ABOUT THAT OVERVALUED REAL ESTATE....

 Oh it’s so easy to make predictions, and rewarding too.

Take the senior economist at TD, interviewed by numerous media after she predicted that the Ontario (and Kingston) real estate markets were overvalued by about 10 per cent and due for a correction.

  Think about it – if predicting the stock market or the real estate market were easy, we’d all be rich. The same economists have already had to “revise” last year’s predictions.

 But to make things very simple - ultra low interest rates have been leading scores of buyers into the housing market.

 That won’t last forever. Rates are expected to rise by mid-2013 – but wait. Even that is a prediction…

  But even if the housing market does what all markets do eventually, and pulls back some, does that mean Kingston homeowners have lost money or their homes are worth less?

   They have lost nothing they ever had in the first place.

  The ones bruised by any slowdown are those who bought at a peak. They may have to watch their home value tread water for a few years.

   The other casualty will be those who must re-finance at higher interest levels, after loading up on high-ratio mortgages when rates were low.

    Everything else will carry on and balance out.