This is basic supply and demand. Economics 101.

Vancouver real estate is more expensive because WAY more people want to live here and move from other parts of the Canada and the World.

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I used to think that, too. Someone pointed out that in Vancouver's case, inventory has already exceeded any ability to suck it up. The unaffordability wall has been hit hard – it is almost meaningless now what inventory is. We've already passed a realistic absorption rate.

That's probably true, the inventory numbers now will become irrelevant. It's a new fiscal game.

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We're 2 years behind Phoenix (they peaked in spring 2006). In October of 2006, their inventory was 41k. This works out to 1 listing per 112 residents. Our current inventory is 20.5k, or 1 listing for every 123 residents. We might already be the Phoenix of Canada.

The Phoenix inventory peaked at 50k, so if we hit 27.5k, we will be at the equivalent of Phoenix's highest level.

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After the shit has been scared out of everyone on the planet, most will be willing to accept whatever global government voodoo plan is being offered. Most likely one that benefits few and enslaves most.

True. Seems most people can't connect the dots. This is a manufactured financial crisis – it was done, not by incompetence, but by design.

I had my 'lightbulb' moment back in 2005, right around the time I found VHB and HBB. I saw the banksters deliberately driving the bus off a cliff … then, figured they could come back to the taxpayer and make them pay for the privilege of being financially screwed. Then the next 'lightbulb' realization – when this all shakes out, probably the last thing on anyone's mind will be Real Estate.

When the banksters can do this for their own profit and amusement, what do you think they have planned for us down the line? People talk like real estate will bounce back in 2009 or 2010 and we will go back to business as usual and live happily ever after.

I'm pretty sure the intentional crating of the global economy will end badly (not for them, but for us). I could be wrong, but I'm not.

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Just asking…

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This is true historically however there is a decent chance of a protracted period of "reasonable" prices. The "I know lots of people who will buy when prices drop even 20%" — the so-called pent-up demand — argument really does ignore the investor component of the market who need properties to cash flow. These investors will inevitably set the price, much to the chagrin of the knife catchers.

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However, I wouldn’t completely dismiss the ultra-bear outcome for the following reason: SUPPLY. We now likely have about 3X as many downtown shoebox condos as we did in 2001, with very little population growth underlying it.

Supply, supply, supply. Too many shoebox condos out there. We are drowning in a glut of inventory. By next year, we will probably exceed 25K inventory for REBGV, and from there, who knows how high inventory will get.

Maybe we will be like Phoenix where inventory goes off the charts. Will Vancouver become the Phoenix of Canada?

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By the time it drops that far, and it will, most people will be scared sh*tless it will drop further, and many will be worried about keeping their jobs, let alone investing.

Look to the US for numerous examples of previously booming areas where prices have dropped 20% — no crowds are lining up to buy at 20%, though some have started to buy in where there are 50% drops — that's considered a bargain, though even that evaluation may change in time.

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In the long term, not the short term.

The more buyers you have in any market who are willing to pay more to buy than to rent, the more time you will spend in bubble territory and the bigger the bubbles will be.

But the bubbles will end, inevitably.

What this means is that in a place like Vancouver you can only get a reasonable price about 20% of the time. But wait for it, it will arrive again.

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The market isn't influenced by such arbitrary distinctions; it'll go as low as it goes. No one in 2001-2003 (or the late 1990's for that matter) was saying that housing was cheap at the time, so it could certainly fall to those levels — or lower, depending on the depth of the recession just beginning.

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