‘John V’, who appears to be planning to sell his Kerrisdale home, has this to say at yattermatters.com 2 Jan 2010 1:57pm -
“I think the market pushes higher into spring as inventory drops to zero (and I am talking only West side here).
Driving around I don’t see a lot of new houses ready to come on the market, however I have seen some lots sold in May-Oct coming back on the market as builders are looking for quick flips rather than tying up more capital to build new houses. This will only serve to delay any new house inventory.
People thinking of moving up are staying put, cause prices are just too insane to contemplate selling for $3M to buy $4M, so dont expect a lot of mid-tier investory [sic] either.
That leaves estate sales and sales from people will to leave the Vancouver market all together. And that aint much.
So with huge demand and diddly for inventory prices go higher until current owners finally capitulate and sell to realize huge gains.
We aren’t selling yet but when I think we can clear $3.5M (after fees) we likely will. 10% to go …”
Pretty classic. Prices treble or more over ten years, and the players are still holding out for the last 10% of gains.
How many other (thus far invisible) sellers are in this situation?
Many are sitting on large, life-changing paper gains and feeling sure that they’ll be able to realize them.
What will their response be when prices instead stagnate, or begin to drop?
‘John V’ may get his timing right, he clearly has his finger right on the sell button. But the vast majority of those planning to sell will not realize their imagined gains. It’ll only take a very small percentage of people trying to cash out at once to crash prices from these heady heights. Wait too long and… it could be ugly.
Those ‘$4M’ Kerrisdale homes will sell for $1M – $2M in the coming bear market. -vreaa