Judging by current blog discussions, there are a good number of non-owners exhausted and demoralized by Vancouver RE price action. This from scullboy at vancouvercondo.info Oct 2nd, 2009 at 11:29am -
“I’ve given up trying to figure out this town…. I’m giving it a couple more months, then I’m packing it in for somewhere else. I’ve spoken to a lot of people between 35 – 45 who are saying the same thing….. “Yeah it’s pretty but I’ll never be able to afford more then a 2 bedroom apartment I’ll have to share with a roommate.” My own roommate is preparing to leave. He’s in construction. He runs fiber optic cable through new buildings. He was saying the whole construction industry is set to dry up completely after the Olympics. It’s sad but to be totally blunt, I don’t think natural born Canadians can move to Vancouver and compete. Guys like Supraboy [another poster] can because they live with Mummy and Daddy but that’s hardly competing, it’s just extending adolescence indefinitely. ……I’d say the city will collapse in on itself when all those 35-45 years olds migrate somewhere else, but after three years I can’t figure out how Vancouver ever functioned as a city. There aren’t a lot of head offices. It’s expensive to start a business here. Except for construction and tourism, there just aren’t many industries to support the population.”
I am in real estate and I can tell you for certain that most of the recent sales have been to ‘natural born Canadians’, unlike what your whiney posters says.
Most are moving up due to lower rates and ironically many of the sellers are overseas investors cashing out after years of owning. If you had access to the realtors MLS info you would see that.
Are they over-extending themselves, maybe some are, but they are still buying.
Simon – Thanks for the comment.
I agree with you that the vast majority of Vancouver RE sales (>95%) are to ‘natural born Canadians’.
scullboys comment was quoted here in the spirit of this blog – to show how some people are thinking and feeling about Vancouver RE, such that we can better understand the whole picture.
And to be fair to him, you are talking about ‘natural born Canadians’ ‘moving up’ (which I take it means they are selling Vancouver RE to move up), whereas he is talking about how hard it is for similar folks to move here from elsewhere.
You’re in real estate and doubtless you know things that people outside the business are not privy to. If you have some specific illustrative anecdotes, please post them here (disguise some features if you like) and I’ll headline them for others to read.
It’s not oversea buyers driving Vancouver real estate. Their is no reason to be in Vancouver real estate if you are a foreigner. Vancouver’s geography is gorgeous, but it’s not an international destination.
That is a quote that I have heard over and over. But it’s never been supported.
The proof in the pudding was the crash last fall. If international buyers were driving the market, then Vancouver real estate would have plummeted. But it didn’t. In fact it rebounded.
Do you really think there are a bunch of foreigners talking about Vancouver saying “hey the most bubbliest real estate market in the world is about to rise even further despite the great recession. I better jump in now before I’m priced out.”? Translate into Chinese and see if that makes sense. Let’s face it, noone is talking about Vancouver internationally, most don’t know where it even is, except for the handful that know it as an overpriced city.
The only ones who believe Vancouver will continue to rise is well, Vancouverites. You have talked yourselves into it. That’s a classic definition of a bubble.
The market will fall. But as a rule, and this is also used by Mish and other great bloggers, is that it will only fall when the almost all of the bears have desperately jumped into the rising market. At that point it will reach capitulation, and the market will crash. Markets rarely crash when everyone is expecting them too. Nor do they ever soar when everyone expects them too. So watch your friends, and realize that with each act of desperation, the market will approach its the moment of truth.
Jonathan:
Agree completely with everything that you say here.
Bear capitulation has been apparent on local Vancouver RE boards these last few months, both in deed (some bears have bought), and in sentiment (many have sounded desperate and have been driven to consider that they may have been wrong all along — in short that “this time it may be different”. We know that it won’t be.).