Like stocks, global real estate is also in a bubble spurred by easy credit, but is bursting in different areas at different times, Harry Dent Jr. said. He has been renting a home in Tampa since 2005 as he waits for the battered Florida market to bottom before buying. “The home I have been renting for six years has fallen at least 40 per cent, and I am expecting another 20- or 30-per-cent decline.”
When an asset bubble bursts, prices often return to where the rapid, price runup began, he said. “Look at what your real estate was worth between 1996 and 2000. That is the range it will fall to … I think housing in Vancouver and Victoria could decline 60 or 70 per cent, while Toronto is more like 50 per cent, and Montreal a little less.”
- from ‘Get set for a crash, forecaster says’, Globe and Mail, 10 Jan 2012
Noted here not as an endorsement of Mr Dent as an analyst, but rather to mark the fact that the Globe and Mail has actually put into print predictions of RE price drops this extreme. They’re more extreme than our own modest 50%-66%-off predictions for Vancouver.