Lack of jobs & affordable house, pushing some to leave

[Homeownertoo]

Well, Static (and anyone of similar views), you've made a career out of predicting real estate collapse and claiming that anyone who states otherwise, either here or elsewhere, is either a dupe or an industry shill. You might be right but it's time to call you on it.

No more seeking refuge in predictions that won't come to fruition for decades, as you have resorted to in the past. Such is merely the refuge of the feckless and, regardless of what I might think of you, I'm sure you don't consider yourself as such. So if indeed that label doesn't apply, you'll have to accept, for the sake of your own credibility if nothing else, that your predictions must be held to a standard of reasonableness rather than fecklessness.

A generous standard for such would be the longest term of economic decline experienced in living memory, that of the Great Depression. (I won't dwell on the fact that, in Ontario during the GD, unemployment reached 45%, or that in the US, housing prices have fallen by 30.5% -- as far as they did during the Depression, according to the S&P/Case-Shiller index, and what those facts mean for predictions of massive further declines.) The Depression troughed in 1933, four years after it began. So we'll take a four-year peak-to-trough time frame. In Kelowna, real estate started falling by mid-2008, nearly three years ago. That gives your crash another 18 months max in which to materialize. If if does, my hat goes off to you. But if not, a change of tune is in order, perhaps along the lines of admitting your reasoning was flawed and some analysis of where it went wrong.

You might not like having your views subjected to any kind of timeline, but if they are not to fall into the dustbin of unfalsifiability (and all that implies), then you have little choice.

PS. I am assuming that your prediction of "a real estate correction that will rival the worst in our history" is, despite the vagueness as to specificity, something rather more armageddon-like than a 30.5% decline from the peak, considering the local RE market is already well along the way to that point.

[twobits]

I'm cheering for Static 'cause I would love to be able to afford a house in this godforsaken town.
Sincerely,
A mid-20's family man with a wife and two kids that makes a respectable wage and has lived in Penticton his whole life.

I'm cheering for you too..... that you will be able to own your own home if that is what you want, and at a price you can afford. Talk to your own banker. He would not want you to fail if he is going to be the one lending to you. Banks do not like foreclosing as it's very expensive. Hoping for the slaughter that may not come for a good entry point has a flip side too. Time is on your side though as prices are not going to jump anytime soon, if anything down a bit.

[Static]

Prices are already down between 15-20% up and down the valley. It has been a horrible investment for a few years already. IMO i will be at least a generation before prices in the valley make new real records.

[Static]

Well, Static (and anyone of similar views), you've made a career out of predicting real estate collapse and claiming that anyone who states otherwise, either here or elsewhere, is either a dupe or an industry shill. You might be right but it's time to call you on it.

No more seeking refuge in predictions that won't come to fruition for decades, as you have resorted to in the past. Such is merely the refuge of the feckless and, regardless of what I might think of you, I'm sure you don't consider yourself as such. So if indeed that label doesn't apply, you'll have to accept, for the sake of your own credibility if nothing else, that your predictions must be held to a standard of reasonableness rather than fecklessness.

A generous standard for such would be the longest term of economic decline experienced in living memory, that of the Great Depression. (I won't dwell on the fact that, in Ontario during the GD, unemployment reached 45%, or that in the US, housing prices have fallen by 30.5% -- as far as they did during the Depression, according to the S&P/Case-Shiller index, and what those facts mean for predictions of massive further declines.) The Depression troughed in 1933, four years after it began. So we'll take a four-year peak-to-trough time frame. In Kelowna, real estate started falling by mid-2008, nearly three years ago. That gives your crash another 18 months max in which to materialize. If if does, my hat goes off to you. But if not, a change of tune is in order, perhaps along the lines of admitting your reasoning was flawed and some analysis of where it went wrong.

You might not like having your views subjected to any kind of timeline, but if they are not to fall into the dustbin of unfalsifiability (and all that implies), then you have little choice.

PS. I am assuming that your prediction of "a real estate correction that will rival the worst in our history" is, despite the vagueness as to specificity, something rather more armageddon-like than a 30.5% decline from the peak, considering the local RE market is already well along the way to that point.

Our economy is completely different today than the 30`s, I am unsure why you are comparing the two. Canada was under the gold standard until 1931, compared to the fractional banking system today. The latter is a system that allows for far more money to be created, and hence larger bubbles. I beleive this one will make records. I beleive the average house price across Canada will fall a minimum 40% (from peak). Kelifornia will fall by at least 50%, it half way there already. I also beleive that the 5-year floating rate will be at least 7% in 5 years from now, meaning I beleive the crash will occur (eventhough it has already started) within the five year time frame I said three years ago.

[irish61]

I was just looking at my job websites (i'm looking for work too) and I see that the City of Penticton has positions posted online at http://www.civicinfo.bc.ca/
I thought they just got rid of all whole bunch of employees? Maybe the ones left behind are all jumping ship? Anyway, they are hiring if you qualify!

[justthinking]

Did you see Global news tonight? A large development company brought in some buyers from China to view Whiterock properties and 6 sales resulted. That could be a trend that really catches on and if it does then people from the lower mainland could relocate to the Okanagan forcing prices up. Although our Real Estate is high I think by the standards of other countries excluding the US prices, Real Estate is an attractive investment. I do feel for people who have low paying jobs and no job security. Pretty tough to get that first home.
Another thing I have seen happen is when stock markets decline people pull their money out and put it in Real Estate. With the mergers happening people may just do that sooner rather than later just to wait and see what the effect of mergers does have on the market long term. I read an article today saying be ready to buy in a down market, but many investors will pull their money when markets are declining.

