Friday, June 19, 2009

Anonymous said...
Who is buying? All I see is lay offs.

My response will be my week-end post:

This up-tick is sales was inevitable and to be expected with an historic low in mortgage rates.

It has stabilised the market. If it hadn't our banks would have followed the US banks into insolvency. The gradual drop has actually helped things, as it gives time for banks to tighten up and become more prudent with their lending and raise capital (both of which they have been doing).

It also allowed some people who were being stretched to breaking to refinance. Also a good thing.

I would be very surprised however if the whole BC market starts rip-roaring again though.

I still think we peaked late Summer 2007- early 2008. Since then the world has changed a lot. Our largest trading partner is having it's worst recession since the depression, large companies are down-sizing or going BK, and the credit bonanza that Wall Street created has gone taking many of the players with it.

To give you an example of how bad things are in California, a friend told me he was a co-owner of undeveloped land in Ca, that was listed three years ago for over $2.5M. They have been dropping the price, but no bids, until today when someone offered $250K.

We will find out soon exactly how 'different' it is up here.