The average house price purchased over the 5 month period is up by 30% ...

people must be getting larger families - kids staying at home and grandparents moving in and helping with the mortgage in return for care ....

;-)

I trust these buyers will have the foresight to pay for these homes within the 10 year frame before all hell breaks loose and the economy craps out again. (Predictions could be accurate??)
Oh yes, and renewable mortgages will be subjected to higher interest rates.
Look out for insurance costs-just one major disaster could seal the fate for many people who must obtain insurance to hang on to a mortgage. Those companies do not hesitate to raise rates rapidly.
And the higher the cost for a home-the higher the assessment-and the higher the taxes.
Sure hope wages go up to cover all increased costs.
Oh my, when wages go up-so does most everything else.
I quit-this is getting depressing.
Back to the early '80's. Lots of foreclosures-bankruptcies- rent controls-and nobody to buy- as who knows how long this downturn will last???
It really is a vicious circle-right???

If house sales are up by such a large degree, where are the people who are selling their houses??? Have they built new ones, moved into an old folks home, an apartment, or have they left town.

For every action there is a reaction, so in this case what is the reaction???

Won't our fine folks at BC Assesment Authority have a hey day with these figures.
This combined with the Mayor and Council's digging the City's hole a little deeper, we'll pay a lot more than a $200 increase in our property taxes for the tax year of 2006.

Actually if you look at the figures, the number of sales has dropped over the same period as last year. The houses which people are buying have escalated in price or they are buying more house, or a combination of the two.

There is another part to this which average figures don't show. Those at the bottom of the scale may not be able to participate in this buying trend towards more expensive houses. They simply cannot afford to move up. With escalating housing prices comes the need for constructing affordable housing. That's part of the reaction.

Also, just because the average sale price has gone up by 30% does not mean that the average assessment of those same houses has gone up by that amount. The two are separate. It is quite possible that as people see assessments go up, and they are itchy to move and have some extra cash or extra borrowing capacity because they are hauling more logs for the time being, that they buy a larger piece of real estate in order to make a 10% to 15% return on an investment for which they pay less than half of that in interest rates. The more money they can leverage that way, the better off they are, assuming the price goes up, of course. So, a bit of a gamble in the short term, and a major gamble in the long term in these parts.

It's sad to see so many people get caught up in the buying frenzy. The buyers themselves are creating their own frenzy. Most will find that a reasonably priced starter home will sell very quickly. So, all of a sudden, you need somewhere to move to. Probably a more expensive home.

So, off to the bank you go to see how much the bank says you can afford. Imagine that? The bank says that you qualify for a $190,000 mortgage. So, off you go shopping for a $200,000 home.

The reality is, you cannot afford a $200,000 home. If interest rates rise, if taxes increase, if insurance increases, if you gas and hydro increase, if your furnace goes, etc. etc. you are hooped. Or, if there is an interruption in your income. You are hooped. Did I say If??? How about when???

No room for error in this scenario. But, people are lining up to play this game. It's a great time to sell, but a terrible time to buy. Imagine buyers bidding $10,000 to $12,000 over the asking price and still not ending up the successful bidder. This is what is happening.

The threat of interest rates climbing and house prices esclating is motivating many to get into home ownership for fear of being left behind and not being able to afford a home in the future.

Of course, this is nonsense. But, this is so typical of human behavior, isn't it? After all, it's the people lining up to buy that is driving up the prices. When there is no one left to buy, then prices will come back down. Chester

Its all about the banks collecting more interest for the same piece of property. Eventually they will own all of our homes this way.

I figure North Korea sends a nuclear capable missile over our heads, or a major incident in the Middle East takes place that starts a market reaction and suddenly an over extended market is bankrupt and begging for a place to live.

The markets are about 40-50% overpriced IMO. Just enough for the banks to make a good profit while playing on the edge.

It getting easy to forget that in the dying days of the NDP decade, people were just walking away from their homes. Let the banks have them.

Funny thing is you still hear the occasional idiot that says it wasn't the BC Liberals that turned the situation around. Just shows that we can't take the change for granted if we want to keep the best economy we can.

I wonder how many sillies out there want the NDP back in the drivers seat to handle the host of challenges ahead?

I don't want the NDP back,but I don't credit the BC Liberals for the change. The facts are its is all about commodity prices in BC no matter who is in power. China booming at 10% a year causing commodity prices of all kinds to go through the roof is the reason for bBC's economic success in addition to the boom in pine beetle dollars. The BC Liberals came to power at the right time and road the wave. The question should be what have they done to sustain the growth....

You mean to tell me that the Chinese economy is booming on its own; that the BC government had nothing to do with it; that Colin's visit did not give them that extra kick.

BTW ... in case no one has noticed, the commodities stocks have been taking a nose dive in the past four weeks to the tune of 10% or so and are continuing to do so .....

Did you notice last week the Chinese central governemnt said their growth rate will slow down this year causing the sell off in commodities....

I didn't. But then the rest of the world may be starting to see what it is like sleeping next to an elephant that is still growing.
;-)