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BC Housing Market Freeze

City of Vancouver
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It is interesting to see “business as usual”  quotes like these popping up from people who’s whole business has been based on expendable income, cheap fuel, and demand for new housing in cities.

At a recent Urban Development Institute event focused on forecasting the future, developers Rob Macdonald and Michael Audain were optimistic in their speeches to the anxious crowd of 1,100. They predicted the market in B.C. will return to something approaching normal this fall, although with a reduction from last year’s peak prices.

But others are less optimistic.

“We don’t think it’s coming back any time soon,” said David Negrin, the immediate past president of the UDI who heads the development arm of Aquilini Investments. “We don’t see it coming back until at least after the Olympics.”

globeandmail.com: Housing market in a deep freeze.

One developer is stated as having “survived” 5 housing market crashes since 1982, and that he feels that this isn’t a crash, but a “freeze”. This freeze is so deep that at a meeting of developers in Vancouver, no one was starting any new projects in 2009.

A Building Industry Recession?

1 in 10 employees in BC work in the construction sector, a figure that is startling for many. What will this freeze mean for those who’s livelihood is dependent on housing start-ups? Will the cost of renovations decrease as a result of having more skilled labour looking for work? These are short term questions, the long term is much more troubling, with Climate Change, Peak Oil and an uncertain economic climate on the horizon, even these forecasts of a rebound in the market could be overly optimistic. The “old models” of doing business, (i.e. those we’ve become accustomed to in the past decade) are no longer valid. Massive changes in community and social structure are required to transition our towns and cities into sustainable places to live.

BC’s Housing Ponzi Scheme is Coming Unraveled

In other news…

The average price of a home in British Columbia is forecast to drop 13 per cent to $396,600 in 2009, according to the B.C. Real Estate Association.

“The global financial crisis and worldwide recession will continue to take their toll on the B.C. economy this year,” said Cameron Muir, the association’s chief economist.

via Price of average B.C. home pegged to drop 13 per cent.

The article finishes with a flourish…

The good news is 2010 is officially forecast to be a year of stabilization in the economy and the housing market, and Muir predicted home prices in the province would be relatively stable.

What a bunch of BS, I hope the author of this article reads the comments on CBC, here’s mine…

“Officially forecast to be a year of stabilization” sounds a little like propaganda to try to keep people from ditching the false economy of the housing market and economic sector that the government has allowed to rule above realistic expectations. After all, economy comes from the Latin meaning “management of a household” not “Ponzi Scheme”.

Everyone ready for a rocky downturn?

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Mike Thomas

Mike Thomas P.Eng. ENV SP, is the author of UrbanWorkbench.com and Director of Engineering at the City of Revelstoke in the Interior of British Columbia, Canada. If I post something here that you find helpful as you navigate the world of engineering, planning and building communities, that’s wonderful. But when push comes to shove: This is my personal blog. The views expressed on these pages are mine alone and not those of my employer.

2 thoughts on “BC Housing Market Freeze

  1. I strongly agree with the term "freeze" that discribes the housing market. I have townhouse development in Surrey and we sold four homes in the last three weeks. Having said that, we had a majority of the people saying that they are waiting until the end of the year to buy. Once inventory levels have returned back to a balanced market you will see a mini housing boom. Watch for the sales volume going up but prices staying the way they are in the third quater of 2009.

  2. Well, having sold in Santa Monica just before the prices crashed, and then moving to Vancouver, where we are choosing to rent for a while, I can say to Allan that we fully expect the prices to drop that 13%, and won’t really be looking to buy until it does. We are well positioned to buy, and there is no downside to waiting as long as it takes for the prices to come to a level that we feel is appropriate. I tend to favour the majority of non-developer opinions that think the prices will fall significantly – though I sympathize with your hopeful prognostication.

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