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Will inflation keep boosting Canadian house prices? Don't bet on it


By Patrick   Follow   Tue, 20 Nov 2012, 1:50pm PST   186 views   0 comments
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http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/will-inflation-keep-boosting-house-prices-dont-bet-on-it/article4792362/

The advice is simple: If youre a first-time buyer, forget all the talk of a potential housing correction and jump into the market. Inflation will be your friend. Setting aside the reality that the bond market has firmly rejected the notion that a high inflation environment is coming soon, lets take a closer look at the relationship between inflation and house prices. It is true that real estate has historically provided a hedge against inflation. In other words, as inflation pushes up the costs of goods and services, real estate values have risen with it.

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