Last summer with all the rush to ‘buy now’ and steadily increasing prices in the Vancouver real estate market there was a prediction about house prices in 2010. Essentially someone took the rate that price were going up at that point and extrapolated out at the same rate to hit the prediction of an average house in vancouver going for one million in 2010. I must admit I also got swept up in the excitment with my bold prediction of condo prices reaching an average of THREE MILLION DOLLARS.
Unfortunately for us soothseers prices have actually been flat or dropping month after month since last summer, and its starts to get harder to see how we could ever hit that estimate.
So what are the conditions that could cause prices to shoot up again to hit that 1 mil in 2010 extrapolation? I’ve come up with a few:
1) Oil hits $4,096 per barrel. Flush with cash, the Alberta government buys a house in vancouver for every man, woman, child and house-pet in the province, whether they want it or not.
2) The Canadian government starts printing more money. LOTS more money. A loaf of bread costs $80 bucks and the fifty dollar coin is introduced into circulation.
3) Vancouver incomes double in the next year and more than half of them come with a rock solid 10 year contract and a lifetime supply of free bread.
4) Local real estate marketers develop a ‘mind control ray’ that convinces people they must ‘buy now or be priced out forever’. The ray also convinces banks and lenders to hand out loans that are 15x stated income.
5) Demand from planet Zegnbar skyrockets. The Zegnbarian exchange rate is so favorable that a Zegnbarian toenail clipping is worth about $460,000 CND.
Thats about all I can come up with on this Monday morning. Have I missed any?