Quote:
Originally Posted by Fighting Banana Slug
Honestly, looking at the various factors, how could it not burst? Even without the new taxes, just the extra scrutiny banks should be doing in that market could send that market tumbling. I don't think a 40-50% drop
is out of the question.
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It's interesting. In most housing markets, houses are homes: places for people to live. In Vancouver, the feeling has long been that houses are commodities.
If the latter is true (or largely true) then the housing market here should react the same way any commodity market reacts to bad news or uncertainty: people start to abandon the commodity in search of better, safer places to put their money.
I think any initial drops in the non-luxury market will be buoyed up in the short term by the large number of people living here who (still) are waiting to buy in, looking for a home. But for investors, it'll be much more a case of wait-and-see.
So, yeah, if it really is more of a commodity market full of investors rather than homeowners (if we distinguish "house" from "home"), then a pretty substantial drop could be coming, and the provincial and city governments keep poking it towards that ledge. I still think it'll be the interest rate that gives it the final kick though.