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Realtors using the B-word in public.

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No, not blogger, bakery or bunion. I’m talking about a very dirty B-word when it comes to the BC market: Bubble. I’m talking about Realtors (not including Rob Chipman) using the word bubble or referring to the possibility of a downside for the market here.. Whether their purpose is to deny the existence of a Vancouver housing bubble, entertain the possibility or sound warning bells (hey, it could happen). It’s interesting to see how Realtors phrase any reference to a Vancouver real estate bubble and the idea that prices won’t keep rising like they have:

Duncan Browns market update May 2006:

My best guess is that this intense pressure on prices will force buyers to back off a little which could take the heat out of the market for a few months, while it adjusts. This kind of minor correction could be exactly what the market needs in order to sustain itself over the long term and prevent those infamous “bubbles” from bursting!

Jacob Krause blog entry March 2006:

Buyers putting up 5 per cent of the price of a home and mortgaging 95 per cent are doing the same things as stock market junkies snapping up securities on margin. The only way they make money is if the asset rises in value, and quickly. So far the 5 per cent-down crowd have done very well, since their extreme leveraging has paid off in a rising market. But if housing prices move in the opposite direction, their tiny little bit of equity can evaporate in a week or two, leaving them with nothing but a sea of debt. Oh yeah, and a home they “own.”

Tom Everitts anti bubble tirade September 2006:

I’ve been involved with this ‘bubble’ argument for so long, it is inevitable that the naysayers will be right one day. One day….but not now, nosiree…not a chance folks. Once again, during the lull that was August, everyone started throwing the ‘bubble’ word around again. ‘Ohhh, it’s coming this time’. ‘Ohhhh, all those people shouldn’t have bought’….’Ohhh, blah, blah, blah’.

So thats three random remarks made recently by Realtors in Vancouver.. Seen any other interesting remarks from people involved in the day-to-day business of selling homes here? If you’re looking for a place to buy is this a topic that comes up for conversation between yourself and your realtor?

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Anonymous

Browsing through a few Vancouver forums here in the lower mainland mainly frequented by immigrants from China, Taiwan and HK, I read some interesting views including the collusion theory in the industry and higher level. I was shocked to learn that many VW houses owned by mainland Chinese are divided in to self-contained units shared by 5 families.

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wannaget2calgary

"Seems like all you have to do is show these anti-bubble theorists the actual data."Nah, they're in denial. Some may be reachable in time, but others may never come to terms with reality.

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Anonymous

Seems like all you have to do is show these anti-bubble theorists the actual data. Increased inventory, reduced prices in many areas, US RE market problems and the B word becoming a common mainstream topic.

Anyone read CNN Money this week. They’re not speaking too highly of the RE market and its future.

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wannaget2calgary

"My sister is a realtor and insists there is no bubble" … Try the indirect approach. Ask her if there is a bubble of realtors, not real estate. In other words, did the promise of unimaginable riches create an unbalanced market where there is an oversupply of realtors for a diminishing number of buyers? Once she recognizes (a) that bubbles can exist, and (b) there aren't enough buyers for the current supply of realtors, she'll be half way there.

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Anonymous

That second quote from Jacob Krause doesnt seem like a bubble-denying one, it seems like a very candid expression of the fact that lenders are scraping the bottom of the barrel to find buyers. Read the whole blog entry thats linked from the front page, its very interesting.And I notice the third one was posted at midnight, it almost seems like he's drunk the way he rambles on about how there is absolutely no bubble. pretty funny stuff actually.

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betamax

“It is difficult to get a man to understand something when his salary depends upon his not understanding it.” – Upton Sinclair

My sister is a realtor and insists there is no bubble…everyone around her implies or baldly states that it’s a media fabrication. (Now that the b-word has gone mainstream, they can’t just blame ‘bitter renters’ anymore.)

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bc_cele

I like to run, if someone told me that it was bad for me then I'd tell then to take a hike. Doesn't seem much different.

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Anonymous

I’m a lawyer. At work this week, I received a flyer from some realtor who assured me there was no bubble and that prices would rise by 8% in 2007.

Shockingly, I remained convinced that there is a bubble.

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ken

I’ve talked to a realtor about the possiblity of a house price crash in vancouver before and they reacted a bit like number 3 there. I’m suprised the second is a realtors point of view.

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the pope

sawdust: I’m not sure, I haven’t seen any listing of Realtor blogs, I found the blogs that these quotes come from through selective Google hunting.

I agree that a realtors blog that shares ideas as well as listings could be a good way to find a realtor that you’d like to work with.

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sawdust

I think the whole blogging phenomena for realtors is interesting. Its great to see a range of thoughts on the subject, and something a little bit more from the heart than those stock responses that Cameron Muir of the CMHC always comes out with.

Do different real estate companies have central lists of agents with blogs? It certainly helps to get a sense of a realtors character. I personally don’t have a lot of faith in someone in any industry that says something can NEVER happen.

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