Forecast for the real estate market/p>
In the last few years, we’ve all read countless news reports that the real estate market is about to crash.
As far back as 2004, the Real Estate Board of Greater Vancouver published factual articles to get to the truth of the matter and to counter continued stories of doom and gloom.
So, once again, we’re trying to determine whether or not we’re in a bubble and if we are, if it’s about to burst.
For some answers, we went to Helmut Pastrick, chief economist for the credit union systems in two provinces – BC and Ontario.
Here’s what he told us.
A bubble requires two conditions:
A large amount of speculation.
“Neither of these conditions exist,” explains Pastrick. While some speculation exists in some markets, overall it accounts for only a small portion of activity according to expert sources such as Landcor Data Corporation.
When it comes to easy credit – there isn’t any given that lenders have stringent requirements in Canada unlike what we saw in the US leading up to their market crash.
Pastrick goes on to say that high prices are not necessarily a sign of a bubble. “High prices instead signify there is more demand than supply right now.”
What does Pastrick forecast for the next few years?
The market will continue to be active although there will be ups and downs.
The longer term trend in prices remains upwards.
Metro Vancouver will continue to be a prime location for Canadians and overseas investors due to our mild climate, clean environment and great quality of life.
Do you have a real estate question, contact me.
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