October 30 Market Update
This post is 6 years old. The data and my views may have since evolved.
Weekly sales numbers courtesy of the VREB.
| Oct 2017 |
Oct
2016
|
||||
|---|---|---|---|---|---|
| Wk 1 | Wk 2 | Wk 3 | Wk 4 | ||
| Unconditional Sales | 146 | 289 | 453 | 601 | 735 |
| New Listings | 265 | 479 | 698 | 922 | 904 |
| Active Listings | 1990 | 1989 | 1978 | 1982 | 1938 |
| Sales to New Listings | 55% | 60% | 65% | 65% | 81% |
| Sales Projection | — | 565 | 661 | 624 | |
| Months of Inventory | 2.6 | ||||
Running about 15% behind last year’s sales rate. Today we saw another 36 sales entered (some of those being from up to two weeks ago) and we’ll see likely another 30 tomorrow for about 660 this month.
Inventory is staying stubbornly steady and is resisting the seasonal trend to drop. We will close out the month at a couple percent above the levels of last October.
New listings are basically identical now compared to last year, so the drop in sales is the reason that inventory is not dropping like it should be. It would be very surprising if it managed to stay at this level to the end of the year though. The rate of expired listings around December will likely drive inventory down a bit.
Well played, sir. Well played.
I didn’t find Stanley Park any nicer than so many parks in Victoria. Matter of personal taste.But I did notice that to park there was $3.50 an hour. Before you suggest a bike, might i remind you that there are old folks like me who are not physically able to bike any more. It was a very minor thing in the general scheme of things but I remember it making an impression on me.
Besides walking trails, if which there are so many on the Island, what else do you see as great in Vancouver?
October numbers out: https://househuntvictoria.ca/2017/11/01/october-update/
Vancouver is clearly a world-class city. There is no denying that. Look at the city ratings year after year. It has so much to offer. Having said that, the insane real estate prices and moderately bad traffic make it unattractive to many people. I wouldn’t live there, but I understand why millionaires flock to Vancouver.
Regarding an exodus of people from Vancouver, it’s largely a myth. Of course there are some groups that leave, but the media stories are exaggerations. For a good discussion of this matter, listen to the latest Vancouver Housing Podcast: https://itunes.apple.com/ca/podcast/vancouver-real-estate-podcast/id1078731249?mt=2&i=1000394023368
The price increases over there continue to blow my mind. Either I’m an ignorant bearish fool or this is a gigantic bubble. The condo market in Vancouver is appreciating very quickly. For example, Metrotown prices have gone from $600/sqft in 2014 —> $1100/sqft in 2017! I’m beginnng to look like an idiot telling family members to diversify away from R/E!
Probably because it is awesome and fun and there are lots of employment opportunities.
Someone in Victoria wondering why any young person stays in Vancouver is a lot like someone in Campbell River wondering why any young person stays in Victoria 🙂
Not dissing CR or Victoria BTW.
In sci-fi analogy terms: Would you rather live closer to Trantor or to Terminus?
Lots of demanding little bagholders came to my door last night. They all wanted free food – most likely they have been impoverished by the housing crash.
Vancouver has excellent natural features, great shopping, a hockey team, great music scene, a night life, an amazing array of restaurants cheap to crazy, beaches, skiing, you know, a big city in the wilderness.
I know. I may have to re-evaluate.
I personally appreciate Vancouver’s proximity, in every direction, to endless beautiful hiking opportunities. I love walking the seawall, and Stanley Park is a gem. Vancouver has many other draws, but those are the main ones for me.
But I’d only want to live in certain places in Vancouver, and those places are the least affordable. And the winter rain might get to me. So I’m very happy to live in Victoria and visit Vancouver every so often.
Introvert:
I can’t believe that you are still actually reading Hawks posts much less responding to them.
Soon! The same “soon” you said years ago. You’re a desperate goof.
Introvert:
I have never lived in Vancouver so explain to me why people see Vancouver as an amazing city?
You might very well be right but I had trouble understanding it when we looked at Vancouver as a possible home and for us the cost of housing was not an issue.
The economics of it are terrible. But Vancouver is an amazing city, despite recent changes.
