Bubble or BS

Democracy

One of the great attributes of this country is that we get to vote. It is recognized in advance that amongst you there will be some who will argue that we have three and maybe more parties with political agendas that match your hopes and political aspirations.

Some Serious Laughs

Ballot Box 01

Having some fun on a sunny Vancouver day, the inspiration for this in house election was inspired by the Globe and Mail’s Investor Forum wherein a simple question was asked. “Are We in a Housing Bubble?”

Yes – No

Keeping it simple, for the purpose of this election the vote will be straight forward. If you believe there is a real estate bubble you will vote YES! If you do not believe there is a real estate bubble you will vote NO!

Persuasive Consensus

As with all elections there is rhetoric. In this election there will be some rhetoric that is good and some will be bad but, it will always nice and with no mud slinging. The beauty of this simple election is that you also get to tell us via the comments why you think either case prevails. The best part, you get to see everybody’s vote and you get to see what they think. Imagine if we could do this in a bona fide election.

Who’s Counting?

Elections are always so much more fun when there are no scrutineers. The final tally as we know, can only be determined after the fact. Until then it is supposition based on personal perspective.

To serve as example of how others have voted here are some snippets from the Forum’s comments to get you started.

What Others Think

  • Most housing watchers are saying we’re not in a bubble yet…
  • we are lurching from one bubble to the next
  • I think so.
  • some markets are at or near bubble status
  • Not even close to a bubble
  • When the median income can no longer afford to purchase an average home then you are in a bubble
  • Definately a bubble
  • The answer depends on where you live
  • look at the bubble question on a region-by-region basis
  • Absolutely we are in a bubble
  • the only bubble that exists is in the media
  • the Canadian real estate market is so overblown, so inflated
  • personal debt is at a record high
  • the real-estate people themselves are creating this bubble
  • the government was in denial about the economy, we were always in a bubble
  • we’ve grown mortgage debt by 132% since 2000. In the US over the same period it only grew 110%
  • Can anyone explain where the 15% down, 25-year mortgage went?
  • We are in a very dangerous situation when credit on mortgage applicants is so relaxed
  • Bubble? No doubt
  • Depends where you live
  • we are in some places
  • No we are in a consumer debt Bubble
  • The answer is NO.
  • Economists will tell you that they cannot state this with any certainty until the bubble pops
  • I would say that we’re close to bursting
  • That depends on the individual’s definition of a “bubble”
  • I think we are in a bubble.
  • Of course we’re in a bubble
  • it’s just that it has not yet “POPPED”
  • Who is tired of hearing the saying housing bubble?
  • *Courtesy the Globe and Mail Investor Forum

How Will You Vote – Bubble or BS?

About Larry Yatkowsky

Larry is a recognized real estate expert. A veteran professional, his experienced counsel leads Vancouverites in his west side community to place their trust in a man passionate about his work. Uncompromising ethics bring a balanced approach to realizing your real estate dreams.

When Life Moves You - contact Larry:

*Disclaimer: Statistics Courtesy REBGV. While believed to be accurate they are not guaranteed.
**Numbers provided may vary as they are dynamically posted by the REBGV.

Reader Comments:

achilles Says:
February 18th, 2010 at 3:39 pm

bubble!!

spaceman Says:
February 18th, 2010 at 6:13 pm

Yes a bubble and a big one, and a triple Tsunami will hit this summer that will wipe it all out.

I lived through the crash of 82, I have learned my lesson.

Inventory up 40% in Victoria, prices up 15%, rules changing to curb buying, HST and interest rates on the rise come July… the pin is getting very close…

davers Says:
February 18th, 2010 at 6:44 pm

It would depend where you are. I’m sure there are areas of canada where there isnt much of a bubble. However in Vancouver I think all the numbers scream BUBBLE!

best place on meth Says:
February 18th, 2010 at 7:35 pm

9.3 X household income – ’nuff said.

BUBBLE.

POP!

John Says:
February 19th, 2010 at 5:20 pm

Bubble – yes.

Pop – not so sure.

People who bought in 2005 renewing their 5 year term will probably get a lower rate than they originally had, and they’d be good til 2015. Depending on how fast interest rates rise, I think we’d still be in good shape. Prices might drop 15-20% in the next 2-3 years followed by a levelling off period, but I don’t think it will be quite the bloodbath some people are expecting.

Of course I could be wrong and prices will either fall hard or continue to climb..

Boombust Says:
February 20th, 2010 at 8:08 am

5 years out is a long time…but, a lot can and will happen before then to begin the slide.

They will not only renew their mortgages in 5 years, but they will be putting more money on the table when their places are well under water.

Bubbles by their very nature will burst. Every time.

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