacBeth has been one of the best analysts in Canada as he often predicts certain events that are likely to affect the market, both favorably or unfavorably.

However, he didn’t expect the first leg of the decline to transpire in his own backyard. He just had to drive around Edmonton, which is just three hours away from his hometown of Calgary, to see what happens when the cracks in an overheated real estate market start to show.

“It’s strange,” MacBeth says. “I can see it happening.”

Hilary MacBeth who is also the author of ‘When the Bubble Bursts: Surviving the Canadian Real Estate Crash’, expects residential values to ultimately fall back 40% to 50% from their peaks. Houses in Alberta have already done that.

MacBeth decided to focus on real estate after managing a number of clients, mostly high-net-worth baby boomers, began buying second homes and investment properties.

“I remember one conservative client whose daughter was going to university and they bought a condo for her,” he says. “I couldn’t figure out why they would buy one for four years instead of getting her to rent.”

This scenario has repeated itself over and over.

“People were convinced that this was the best investment because real estate always goes up,” he added.

He says that he refuses to sell his own property to prepare for another market crash. His house was purchased in 2010 and he spent a hefty amount to renovate it. MacBeth regards it as a lifestyle choice.

“No permanent wealth is created in a housing bubble,” he says. “Don’t view a house as an investment. Think of it as a place to live.”