Quote:
Originally Posted by SumAznGuy
Negatively, basically, he predicts the market to crash sometime in the not too distant future after the 2016 Q2.
His new opinion, is that people in China are taking their money out of China any means possible and that something big is going to happen.
So even if they do a fire sale and get 50% on the dollar, it is still better than losing all their money in China.
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Maybe I am extra dense this morning.
To me, there is no question that the Vancouver housing market, and especially the high end premium market, has been fueled by a lot of Mainland Chinese hot money. In the recent few years, there has also been no doubt to me that the Chinese economy is on the downhill. It's just that the writing is finally all over the wall now.
What has been confusing is -- given the above 2 assumptions / facts / beliefs, I cannot tell whether the RE market will go up or down. On one hand, the imminent Chinese economy downturn / crash may accelerate the money exodus from Mainland China, and in that case, our RE market should go up. The rich would want to funnel their money out as early and as quickly as possible, so in the short term, prices will climb.
On the other hand, it is also possible that the combination of economy collapse, anti-corruption probes, and money control measures act faster than the rich can relocate their financial assets. Officially, banks in China are already enacting measures to limit foreign exchange withdrawls / conversions. If they can't get their money out, there would be no new funding to continue supporting our RE market, and housing prices will drop.
I cannot tell which of these 2 situations will be the one panning out, as they both seem plausible to me.