“The threat of a bubble has largely dissipated,” senior economist Robin Wiebe said of Metro Vancouver. “But, really, there never was one.Actually, when the supply increases during a speculative frenzy, you just get more objects to trade with in a speculative frenzy. The laws of supply and demand left the building exactly when the increase in price triggered an increase in demand.
“When prices rise, new supply is attracted to the market. And that's what's happened.”
According to the index, the average price in Metro Vancouver was $774,000 in October, two per cent more than September and 15.3 per cent more than October 2010.A gain in excess of inflation is not balanced.
The Fraser Valley was in a balanced market, with prices up 9.6 per cent year-over-year to $494,000, but Victoria was considered a buyers' market, with prices down 7.1 per cent year-over-year to $490,000.Why is falling prices a buyers' market exactly? Sounds like a perfect wait for a better bargain market.
No mention of how much additional credit needs to be issued to sustain these gains "with sales of the expensive homes having moved through the system." (read: foreign $) and where that credit is going to come from to even match the recent gains ongoing. If the shift in buyers is real (they admit it is) where is that money going to come from?
Hat Tip: Smokin' Jayne commenting at VREAA