After analyzing August 2015 housing sales, I’m getting the distinct impression that history is repeating itself. With a total of 741 sales in August being the highest volume since 2009, and with 3,688 active listings being the lowest count since 2009 – it makes me wonder why sales are following a similar pattern as they did six years ago. You’ll recall that after the stock market was routed in October 2008, the 5-year fixed interest rates (CANSIM V122497) dropped sharply from 6.5% (November 2008) to 4.8% (April 2009).
Of course, this year there have been ongoing market woes (Greece, China, etc.) and a similar downward trend with fixed and variable rate mortgages. The high sales volume and low active listings pattern is not unique to August … as it has been repeating itself over the past four months. Although the number of new listings is up 5% from last year, the last time the number of new listings was significantly lower was 12 years ago! While it’s not surprising that low interest rates are stimulating the volume of sales, I’m at a loss to explain why there are so few properties being listed!
Here’s some different ways of looking at the numbers:
VREB is touting the August sales with a “record” SFH average price in Greater Victoria of $681,449 – but it’s not really a record. After accounting for inflation, average SFH prices were higher during various months in 201 and 2012. Similar for the “record” SFH median price in Greater Victoria of $587,500, which after accounting for inflation was quite a bit higher during various months in 2010 and 2011. As Just Jack recently posted the SFH median price for August varies widely, depending on the neighbourhood. From a low of $460,000 in Victoria West to a high of $857,000 in Rocklands – aggregating the data tends to obscure the detail.
Here are the weekly number for the month of August …