(archived from my forum posts today)
Remember yesterday I said I had heard from 10 people in the past few days saying they think Vancouver home prices will drop?
Well, make that 11.
Well, make that 11.
While chatting with my new landlord, he said “I think Vancouver home price will be dropping for next couple years, now that they removed the IIP. We were about to buy a $1M house in Vancouver few weeks ago, glad we didn’t. Vancouver real estate is not worth investing anymore” (landlord was from China but had been in Vancouver since late 1990s.)
There is the hard stats aspect of RE, things like Current Inventory, monthly sales, new lists, months of inventory, etc. These values are useful for retrospective analysis of already completed sales, from which we may have a glimpse of the near-term price movement should current market momentum stays course.
Then there is the soft “investor sentiment” aspect of RE which is difficult to measure. When my family, in-laws, friends, colleagues, even landlords who were previously adamant that “Vancouver RE will never go down” now have respectively changed their minds, “predicting” RE will go down and “advising” me to wait a bit before buying, it almost felt like they were all suddenly brain-washed in unison.
Then I realized that the truth is in fact the opposite. They were brain-washed by media and RE industry to believe that Vancouver RE was untouchable Because thousands upon thousands of Rich Chinese are coming. No matter how we attack their ideology with stats, figures, reason and logic, their belief in RE was immune due to the impregnable shield of HAM-delusion. After Feb 11, this HAM Shield Generator which was grinding along for 28 years had abruptly been shut down. The (perceived) backbone of Vancouver RE had been broken. What these ex-RE Bulls are experiencing, is a Crisis of Faith – and it can be terrifying.
Imagine them opening their favorite local Mandarin Chinese newspaper and finding the RE Headline that reads “Rich Chinese Now Abandoning Vancouver, Swarming Seattle Instead”. Hardly believing their eyes, they opened their favorite local Cantonese newspaper and found the exact headlines.
Feeling shell-shocked, they turned on their computers and surfed Hong Kong news instead. Lo and behold, both Oriental Daily and Sina Finance are putting the same news on their RE headlines.
Discouraged, they opened another window for China news, only to find China’s XinHua Net is printing the same news.
Not wanting to give up, they surfed to Taiwan newspapapers, only to find several prominent Taiwanese newspapers bashing Vancouver RE.
It almost seemed like the Entire World is against them…