Hacker News Reader

Comment by meatysnapper | Hacker News Reader

In all fairness, Canada and Australia are more or less commodity extraction economies with catastrophically inflated real estate markets. Lower commodity prices could prick that situation and cause some jumbled jonathans.

View on HN

That is a huge generalization about the Canadian economy. Mining and oil is 8% of the economy. Less than manufacturing and less than services.

https://en.wikipedia.org/wiki/Economy_of_Canada

And 4% less than: real estate!

I would love to see a huge correction in Vancouver but many people have been born and died waiting for it to happen.

Apparently it's an acceptable outlet for dirty cash from shady foreign 'investors', http://www.theprovince.com/travel/Chinese+money+launderers+s...

This is disgusting. London is traditionally the home of money laundering. Sigh. New money has no sense of history.

How much of a correction you're looking for? a 10% sounds very feasible in a down market but a 50% hit sounds implausible esp. in the short run.

In 2008-2011 a 40-60% swing took place in many parts of the US. Arizona, Nevada, Florida all being at the top of the list. The number of foreclosures was devasting to those areas. Vegas, Phoenix etc. were hit extremely hard. Many folks placed keys in the mail box and just walked away from properties -- leading speculators and savvy home buyers to come in at rock bottom and buy their homes on the cheap.

History may not repeat itself but it definitely rhymes.

I don't know about the real estate market for each state you cited but if the market activities were driven mainly by speculation and short term flipping then a 50% dive esp. in a highly leveraged market sounds very plausible but it seems that Vancouver has very sound fundamentals to sustain the higher prices.

Not to mention Florida, Nevada, and Arizona had a housing supply glut where you will likely never see one in Vancouver in your lifetime.

> it seems that Vancouver has very sound fundamentals to sustain the higher prices.

Have you seen the pictures?

http://www.crackshackormansion.com/

Median house for a detached house in the "poor" east side is $1.28 million, $2.9 million in the traditionally more desirable west side. http://www.theglobeandmail.com/report-on-business/vancouvers...

Vancouver is actually one of the poorest large cities in Canada. Average income in Vancouver proper in 2009 was $43,911. https://www.biv.com/article/2014/9/trick-or-treating-planner...

All this means that Vancouver is the 2nd most unaffordable housing market in the world (after Hong Kong) http://www.theglobeandmail.com/news/british-columbia/only-ho....

Accordingly a housing is already so inflated that a 10% drop means nothing. Even a 20% drop wouldn't make things affordable.

Reply on news.ycombinator.com