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sergei_makarov · 05-25-2011, 09:35 PM

What are people's thoughts on the real estate prices in Vancouver? With the average home price in Vancouver at $879,039 in April, and many people who rushed in before the changes to Canadian mortgage laws in March, is that market due for a big correction?

The Bank of Canada has been hinting for a while now that they will be raising interest rates soon and also received a recommendation from OECD yesterday to do it sooner rather than later. People with insane mortgages could be in for an unpleasant surprise when their monthly payments increase by $800-$1000 overnight depending on their loan.

My cousin is a surgeon out in Winnipeg and has always said she wouldn't be moving to Vancouver until after the real estate market crashes because it's simply too unaffordable and this is from someone who probably pulls in $200K annually alone (her husband is a director at a large company).

Is the market in Vancouver different simply because of the interest from Chinese buyers? What happens if China's economy dips and these investors look to cash out on their $2M investments for cash? China recently changed their own home ownership laws, tagging second properties with much higher taxation rates which has led to a dip in second-home purchases.

Home prices in Canada have gone up a lot across the country over the last 10 years, but the jump in the lower mainland is truly incredible. I can see the argument from some that a real estate crash in Canada is unlikely if they're talking about other cities, but I just don't see Vancouver sustaining these prices for much longer.

Thoughts?

05-25-2011, 09:35 PM	#1
sergei_makarov Scoring Winger Join Date: Nov 2010 Exp:	Vancouver Real Estate - Bubble or Nonsense? What are people's thoughts on the real estate prices in Vancouver? With the average home price in Vancouver at $879,039 in April, and many people who rushed in before the changes to Canadian mortgage laws in March, is that market due for a big correction? The Bank of Canada has been hinting for a while now that they will be raising interest rates soon and also received a recommendation from OECD yesterday to do it sooner rather than later. People with insane mortgages could be in for an unpleasant surprise when their monthly payments increase by $800-$1000 overnight depending on their loan. My cousin is a surgeon out in Winnipeg and has always said she wouldn't be moving to Vancouver until after the real estate market crashes because it's simply too unaffordable and this is from someone who probably pulls in $200K annually alone (her husband is a director at a large company). Is the market in Vancouver different simply because of the interest from Chinese buyers? What happens if China's economy dips and these investors look to cash out on their $2M investments for cash? China recently changed their own home ownership laws, tagging second properties with much higher taxation rates which has led to a dip in second-home purchases. Home prices in Canada have gone up a lot across the country over the last 10 years, but the jump in the lower mainland is truly incredible. I can see the argument from some that a real estate crash in Canada is unlikely if they're talking about other cities, but I just don't see Vancouver sustaining these prices for much longer. Thoughts?