Monday, October 29, 2012

Freak out



For the past few days we have been showing you what could happen if panic sets in and people realize the bubble is starting to collapse.

There are lots of people who can - and will - move very quickly on price. And that's the one thing the real estate industry doesn't want you to do.

That point was driven home on the weekend by Peter Simpson, CEO of the Greater Vancouver Home Builders Association, who was headlined in this Vancouver Province article urging people: Don't fret or freak out, says homes veteran.
Peter Simpson wants to offer reassurance to new Lower Mainland homeowners worried about the shrinking value of their houses. Don't be dazzled or depressed by price changes. They go down, then they recover and rise over time, he says.
Clearly the industry is worried about people who are keeping close tabs on things.
Simpson believes people only hurt themselves if they become obsessed with tracking week-by-week house price changes. "They should not consider their home and its value as a pork belly future," he says. "That causes a lot of people angst. "Live in it, enjoy it and if you have to move somewhere else, sell it and move on."
If you must worry, Simpson wants you to channel you energy into helping his members develop more properties into high density housing: 
If you must worry about something, worry about the resistance from some people to letting their neighbourhoods evolve into a mix of single and multi-family housing, Simpson says. Densification is the key to providing affordable housing choices as the Vancouver region grows, he says. "We have to start building more high-density housing along arterials and even up side streets in existing neighbourhoods."
What ever you do, don't let affordable housing choices come about by letting the value of properties slide.

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12 comments:

  1. "They go down, then they recover and rise over time, he says."

    Like the NASDAQ!

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  2. Wow, what a bunch of self-serving garbage that was!

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  3. "Live in it, enjoy it and if you have to move somewhere else, sell it and move on."

    Tell that to the many condo owners who are already finding themselves 20% underwater on the mortgages.

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  4. Clearly the guy has no logical ability at all. What a joke.

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  5. "Don't be dazzled or depressed by price changes. They go down, then they recover and rise over time" ~~Peter Simpson

    Sorry to say it but Peter is wrong this time. There is nothing about this current market that even vaguely resembles the past 30 years of ups and downs. We in Vancouver embarked on a parabolic rise in SFH prices beginning in 2001 that is now in the process of being rationalized back towards normalcy. We are so far off our natural inflationary trend line it is astonishing that Peter would suggest (with a straight face) that this is just a typical up and down move that will see a recovery before the next up-phase. Twenty or thirty years ago his advice would have made sense but todays situation is a very different beast by an order of magnitude. Any damn fool paying attention can see that this is a market headed for a steep correction on the way to returning prices to the long term trend line. To say otherwise seems to be verging on the comical. As they say in the business,.... past performance is not indicative of future gains.

    http://vreaa.files.wordpress.com/2010/09/vreta-chart-0-lines.jpg

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  6. "Don't be dazzled or depressed by price changes. They go up, then they recover and lower over time"

    Works both ways

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  7. All of this densification/affordable housing nonsense is hype -- all part and parcel of the effort to stem price drops on single family property values.

    ie. "Geez, if they want to build row houses in the middle of the street we really must be running out of land"

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    Replies
    1. It sounds to me more like Mr. Simpson is attempting to keep the home building merry-go-round at full speed

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  8. If I had a house in Vancouver, I'd cash out now and make the million and I'd be pretty much set for life. When else can you make that much money?!? It's like winning the lotto! If you can make a million now, why wait? You might end up making 1/2 a million in a few months. I wouldn't chance it!

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  9. "What ever you do, don't let affordable housing choices come about by letting the value of properties slide."

    Bwahahah! The funniest thing I've seen in days. Thanks!

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  10. Obligatory: http://www.youtube.com/watch?v=vKITpVovTAE

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  11. The only solution is more building and sales to speculators.

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