Ding! Ding! – Round 2
If the experts are right, the BC real estate market is poised for another round of price increases. Round 1 started in January 2015 with overheated demand from offshore buyers coupled with a lack of inventory. Michael Campbell and Ozzie Jurock both point to current geopolitical tension in Hong Kong and Europe as a major impetus for Round 2 of a real estate feeding frenzy.
Some readers may be concerned, as I am, with structural weaknesses in the Canadian economy: record high household debt and the loss of close to two hundred billion dollars of investment in the Alberta oilfields in the past five years. In spite of these and other factors, such as massive government deficits, Canada is rated third in the world behind the USA and Germany, if safety (keeping your capital) is the main consideration.
The December VIREB statistics point to strong sales in Campbell River and the Comox Valley: dollar volume of sales up 91% and 60% respectively compared to last December. Remember, the November statistics also reflected an upsurge in sales, so the trend may already be under way.
In Vancouver and Toronto, and other world centres, property prices have less and less bearing on what the local market can afford. Planners and policy makers are playing a not-so-subtle word game when they speak of ‘affordability’, or ‘affordable housing’. I used to think that philosophy was a harmless field of study for old men. I have come to learn that philosophy is King, and unless you understand the metanarrative, you may just end up as grist for the mill. Most of Canadian land use policy is driven by the philosophy behind Agenda 21 and Agenda 2030 – both UN Initiatives. The vast majority of Canadians know very little or nothing about these policies which result in a very high degree of expensive regulation. To my knowledge the policies have never seriously been challenged.
Michael Campbell’s World Outlook Conference takes place at the Westin Bayshore, Vancouver, on Friday Feb 7 and Saturday Feb 8. It is also available online. We at Kutyn Property Services will be tuning in.
In next month’s newsletter we will be looking for inventory.