The general feeling in Alberta is that Real Estate is a tremendously safe investment and that even though prices are sky high they will continue to rise because of the fantastic economic conditions of the province. These economic conditions are mainly driven by oil and especially the Oil Sands Projects near Edmonton.
I know it is human nature to feel that when things are good that things will only get better – it’s called the Blue Sky Feeling. The other side of that is when things are bad one feels that things will never get better – that is called the Sky is Falling Feeling.
So when someone comes along and during A Blue Sky period and warns of potential storms on the horizon usually people call that person crazy. There were a few of these people during the Dot Com days and now there are a few of these people during these Real Estate Days. Donald Trump and Robert Allen and all those Real Estate gurus want you to spend thousands on their courses so they will never tell you the dangers of the Real Estate business. So just be aware that dangers do lurk in dark and ugly corners. Be careful!
Governments and World Events can quickly change the tide of Real Estate Prosperity. One company sounding the alarm already is UBS Securities Canada Inc. In an interview yesterday, UBS analyst Andrew Potter said the industry will have to absorb the cumulative impact of regulations aimed at reducing greenhouse gas emissions, plus possible federal and provincial changes to tax treatment of the projects.
You can read the rest of this in an article in the Global and Mail entitled: Growing political risks imperil oil sands profit, report says New pollution regulations, taxes cited.
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