Sensational headline no? Here’s the deal: The REBGV benchmark price for a Greater Vancouver house is $901,680. TD Bank economists have just released a report in which they predict Vancouver house prices to drop by a remarkably precise 14.8% in the next two years. Based on the current benchmark price for a detached home that would be a loss of $133,400.
Now I know that for most of you $133k is nothing, but for some of us that’s real money.
“A combination of more subdued job and household income growth, rising interest rates, the recent tightening in borrowing rules for insured mortgages and fewer first time home buyers are expected to be the chief culprits behind the slowdown,” TD says.
Vancouver’s real estate market will fare the worst in the next two years. TD predicts a 25.4-percent peak-to-trough decline in sales and a 14.8-percent pullback in prices by 2013.
Of course everyone knows that different housing sectors drop at different rates and TD is predicting the worst carnage in the Condo market. What do you think will suffer the largest price drops – west side houses or east side condos?
Hat-tip to Real Professional for the link.