Certainly there have been hyperbolic headlines with anecdotal content based on incomplete data over too short of a timeline suggesting indeed it is…although even then only sort of. The number of units sold may be falling, but are actual sale prices falling? And what is happening with the bottom 80% of the market? The 80% (by price) that 95% of us reside in.
The current situation is a bit like this series of images I snapped Saturday afternoon:
Am I about to be mauled here?
Clearly a viscious animal, likely a banned breed. Obviously I should tweet, post, rant & sell, etc.
Tick-tock, some time passes. I zoom out a notch…
Ah yes, perspective, the cat was napping, I am stirring, and the dog…the itty-bitty dog, he just woke up too and is yawning not snarling.
So is the market having a quick nap too?
Or is it a snarling beast about to go into attack mode and feast on the fat of the recent equity gains made?
From my perspective it is too soon too tell.
I know that we all need to live somewhere, that everybody I know that wants to be employed is in fact employed (BC has the lowest unemployment figures in Canada currently), so while the question of values rising or falling may be unanswered today – we are all going to keep on making our payments tomorrow and simply not sell if we do not need to sell due to some other external reason. And even if we need, or want, to buy…we might play a bit of wait-and-see game for a few weeks, or months.
I know that another 4,000 people arrived in BC this month, and another 4,000 are coming every month after this – for some time. All these people, they need dwellings in which to live. So while values may fall (or not), rents will not. And if supply fails to increase, if builder shelve projects and go back into the same wait-and-see mode they did in 2009, well then – get ready for (another) slingshot effect on prices.
In the meantime, it is simply too soon to tell what is about to happen. And in the absence of any solid and useful information my experience has been often the best course of action, is no action.
Odie, Flynn and I, we are opting for a bit more inaction.
I am not sure why am I laying on the hard deck, while the dog enjoys the comfy lounger…
Until next time.