When do you think the Vancouver housing bubble will explode and come crashing down ?

[MaxVerstappen33]

Because a simple look at the charts guarantees it. Or not ? Is this time different ?

 

 

 

 

 

 

[Toni Zamboni]

hopefully the entire bc housing market crashes soon.....then i can buy!

[MaxVerstappen33]

17 minutes ago, Toni Zamboni said:

hopefully the entire bc housing market crashes soon.....then i can buy!

It will.  and maybe then, I will buy too. 

 

But apparently 40% of voters think this will go on forever. 

[mdehaan]

It's only a matter of time. Could be 2 years, or 5.

 

It will most likely coincide with the next global recession.

 

Speculation drives the market up and speculation will eventually drive it down.

[mdehaan]

2 minutes ago, LolClarkson said:

It will.  and maybe then, I will buy too. 

 

But apparently 40% of voters think this will go on forever. 

Theres only been 6 votes, kinda early to tell.

[Wilbur]

5-10 years imo.  As has been stated before, when the next global recession hits.  It's gotta be global though.

[MaxVerstappen33]

2 minutes ago, mdehaan said:

It's only a matter of time. Could be 2 years, or 5.

 

It will most likely coincide with the next global recession.

 

Speculation drives the market up and speculation will eventually drive it down.

Speculation drives it up but the crash is just reality setting back in.  It wont be speculation that brings back late 90's prices. 

[MaxVerstappen33]

4 minutes ago, mdehaan said:

Theres only been 6 votes, kinda early to tell.

Yeah true.  And some of the never votes will be made out of frustration.  But id like to hear the reasoning from someone who truely believes it

[nuckin_futz]

I doubt you see a crash. Probably a leveling off and and a long move sideways/moderately down. IMO the market is being driven by the top 15% of sales chasing each other. Those people are moving hot money out of other places and looking for a safe place to park it. It's usually those situations that create the conditions for a crash but those sales are being conducted in cash. So there won't be any mortgage trouble forcing those buyers' hands like there was in the states housing crash of 07-10. On top of that rates are low and will be for the foreseeable future.

 

I don't think it's purely speculation driving this market like in the charts in the OP. You do hear some stories of houses being left unoccupied but that's the rare case. Most people paying these inflated prices with cash are moving to Vancouver or at least keeping the homes occupied.

 

Market bubbles usually end the same way. The tops are marked huge price swings in both directions and volatility. The smart money gets out and the Johhny come lately's get stuck holding the bag in a liquidity vacuum.

[MaxVerstappen33]

32 minutes ago, nuckin_futz said:

I doubt you see a crash. Probably a leveling off and and a long move sideways/moderately down. IMO the market is being driven by the top 15% of sales chasing each other. Those people are moving hot money out of other places and looking for a safe place to park it. It's usually those situations that create the conditions for a crash but those sales are being conducted in cash. So there won't be any mortgage trouble forcing those buyers' hands like there was in the states housing crash of 07-10. On top of that rates are low and will be for the foreseeable future.

 

I don't think it's purely speculation driving this market like in the charts in the OP. You do hear some stories of houses being left unoccupied but that's the rare case. Most people paying these inflated prices with cash are moving to Vancouver or at least keeping the homes occupied.

 

Market bubbles usually end the same way. The tops are marked huge price swings in both directions and volatility. The smart money gets out and the Johhny come lately's get stuck holding the bag in a liquidity vacuum.

Quote

I doubt you see a crash. Probably a leveling off a long move sideways/moderately down.

So a plateau type formation  ?

 

Sept. 3, 1929: The market reaches its highest point before the Great Depression

At this time 85 years ago, Yale economist Irving Fisher was jubilant. “Stock prices have reached what looks like a permanently high plateau,” he rejoiced in the pages of the New York Times.

 

Apologies if I sound condescending but that is always what people say in bubbles. Show me a chart where this has ever happened. The market is clearly a bubble and it will crash. It has to.

 

Quote

but those sales are being conducted in cash.

A lot of people have been duped by the local speculative community, in typical Vancouver fashion.  Its unfortunate because the resentment that's building against the scapegoated "Chinese" community in Vancouver is really getting nasty. There is very little actual evidence that the bubble is being fueled by cash. Lots of Chinese were buying in Vancouver in 1997 when Hong Kong was turned back over to the Chinese. There are some Chinese who are cashing out of that real estate.

 

Either way, most bubbles comprise of cash and borrowed funds. Cash sales do not change anything after the speculative bubble gets this separated from fundamental valuation metrics. The delusion will end and market fundamentals with rear their head.

