It seems like Metro Vancouver home prices are constantly on the rise, with no affordable end in sight.
But according to market analyst Ross Kay, Founder of Ross Kay Realty Consultants and creator of The Wealthy Homeowner programs, June housing data shows a meaningful drop that indicates bigger decreases to come.
“Every housing market has to have a deflationary period at some time, housing prices don’t go up forever and it’s the natural cycle of a housing market.”
LISTEN: Market analyst Ross Kay explains Vancouver’s impending housing bubble burst
Kay says a correction to Vancouver’s housing prices is inevitable, adding that the rapid rate at which prices are climbing cannot be sustained any longer.
“What’s happened here in Vancouver because of a series of circumstances is the bubble got really, really large. So in other words, a short period of deflation or stagnation, where housing prices stay level for a period of time, is not going to wipe out the size of the bubble.”
In other words, it’s going to take a continuous stream of price drops to pop Vancouver’s housing bubble, but when it pops Kay says both long-term homeowners and new buyers will benefit.
The average price of a detached Vancouver home has increased 16.61% in the past year, according to Kay, going from about $850,000 this time last year to over $1.2 million today.