[Homeownertoo]

Our economy is completely different today than the 30`s, I am unsure why you are comparing the two. Canada was under the gold standard until 1931, compared to the fractional banking system today. The latter is a system that allows for far more money to be created, and hence larger bubbles. I beleive this one will make records. I beleive the average house price across Canada will fall a minimum 40% (from peak). Kelifornia will fall by at least 50%, it half way there already. I also beleive that the 5-year floating rate will be at least 7% in 5 years from now, meaning I beleive the crash will occur (eventhough it has already started) within the five year time frame I said three years ago.

So you don't think an 80-year time frame is adequate. Whatever, but those are hardly the only differences between now and then, just the ones you think bolster your case. But that's alright, I'm willing to give you the extra six months you claim to need.

BTW, your "a minimum 40% (from peak)" is quite a pullback from an earlier figure of 80% minimum. Hedging your bets already?

The clock is ticking.

[Homeownertoo]

Did you see Global news tonight? A large development company brought in some buyers from China to view Whiterock properties and 6 sales resulted. That could be a trend that really catches on and if it does then people from the lower mainland could relocate to the Okanagan forcing prices up. Although our Real Estate is high I think by the standards of other countries excluding the US prices, Real Estate is an attractive investment. I do feel for people who have low paying jobs and no job security. Pretty tough to get that first home.

Very interesting. I well remember what happened when the money from a single Asian city began flowing into Vancouver real estate markets. China is much larger than Hong Kong and brings many more dollars to the table.

[justthinking]

Did you see Global news tonight? A large development company brought in some buyers from China to view Whiterock properties and 6 sales resulted. That could be a trend that really catches on and if it does then people from the lower mainland could relocate to the Okanagan forcing prices up. Although our Real Estate is high I think by the standards of other countries excluding the US prices, Real Estate is an attractive investment. I do feel for people who have low paying jobs and no job security. Pretty tough to get that first home.

Very interesting. I well remember what happened when the money from a single Asian city began flowing into Vancouver real estate markets. China is much larger than Hong Kong and brings many more dollars to the table.

I thought it was pretty strategic marketing on the part of the Vancouver company. The Chinese were very impressed that the property was freehold as apparently in China much of the land is leased. Maybe there is another real estate boom just around the corner.

[Homeownertoo]

The Vancouver area is potentially extremely attractive to the newly rich in China. They consider it under-populated and paradisical by comparison, on many levels. There are also the political advantages of living in Canada vs. China. Of course, many Vancouverites would be appalled at the thought of a new Asian invasion, on many levels too. But since money talks, especially Chinese money these days, we should expect renewed political pressure to hike the immigration rate again.

[Static]

Did you see Global news tonight? A large development company brought in some buyers from China to view Whiterock properties and 6 sales resulted. That could be a trend that really catches on and if it does then people from the lower mainland could relocate to the Okanagan forcing prices up. Although our Real Estate is high I think by the standards of other countries excluding the US prices, Real Estate is an attractive investment. I do feel for people who have low paying jobs and no job security. Pretty tough to get that first home.
Another thing I have seen happen is when stock markets decline people pull their money out and put it in Real Estate. With the mergers happening people may just do that sooner rather than later just to wait and see what the effect of mergers does have on the market long term. I read an article today saying be ready to buy in a down market, but many investors will pull their money when markets are declining.

I saw the Global story and thought tom myself, "the market must be turning for the worse if they must have to use stories like that." Either way, it will not save the market from turning. I am uncertain about the stock market theory. It tends to be a leading indicator that real estate follows.

[Static]

BTW, your "a minimum 40% (from peak)" is quite a pullback from an earlier figure of 80% minimum. Hedging your bets already?

The clock is ticking.

Please provide a link for where I said 80%. You are most likely thinking of someone else. I have always beleived it would be between 30 and 50%.

[Homeownertoo]

BTW, your "a minimum 40% (from peak)" is quite a pullback from an earlier figure of 80% minimum. Hedging your bets already?

The clock is ticking.

Please provide a link for where I said 80%. You are most likely thinking of someone else. I have always beleived it would be between 30 and 50%.

Sorry, that was Rekabi's delusion. A 30-50% decline from peak is not out of line considering the dramatic runup in the mid-2000s, though I would mark the eventual decline at the lower end. The reason prices will not go back to where they were is that too many people are now invested in the higher numbers, meaning that adjustments will be made elsewhere (savings, consumer purchases, debt consolidation) to compensate.

[twobits]

BTW, your "a minimum 40% (from peak)" is quite a pullback from an earlier figure of 80% minimum. Hedging your bets already?

The clock is ticking.

Please provide a link for where I said 80%. You are most likely thinking of someone else. I have always beleived it would be between 30 and 50%.

Sorry, that was Rekabi's delusion. A 30-50% decline from peak is not out of line considering the dramatic runup in the mid-2000s, though I would mark the eventual decline at the lower end. The reason prices will not go back to where they were is that too many people are now invested in the higher numbers, meaning that adjustments will be made elsewhere (savings, consumer purchases, debt consolidation) to compensate.

I would agree with your assessment of an ave. 30% floor. Variability will also be large with respect to high end properties vs more modest housing. Much of that has been seen in areas already. I would however qualify that statment further to say that certain areas will not approach that floor and will rebound quicker than average markets as well. Areas that are desirable and where a large percentage of purchases are cash or not heavily leveraged. The definition of affordability changes dramatically when financing is removed or muted. The Okanangan is one such area that fits the description for me. The lower mainland for asians is another.

Home, I'd be interested in your view of the impact of generational wealth transfer. Specificaly boomers to their heirs which is just really beginning.

[jsytnick]

Prices are already down between 15-20% up and down the valley. It has been a horrible investment for a few years already. IMO i will be at least a generation before prices in the valley make new real records.

Oh at least a generation....Lol.