Friday, January 23, 2009

What now?

Rather than post a poll I figured I would post something new. So let's see how long I can stretch out this simple question. Here I go...

The Vancouver real estate market entered a severe slowdown in 2008. After a lacklustre spring market we reached a point at which the slowing sales and mounting inventory combined to end price gains. Prices have fallen every month since April (Benchmark SFH) and the economy has gotten far weaker since the "correction" began.

All things come to an end. The bubble has burst, and we will recover. However with the economic weakness bearing down on us, this year does not look good. Interest rates are falling rapidly which is great news for our market. Unfortunately, I don't think it's enough. There are far too many storm clouds on the horizon, and we may have to weather an economic hurricane before we see a rainbow.

Real estate has proven itself a tremendous value for long term wealth creation but it's not always the best time to buy.

How do you think this will play out? Will we get a dead cat bounce this spring? Will we flatline for a few years? We will rush to new price highs this spring? You tell me.