The “Bubble” Explained
Robin Wiebe is a Senior Economist at Canada’s Centre for Municipal Studies who recently discovered a strong statistical correlation between Chinese GDP and an overall outlook of Vancouver’s housing market.
From the early 1980s to 2009, subtle shifts in economic variables have presented correlations between Vancouver housing and Chinese gross domestic product. Weighing annual market, population, and employment growths over the past 30 years, Wiebe explains graphically that a recent drop in China’s GDP has sent a shockwave through Vancouver real estate.
If you Google “Vancouver Real Estate”, you might uncover a conspicuous link to the Huffington Post. Read on and you’ll be thoroughly educated on the housing bubble. At 29% behind last years’ sales, a general consensus is Vancouver Real Estate is at a momentary standstill, if not a drastic plunge. But, as the Chinese economy reportedly recovers from a 12-year-low in GDP, the comparative economic forecast could mean what some are calling the recent housing bubble deflation may be only a temporary shortcoming.
According to Tara Perkins and Brent Jang of The Globe and Mail, this quarterly struggle is showing hopeful signs of coming to a close. Perkins and Jang point out that Toronto and Calgary have also been suffering alongside Vancouver, highlighting that nationwide fixed mortgage rates are being lowered by 0.1% in Canada’s biggest banks as a reaction to a cooling market.
As the market is still up 33% since January, no one is expecting real estate to rebound this quarter. The spring pump isn’t guaranteeing more sales, but February’s dip has pushed down prices and rates, thereby opening doors to the possibility of a more aggressive market.
If you have any questions about the market or are looking to finance your new home, I am happy to be your Vancouver real estate agent and am always at your service and armed with the answers you need.