Frankly, I am hard pressed to understand the appeal of Vancouver in the first place (other than the weather which frankly is not nearly as good as Victoria). My neighbour’s daughter is struggling with the choice of whether to be in Victoria or Vancouver. She is a very talented young professional with an extremely high paying entry level job but is realizing that between the high cost of housing and taxes that she is better off in Victoria .
The article was a good read and sums up the problem perfectly. Especially the part about the tone turning hostile. I see it happening here I fear. As I like to say, all the cool kids are moving to Duncan…. It’s also life though. I have had cards dealt to me where you look up and suddenly life as you know it is not the same and not in a good way. I think she has accepted that and made her move to brighter pastures in AB. The positive thing about this is exactly that. Some other communities will gain some excellent assets.
Wow. Her story is compelling and well written. Revives mixed memories of when I lived in Vancouver years ago. It often does feel like a different country when we go back to visit.
Nice article, thanks for posting. In Victoria the top 17% or so of income earners can qualify for the mortgage on an average house. In Vancouver it’s likely only a couple percent. Why any young person would want to stay there I have no idea.
In Victoria? Foresight.
In Vancouver? Dumb luck.
ICYMI pumpers, the Big Short Canadian Style is on it’s way. Stock up on the Pepto, you’ll need gallons.
The investor behind The Big Short says Canada is ‘ripe’ for a severe housing correction
“Canada’s housing market is “ripe for a pretty severe correction” with Canadian Imperial Bank of Commerce the most vulnerable, according to Steve Eisman, a fund manager at Neuberger Berman Group LLC.”
http://business.financialpost.com/news/economy/eisman-warns-canada-housing-heading-for-slump-cibc-most-exposed
Oops,
Intorovert sounds like the guys I used to read before Nortel tanked to 5 cents from $100. Arrogant and smug until the lights went out.He should be dressing up as a drunken bagholder tonite. It will be a popular look soon. 😉
I’m dressing up as someone who severely underestimated Victoria real estate and is now pretty distraught.
Is Vancouver ever gonna stop?!!! The price increases have been way beyond my wildest imaginations!
What do people here think about those who speculated and bought RE as an investment a few years back? Dumb luck or rational foresight?
http://news.buzzbuzzhome.com/2017/10/vancouver-condo-townhome-prices-climb-next-2-years-cmhc.html
Happy halloween folks. Remember to mutter something about the OSFI stress test while taking the kids around, that oughta scare a few people.
Introvert: Thank you for recommending the “I left Vancouver” article. I found it interesting to read but I am not sure exactly what I thought about it.
I was struck by the fact that this woman seemed to have spent her twenties being nineteen. It almost seemed like there was this struggle between her valuing her favorite coffee shop or her relationship.
My wife and I looked at buying in Vancouver in 2014 but neither of us found the city particularly attractive or appealing. It did not even get into the top ten of places we wanted to live. But then again I am not a hipster.
caveat emptor: “So – what’s your advice? Anybody owning a principal residence in Victoria should sell now to take advantage of high prices?”
<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<
Hi Caveat. I would suggest that Hawk’s advice is more centered towards those that may have increased their equity by a couple of hundred thousand but have enjoyed that equity a little too much. The repercussions of the OSFI legislation are decidedly negative and the goal would be to bail out before they get trapped in.
“Several on the blog were offering the advice to sell and buy back in in 2008/2009.”
This is absolutely true however mortgage qualification couldn’t have been easier then and we were heading into an unprecedented declining interest rate environment. Regardless of the Bank of Canada’s direction in the future, Osfi legislation will set a huge bar for a lot of first time buyers and possibly even move up buyers. I would second Hawk’s advice for “investors” and monster mortgage holders .
Yes, there will be a lot of costs involved but wow, the upside could certainly be beneficial and any downside severely mitigated by credit contraction after OSFI legislation.
Hawk –
So – what’s your advice? Anybody owning a principal residence in Victoria should sell now to take advantage of high prices? Prices would have to fall quite far quite fast to really come out ahead financially. And then there are a lot of non-financial costs. The hassle of having to move at least twice. Potentially new schools for kids. Several on the blog were offering the advice to sell and buy back in in 2008/2009. I doubt that worked out well for many though there was theoretically a window to profit if you sold early summer 2008 and bought early spring 2009.
They were talking about this on CKNW:
I Left Vancouver Because Vancouver Left Me: A personal essay on loving, and leaving, a city after being defeated by its affordability crisis.
