If you read Part 1 and don’t think you’re a real estate bull, then maybe you’re bearish on the Toronto real estate market. How can you tell?  Here are a few signs to look for to determine if you’re a bear:

You know you’re a bear if thoughts like these cross your mind……

1.You’re of the opinion that prices are going to decrease by a lot in the near future;

2.You think that most homes aren’t worth their list prices, even after they sell for higher than their list prices;

3.You find yourself saying “they overpaid for that house” about almost every house that sells;

4.You believe that the economy is going to falter and that the resulting job layoffs and significant mortgage rate increases will burst the real estate bubble;

5.You don’t understand why  someone else is always willing to pay more than you for every house you bid on;

6.You think you have a chance in a bidding war when you offer less than list price because that’s a fair price in your mind;

7.You’re willing to wait until you can get a good deal on a house; and

8.You’re hoping to time the market perfectly and buy when prices are at their lowest.

If this sounds like you, be careful not to get your hand stuck in the honey jar (and stop hibernating from real estate reality) because you’re probably a real estate bear. 

What are the pros and cons of being a bear?

Pros: You may eventually be right and buy your home at a lower price. You’ll look like a genius because it’s almost impossible to time the market perfectly.

Cons: You might have to wait a long time to buy a home. You’ll invest a lot of time looking at and making offers on homes. If prices are rising, it’ll cost you increasingly more for the house you want as time goes by and you wait for prices to fall. You may even run the risk of being priced out of the market. If you sell first to take advantage of a hot market and plan on buying when prices fall, you might end up renting for a long while. You should also be prepared for the possibility that the house you wanted to buy could eventually be out of your price range if prices continue rising as you wait for them to fall. If prices do eventually fall, you still may not find the home of your dreams because the selection of homes for sale will be slim since most owners prefer not to sell when prices are low.

Doesn’t sound too appealing to be a bear in this market, does it? It’s actually pretty risky. So if you’re not a bull and you don’t like the sound of being a bear, maybe you’re a regular person. Find out in Part 3, up next.