Sunday, December 10, 2006
it's (almost) over
I believe that it is all over, but for the tears.
I know we have the mountains. I know we have great weather (sometimes, anyhow). I know the Olympics are coming (are you as fatigued by the refrain as I am?).
It is different this time, of that there is little doubt. Never before has Vancouver seen such a dramatic increase in housing prices, in so short a time.
Never before has BC had such a negative savings rate (not in my lifetime anyhow).
Never before has the affordibility in Vancouver been so low.
Never before have there been so many amateur investors to drive up prices with such dreams of plump sugar plums dancing in their heads.
I am going by my gut here, but I do not think that we have ever seen price declines through the summer and fall - followed by continued increases in the spring, and I don't think that it will happen this time. Of course, I may be wrong - I thought that last spring would see a return to the trusty fundamentals, and I was wrong. We all were. Not this time though.
RET has dwindled to a couple of posts a week. Gone are the hard-headed bulls, and the bears are so breathlessly awaiting the reverse trend, that they have no breath to speak any more.
The farmer has locked the bulls in the barn for the winter, and the bears are sniffing about at the silage left behind, hoping for some food soon. It's coming.
I'm going to go out on a limb, and predict 25% declines in prices by this time next year, but it won't be over until we see 40% - 50% declines. Cocky, ain't I?