End of the week

My last post drew some significant reactions which I expected.

Nothing has divided this city, or caused anger as much as this danged RE bubble.

We have many 'hot-potato' political issues, but they pale in comparison to this one issue.

We have so much tied up in it, on both sides, both emotionally and financially.

Many bears have their marriages on the line as they stayed out of the market and watched speculation drive the price ever out of their reach. Other the hand, I know of buyers who are maxed out due to the insistence of one of the spouses to get into the market NOW and there will be problems if the price drops and they get into negative equity or lose the ability to pay the huge mortgages.

Such is the result of a bubble. Make a note future politicians and policy makers. It is not something to be proud of, but something to try and deflate as soon as it shows up.

I remember the same thing happening in California five years ago. prices got so high, that even in middle-class areas, none of the middle-class folks who worked in the community and were an essential part of it..eg teachers, police, fire-fighters, nurses etc could afford to live there. They would commute in from cheaper areas. The same can be said of Vancouver.

I also remember the dot-com days, where some young high-tech folks were made instant millionaires due to stock options in the latest crapola company (long since bankrupt) while their colleagues in other fields worked just as hard and had very little to show for it.

Lots of bitterness and anger around too. This is the social result of a bubble.

OK lets see what May brings.

I suspect April may show a small drop in prices. Larry Yatter promises to have the numbers out first. We have the winds of HST, CMHC, Mortgage rates and excruciating lack of affordability blowing in the face of prices. We still had strong sales in April with some buyer panic, which is inexplicable in the face of rapidly rising inventory.

I also have the feeling that price strength is narrowing down to the choicest neighbourhoods. A marker of divergence.