Quote

So there won't be any mortgage trouble forcing those buyers' hands like there was in the states housing crash of 07-10. On top of that rates are low and will be for the foreseeable future.

That is simply not true. There are lots of borrowers in the market. So to say there won't be ANY mortgage trouble is disingenuous. 

 

And as we can see here, interest rates continued to fall all through Japan's real estate bubble/crash. Low rates did not prevent anything.

 

Quote

I don't think it's purely speculation driving this market like in the charts in the OP.

 

Anytime an asset divorces itself from any fundamental metrics by a factor of 5 or 10, it can only mean speculation.
 

Quote

Most people paying these inflated prices with cash are moving to Vancouver or at least keeping the homes occupied.

 

That proves that there is way more local speculators in the market than people want to admit. And again, lots of bubbles are built on cash money.

[-Vintage Canuck-]

Probably five years from now.

[MaxVerstappen33]

2 hours ago, Wilbur said:

5-10 years imo.  As has been stated before, when the next global recession hits.  It's gotta be global though.

Using a global metric, it would be very unorthodox for this current expansion to last 5 more years on top of the 7.5 years that we are already into.

 

 

And then if we use a stock index in the US as a feeler, it would be even more unexpected to add another 5 years to stock market expansion that is already the 2nd longest since WW2

 

As BofA's Michael Harnett reminds us, on Thursday, April 28th, the US equity "bull market" becomes second longest ever. Next Thursday the current bull market will be 2607 days old, exceeding the bull market of June 1949 to August 1956 by one day; the longest bull market ever was October 1990 to March 2000 (3452 days).

 

 

I am of the opinion that the next global recession is already upon us and has been for some time now. It is just that the Keynesian central bankers, corporatist propaganda in the financial media and political hacks have been successfully hiding it like they usually do for awhile.

 

So yeah. I agree that a global recession could have implications on Vancouver real estate. But I can say with certainty that the next global recession is not 5 years away. It is now. 

 

World stocks are already in a bear market.

 

World container shipping traffic is at record lows.

 

 

 

 

 

 

[Warhippy]

I like this thread.

 

I'm guessing 2 maybe 3 years tops.

 

There has to be movement made first.  US rate increase coupled with China finally firmly clamping down  on the exodus of private cash is a serious indicator.  Without factoring in the complete shut down of their industrial presence due to low purchasing overseas 

 

But more locally we will see the government intervention and low rates finally curb things via  legislation at provincial and federal levels plus a 1%-2% increase over a year will be the catalyst 

 

Can't wait 

[LordCanuck]

Never, Demand outways Supply by a high margin. It may flatline or decrease by 10% but thats small time now with prices being this insane.

[M A K A V E L I 96]

I don't think you'll see the type of crash you're talking about where homes that are worth $1 million now crash down to $300,000. What's likely to happen is the current ridiculous rate of increase stops and you have a minor dip in prices.

[MaxVerstappen33]

5 minutes ago, M A K A V E L I 96 said:

I don't think you'll see the type of crash you're talking about where homes that are worth $1 million now crash down to $300,000. What's likely to happen is the current ridiculous rate of increase stops and you have a minor dip in prices.

Crashes are never expected before the fact. Prices are so divorced from fundamental reality compared to other parts of the world that we can safely call it a bubble. If we can establish that it is a bubble then we can rule out the idea of a plateau or a slowing of the price spike.

[MaxVerstappen33]

33 minutes ago, LordCanuck said:

Never, Demand outways Supply by a high margin. It may flatline or decrease by 10% but thats small time now with prices being this insane.

Demand from population growth ?

 

[SamJamIam]

17 minutes ago, LolClarkson said:

Demand from population growth ?

 

Demand from foreign markets.  If I could buy a shoebox home in Hong Kong or a mansion in Vancouver, I'd do the same thing and buy here.  This is just what happens when a massive economy like China is artificially restricted by its government.

 

And counter to the claim that a global depression will cause a slow down, it will likely do the opposite.  People are trying to get their money out of China because its economy is slowing down and the government is trying to devaluing their currency to keep their industries competitive.  That means everyone's savings could get a massive haircut so as the Chinese government clamps down, it's going to push more money into our housing market.

[JV77]

Will cool off and stable but I don't see a dramatic drop at all.  Then probably up again, it's a cycle.  Prices have never dropped in the 25 years I have lived here.

[SaintPatrick33]

Everything is a cycle, but since the 70's, Vancouver has been one of the most costly cities to live in. Costs have continued to go up, while income failed to keep up.