Hawk’s Victoria version is forthcoming.
https://thetyee.ca/Opinion/2017/10/30/I-Left-Vancouver/
Is this market top as clear to you as the previous one, when you sold right before prices increased 40%?
Look at https://evaluebc.bcassessment.ca/
17/Oct/2016 $665,000
Wow, if they sell anywhere close to asking, good for them. Doesn’t look like they did any work to it. Guess it’s been for sale for almost 2 months and had 1 price reduction.
Ruit: 1 year ago for $665,000
Hi Leo,
490 Viaduct Ave W is up for sale again. Can you tell me what it last sold for? I swear it was bought late last year or earlier this year.
Many thanks.
Indoor clothes line: http://www.greenbuildingadvisor.com/blogs/dept/musings/alternatives-clothes-dryers
“Market timing with your principal residence is stupid for most people most of the time.
Case in point: Hawk.”
Stupid people make up stupid assumptions when they are totally clueless to ones situation or life events.
Dont sell unless you like to see the easiest money you ever made in your life vanish month after month. Ask the millions of Americans in 2007 who lost 50% plus as well as their livelihoods and self worth going bankrupt and never recovering.
Someone who needs meds to drive the Langford parkway should be the last person doling out real estate advice to buy at a clear market top with hundreds of price slashes city wide the last couple of months.
That explains it. We are with you Deb about the cloth line. We just came back from 5 weeks France trip, and found that a piece of robe is part of our travel essentials as much as suitcase and hat. We also use cloth line only at home in summer.
But starting from now and until next April, cloth just wouldn’t dry on cloth line outside or inside, unless you live in a apartment with good heating and low humidity level. With baseboard heating set at 19 or 20C on at-home and daytime only and humidity level around 60%, you have to use the dryer a bit. Otherwise the cloth just won’t dry in a day, that they smell bad and you have to wash them again. Turn up heaters to dry cloth in a big house probably is not as efficient as the dryer.
We all want to do the right thing, but sometimes you need to be flexible a bit to achieve better result. Also it is probably a good idea not to judge others as they may live in a different type dwelling with different humidity/heating environment.
Case in point: Hawk.
Market timing with your principal residence is stupid for most people most of the time. The only (financial) reason to sell is if the cost of owning has already put you in a precarious position.
If you own investment property it might be a good time to see if you can see a better opportunity and take into account the capital gains taxes you will be paying.
Just a dude scanning MLS listings for any slashes, searching for hope…
Folks, don’t sell because you think the market is about to tank. Or else you’ll be the next dude.
“We run our dishwasher an average of twice a day, because we refuse to wash anything by hand.”
Fits the mould. Germaphobe/spelling Nazi/no English degree/biggest brain on the blog. 😉
Price slashes continue. 10 more just this morning, all in the core.
Zillow like companies have tried before but have not been successful in Canada. We’re not like most american cities. Too small and too diversified in the types of properties, house sizes and lot sizes.
As it is now companies like Solidifi data mine appraisal reports that YOU pay for when you get a mortgage. Appraisers lost control over the appraisal process and now the appraisal management companies have control over how appraisals are conducted and how much you pay for an appraisal. That’s not free enterprise as you can’t shop around for lower prices. I’ve heard of people being charged $800 for an appraisal while if they were allowed to shop around, they would have gotten the appraisal for half that fee. Because the middle man, the management company, adds a big chunk for being between the bank and the appraiser.
Zillow will become competition to the real estate boards and if it is like what happened with appraisals, the consumer will pay more for the service as they can not negotiate the commission and the agent will make less as they have to split their commission with Zillow.
(From the previous thread:)
That’s bold.
We run our dishwasher an average of twice a day, because we refuse to wash anything by hand. But our dishwasher is a top-of-the-line Bosch, which uses next to no water and very little electricity. And it’s so quiet you can’t tell it’s on except by the red dot of light it projects onto the kitchen floor.
Speaking of saving energy, I do want to get one of these someday:
https://www.breezedryer.com/rotary/hills-rotary-clotheslines-premium-range/
Leo:
Thank you for providing us with the numbers. We appreciate all the work that goes into this.
Zillow coming to Canada http://www.remonline.com/zillow-accept-canadian-listings/