Don’t get caught up in the online jabber and sensational headlines about the real estate bubble.
I must admit I love Twitter. I have asked for help and offered help. I have received immediate feedback, had a few thousand laughs and met some really interesting people. But what I get the most out of Twitter is real-time information. I don’t click through all of the tweets I read, but often I am drawn to the more provocative tags. Unfortunately, one that keeps catching my attention is @RETALKS.
@RETALKS is an open post forum that allows members to discuss whatever real estate topics they choose. While you can discuss any market in Canada, the Vancouver market is by far the most popular. For the meagre investment of your time signing on, you can battle with the bears and the bulls in their native habitat anonymously. Online anonymity is king and the calibre of the discourse reflects it. Sometimes, there is some insightful and thought-provoking discussion, but more often than not, it’s a bunch of finger pointing and name calling. Two of the worst have been relegated to their own post thread so that the relevance of the original thread can be maintained. Warning: Only read this thread if you like (ahem) reality TV. Think “Real Housewives” without a filter.
The “Bears” talk cover up which I always find so intriguing. Commenting on the September stats from the Real Estate Board of Greater Vancouver, Seth M. says: “This will only make the conspiratorially minded angrier — most of them convinced that the so-called benchmark indices produced by organized real estate are covering up a major decline.” The reality is the numbers from behind the HPI are actuals. They aren’t fabricated to prop up a cyclic market so that realtors can hang onto their markets.
Some of the @RETalks have been sounding the bubble alarm for years. If you call that sounding the alarm, then Garth Turner has been blowing his vuvuzela since what feels like time immemorial. Bubble talk is a popular headline — way more interesting than “Market slowly corrects,” and our news media is no different than China. (Well ,actually it is, but stick with me on the headline mania). China, which has had homeownership only since the 1990s, has never experienced a downturn in the market. Investing in real estate has only been upswing, but has faltered in the last year.
Other countries are in a similar pickle. Australia, Dubai, Thailand and Germany are all supposedly dealing with bubble woes as well. I could go on and name numerous other countries, but I get bored easily.
Let’s not panic. Real estate is cyclical and affected by economic fluctuations, demographics and policy. Have a five-year plan and don’t buy more than you can afford. Speculators — you’re on your own. The rest of us will sell at a loss and buy at a gain or whatever version of the law of supply and demand is in effect at the time. In the meantime, stay out of the real estate forums.