“Canada’s hot housing market is beginning to cool off, Scotiabank said Wednesday in a new report, with average home prices expected to decline by about 10 per cent over the next two to three years.
Scotiabank economists warn that the housing price correction will largely occur in the Toronto and Vancouver markets.” …
“The Scotiabank report says that the balance sheets of Canadian households remain in good shape, with real-estate equity sitting at an average of 67 per cent. However, Canadians are still carrying high personal debt loads, and with their balance sheets so heavily skewed to real estate, they are vulnerable to a sharp price correction.”
– ‘Canada’s housing market cooling: Scotiabank’, CTVnews.ca, 8 Aug 2012
Metro Vancouver home prices may slip a bit over the next year, but don’t expect them to drop sharply, according to a report released Wednesday by Central 1 Credit Union. …
“Right now, we’re undeniably in a sales slowdown with substantial declines in sales over the past several months,” said report author and Central 1 economist Bryan Yu. “But we’ve also seen positive employment growth and continuing very low interest rates.
“We believe the supply side will adjust substantially. When prospective sellers see weak sales and pricing, they pull their listings. [Most] don’t have to sell. This balances out the supply side environment.”
Yu’s report maintains home prices in Metro Vancouver should drop more than five per cent this year before rising 2.9 per cent in 2013 and 2.0 per cent in 2014.
“A recent tumble in home sales coupled with a drop in headline prices have some wondering (hoping?), whether Canada’s longtime poster child for a potential housing price bubble is set to burst,” the report concluded. “While a weakening state of demand in Metro Vancouver makes short-term price drops a near certainty, we expect that declines will be both modest and temporary.
“Prospective sellers are expected to respond to weaker market conditions by curtailing listings activity, which will limit excessive inventory in the housing market. Short of another recession and large-scale job losses, market activity in the Lower Mainland is expected to be characterized by a relatively low sales and a flat-to-weak pricing environment.”
– from ‘Metro home prices will slip, not plunge: Central 1 Credit Union’, Vancouver Sun, 8 Aug 2012
As numerous savvy web-based analysts have already observed, these are the same guys who had previously reassured us that any falls at all were unlikely. Now that we’ve already had the falls they’re ‘anticipating’, they ‘predict’ they’ll happen. This is rear-view mirror commentary, and they’ll chase the market all the way down with their non-predictions.
– vreaa
Vancouver Real Estate Anecdote Archive 
Every month there is a new ‘prediction’ from these guys and every month they inch closer to the truth… Its easy to be right when you keep changing your opinion 🙂
As a former stock analyst, I can say from experience that the majority of these guys first look at what the market is doing, then make their prediction. If prices move, so will their prediction.
Yeah. Their predictions are worthless if one is a market participant with a genuine interest in trying to figure out future action. They are best ignored.
Baseless predictions on the way up, baseless on the way down. I guess a careful look at fundamentals is just too frightening for these guys to even contemplate.
Ha, ha. 2.9% in 2013, not 3% but 2.9%. Their calculations must be very exact. How can they be so sure that it won’t be 2.93%?
Indeed. At least the weatherman mainly sticks to near-term forecasts and puts in some mighty caveats when attempting the longterm ones.
I don’t want to pan all economists, as some of them are actually decent and useful. But the ones that make junk predictions like this…
So, Scotia means down 10% *annually* for the next 2-3 years eh? 🙂
HOW IS THIS LEGAL IN OUR COUNTRY?
If I had written nine or ten or eleven figures’ worth of loans that were used to buy gold or securities, and then I passed my days operating as a self-styled “market expert” convincing the public that I could predict with certainty the future prices of gold and securities –without disclosing my holdings– I WOULD GO TO JAIL.
Free speech is important, but we have rules and standards. You can’t use it in certain very destructive ways against a generally uninformed, stupid, and therefore vulnerable buying public.
You can’t say “fat free” unless it’s fat free.
You can’t say “I’m an Engineer” unless you’re an Engineer.
And you can’t say “put your money here” unless you also indicate whether you stand to gain, personally or professionally, if your chosen targets follow your instruction.
And yet somehow we have a loophole in Canadian law which allows these turd eaters to ghost-write “expert advice” articles for the mainstream media without any pretense of *not* manipulating the market. Or of disclosing their personal stake in the behaviours they are trying to drive.
I propose that the VREAA erect a “Market Manipulators Wall Of Shame”, and fill it with comments like these.
The criteria is simple: any public statement made about housing investment that would violate Canadian or US securities manipulation or disclosure legislation were it made about that type of investment instead.
I realize that that is a pretty big dragnet, since every single one of these douche nozzles owns a house or three. But that’s the point.
i like the idea of “Market Manipulators Wall Of Shame”, because the more naive people out there listen to them like they’re speaking the truth, but in reality they’re just making things up. and the reason they need to keep spewing out speculative ‘information’ is so that they can keep their jobs..
Scotia isn’t fooling anyone who has just a cursory knowledge of technical analysis. Parabolic price rises will reverse and settle below the beginning of the rise. Scotia knows, like all the banks, that we’re going back to the prices we had in mid 1990’s, and we may see this as early as mid year 2013.
“Scotia isn’t fooling anyone who has just a cursory knowledge of technical analysis.”
Read: they are pulling the wool over the eyes of 99.5% of Canadians.