I'm not saying "to the moon" no one believes that prices will shoot up forever. However as time and prices have gone up, reverting to the mean seems less and less likely. Things will continue to trend up and down however I think things will never "trade" and previous levels again as equity has built up and will support a much higher price compared to past.
So in equity terms, the price has gapped up and has and will find support and resistance above previous moving averages.
Since that last drop in 2008, its been almost 10 years. All the people who bought are already half way through their 20 year mortgage. There is not only equity from appreciation but also repayment of principle. As time draws out there will be less and less chance of a catastrophic copllase due to distressed sells.
Even if the market slowly goes down, there will be no epic correction. There needs to be some sort of huge financial disaster and force lots and lots of people underwater and force to fire sell, massive un employment or 20% interest rates. People will hold onto their property and erode equity before they fire sell.
So the longer this draws out the less likelyhood of something crazy happening.
No need to be sorry for the bears, the market is still in a downturn.
Lets clarify a few things here, the first being time frame. We are all bullish with vancouver RE on a decades timeframe, i dont think anyone disagrees that in the long run van should go up. With that said, on a yearly time frame, we are currently going through a correction.
I have to say your analogy with equity is not an accurate comparison. The van RE did not gap up, the market does not close overnight, there was no event that occured that could cause a gap in the market. More importantly, it has not found support. You can not claim that there is a support because the market is still falling. A support would mean that there are enough buyers to prevent the prices from decreasing. We will eventually find a support but not yet at these price ranges.
You cant apply moving average technical analysis on this market because you dont have the data. The best you have are the average prices that the board releases monthly which is lacking for that kind of analysis. You would need to have open,close, high and low on a daily/weekly time-frame to be able to make any meaningful analysis of this kind.
Lastly, please realize that the timeframe for realestate is much slower than that of equities. You may think that a few months of price decline is a long time for realestate but its actually not. A 15 to 20% decline in less than a year is indicative of price rejection. Make no mistake, we are not consolidating or finding support in the current conditions - the price has been rejected and prices are heading down just looking purely at the numbers. There are no buyers, there is no support.
I want to clarify that this is for the detached market. Townhomes ans condos seem to be finding support from local buyers. With that said, if detached prices keep falling at this rate, it will trickle down to the non detached market.