Wednesday, June 29, 2011

Canada's housing bubble deemed close to bursting



johnnyrent said...

The MSM have finally caved to overwhelming logic. Now, when will the government stop hoping against hope for a very gradually deflating baloon, while more property virgins get sucked into the morass, and pop this sucker?

DDO said...

Still though, there has to be an overwhelming motivation for a large number of people to sell their houses below the most current price for a similar home, let alone for less than they paid for it.
Raising interest rates might do it if they pushed enough people past their real affordability limits and towards bankruptcy. Otherwise only a fool would sell for less than they bought.
Also if the foreign/domestic speculative investor market was large enough in Vancouver it might cause a crash if they were forced to sell due to a need for liquidity. We should have seen this in 2009 but didn't really.
People have been predicting a major crash in this market since 2001 when it really took off.
I think the only correction is a flattening of the market which we're seeing outside of the over million dollar properties.