This is a Business Week article from the United States and it pretty much sums up what is going on there. Is this what we can expect in Canada in the near future?? It's to early to tell, but I wouldn't be surprised. A lot of people in Canada are still pretty positive about Real Estate, and others are a little pessimistic. It's really hard to gauge what is coming next.
"Home prices still have room to decline, and it may take 15
years or more to reach new inflation-adjusted highs ""Housing prices were pushed up in part by get-rich-quick speculation. Now real estate has lost its grip on the public's imagination"
"Housing booms are short and exciting. Housing busts, on the other hand, are
long and painful. So don't put much faith in those oft-heard assertions that the
worst is already over. Prices are likely to fall further in many markets in
2007""A BusinessWeek analysis of the past three decades shows that if history repeats itself, it's likely to take 15 years or more for many parts of the country to get back to their inflation-adjusted peaks."
"For residential real estate, the outlook for 2007 ranges from mildly positive to awful. "
"Advice to homeowners: If you need to sell and you're not getting much interest, cut the price by an extreme amount. If you make halfhearted cuts, you'll remain overpriced and you'll follow the market all the way to the bottom."
"Advice to buyers: Bargain hard. Many sellers are still asking for too much. "As tough as our market's been, the toughest thing is to get sellers to understand that prices aren't going up 18% to 20% a year anymore," says Ned Redpath, head of Coldwell Banker Redpath & Co. Realtors in Hanover, N.H."
"THAT SAID, RIGHT NOW is not the ideal time to buy or move up, even with the recent price declines. The inventory of existing homes shot up 34% from October, 2005, to October, 2006, and now stands at nine months' worth of condos and seven months' worth of single-family houses at the current rate of sales. That backlog will take a long time, and a lot of price-cutting, to clear out."
3 comments:
You won't have to wait 15 Years to buy.
Housing may bottom out in the next 2-3 Years then it may take up to 15 years for them to come back up.
Read the article again. The 15 years is for inflation-adjusted prices (real prices) to recover to the peak. I think that's too optimistic for Vancouver (or for the real US bubble markets) - I do not see real prices in Vancouver recovering in my lifetime.
I expect the bottom shortly after the Olympics, when the last optimist will give up hope.
Yes, the article even talks about looking to buy right now. That might work for certain US markets.
Up in Vancouver, its hard to pick the perfect time to buy. If things drop 20% of nominal value in the next 2 years, I can't see too many problems with buying at that point, if you're waiting around for it.
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