Friday, June 15, 2007

Supply Overhang, Doverschlang!

In the words of VHB - What rhymes with overhang? - clearly the answer is 'doverschlang.'

This chart is courtesy of the VHB's private treasure trove of charts and data. It is a long-term chart tracking new housing supply through CMHC's starts, completions, and under-construction data. The area is the Vancouver Census Metropolitan Area.

What I find interesting here is that the 'under-construction' number has never risen above the completions number until 3 years ago. This leads me to believe that we are in unprecedented territory in the Vancouver CMA in regards to the potential supply overhang that is about to hit once all of the units under construction right now complete and the occupations take place. It is also interesting to note that normally the units completed falls approximately 6 months after starts fall (starts are falling right now) and normally the units under construction falls along with completions. This is not the case right now for whatever reason.

Remember that nearly every completion means another available rental unit or unit available for sale. Because population growth is low the demand must come from within the Vancouver CMA.

UPDATE: Area Breakdown

Look at all those units under construction. Crazy.


WoodenHorse said...

Regarding VHB's treasure trove of charts and data: Where can I get my hands on that? Did he post it on the web, or did he send it to you?


mohican said...

VHB sent me this chart personally as he thought it might be interesting. I agree - it is interesting.

VHB did release most of the data he compiled to the three local bloggers, the pope, mohican (me) and solopsist.

If you want anything in particular - data wise - send me a private email and I'll see what I can do.

WoodenHorse said...

Thanks Mochican.

I'm mulling over picking up the slack on some of the indicators that VHB use to make.

I'd particularly like to reserect the "You are Here" graph of Westside Apartments.

mohican said...

woodenhorse - send me a private email and I'll send the data you want. I can add you as a contributor here if you need a forum for posting the data in chart format.

WoodenHorse said...

A quick drive around Vancouver brings this posting into sharp focus.

Have you heard that Jack FM commerical calling our offical bird the construction crane?

M- said...

Wow, that overhang of "under construction" units is *insane*. If you take out the Surrey and Langley data, what's left is fully HALF of the GVREB's annual resales. Half a years worth of housing resales about to come onto the market as new units.

The number of housing units currently under construction is worth about 2.9% of *ALL* the housing in existence in the lower mainland.

Insane. We'll see how quickly it comes to market, but I find it truly astonishing.

I'm so relieved that I'm out of the market. Sold two months ago for a very good price.

Unknown said...

I wonder how many of these units have been presold.

is there any way to find this out?

solipsist said...
This comment has been removed by the author.
Van Housing Blogger said...

Thanks for posting this. Just saw it now.