It’s always interesting to see Real Estate ‘experts’ look at all the fundamental data but then somehow avoid the uncomfortable conclusion that housing prices will crash in Vancouver. -vreaa
A 20 Mar 2010 Vancouver Sun article by Michael Geller, a local architect, planner, & development consultant, compares Phoenix to Vancouver -
A 10-year-old, three-bedroom, two-bathroom detached home of 1,182 square feet that sold for $212,000 in 2006 recently went for $89,100.
In Carefree, just north of Scottsdale, a 4,400-square-foot, four-bedroom, four-bathroom house on an acre of land that features a 1,000-square-foot guest house, pool, movie theatre and elevator sold last month for $630,000. In 2006, it sold for $1.75 million.
Waddell [a Phoenix developer] lives in a spectacular 4,650-square-foot DC Ranch home that overlooks the sixth hole of the golf course. Like many Scottsdale properties, it is planned around a majestic great room with a huge entertaining kitchen. A variety of outdoor living spaces surround the pool and open-air fireplace. After seven years, he is ready to downsize; however, like many owners of luxury properties, he is having difficulty selling at a price that is less than what one would pay for a home half the size on a 33-foot lot in Dunbar.
As my plane was taking off, I calculated that Metro Vancouver’s median house price is about four times that of Phoenix. I could not help but wonder whether Metro Vancouver could ever experience similar drops in house prices.
While between 1980 and 1983 we did see some homes drop almost 50 per cent, I do not think Vancouverites will ever witness what has happened in Phoenix. For one thing, our banking system is very different, and recent changes will further control who can build and who can buy into the market.
Secondly, Vancouver’s land supply, unlike Phoenix’s, is constrained by the ocean, the mountains and protected agricultural lands.
[Note that the banks were just as responsible and the land just as limited during the 1980-1983 crash. -vreaa]