This graph shows the inventory at the end of each month divided by the number of sales. The idea is to give an indicator of how many months of inventory there is, at the current pace of sales. For months like January (high listings, few sales) and December (few listings, some sales) the measure is a little wonky, but it is still interesting.
In the Fraser Valley, we have seen numbers in the 6 to 7 range. For the REBGV, we have now hit 4. As Mohican's excellent analysis has shown, we shouldn't expect much in the way of price decreases until we hit 7 or so months of inventory. So, we're not there yet.
Notice the growing gap between the 2007 and the 2008 lines. Not much difference in January; bigger difference in March. It will be interesting to see where this goes.
Data come from two sources. First, the REBGV was disclosing their total inventory in their 'blurb' on the cover of their monthly package for awhile in 2006-07. But, they stopped now. So, for the other months, I got the month end inventory from PaulB. I thank him for that. There are a lot of gaps in the graph, however, since I don't have the month-end inventory back to 2005.
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Vancouver Housing Blog
UPDATE: Here is an updated chart thanks to PaulB's data. Thanks Paul.
13 comments:
I have no problem providing the inventory numbers back to 2005. In fact I already do.
http://www.nvcondos.realpagemaker.com/aPage.jsp?aPageId=32
And very elegant data it is too. I think Paul should be given a gold medal for being Vancouver's most friendly and graceful realtor in the face of side swipes from bloggers, with a silver offered to Rob.
Thanks for offering to share, Paulb. I would be happy to ask Mohican to update the text of the post. I can't follow the link in your comment, though--the last bit got chopped off.
I always give full credit and linkage love to those who share their data. I think your site is absolutely great--I appreciate very much the effort you put into it.
I can find the charts and the monthly new listings on paulb's site. But what is needed for this MOI chart is the month-end total inventory count.
I am glad that Paul has changed his mind and decided to share his data with the blogosphere. I think that is a very generous thing to do. I think that this MOI chart will get very interesting in the next few months and it will give paulb's site a lot of publicity.
I don't post here or anywhere for financial gain. I'm happy to send others lots of traffic and attention when they do good things for the blogosphere.
I appreciate what you do paul - you provide a great service and I am sure your business will grow for your efforts.
There are certain pieces of data that the REBGV just doesn't provide and is only available to realtors. This data would be terribly useful to have and analyze.
What I'd really like to see is a sales to active listings ratio or months of inventory graphed alongside the GV HPI.
Feel free to do it yourself and post it on your site. I don't care where the information is and I'd be more than happy to link over to you when you post it.
Likewise you could send the data over to me and I'll post it here.
Thanks for the post newcomer. I enjoy reading your comments on all the blogs.
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"PaulB does have these data, but he decided to keep it to himself rather than share it with the blogosphere. He is worried that he will lose traffic if we use his data. I think the opposite is true--the more others use his data and link back to him, the more traffic he will get. But what do I know, I just ran a blog with 8K daily hits and that won national blogging awards. To each his own.
Vancouver Housing Blog"
What's with the rant?
I will e-mail the data to Mohican because he asked me first and does an excellent job with his charts and blog. If it is not the information you are after please e-mail me back before I get another "special" post.
Hi Paul,
Thanks for making the data available. I think my post was too snarky. I apologize to you for that. Mohican does a great job with the charts--I agree with you on that.
I'm sorry to have infected Mohican's nice shop here with my snark. I'll just walk away slowly . . .
Hey Mohican
Quite a coup to get VHB to post. I wish he would post more often.
He used to provide the best analysis on the web. Of course us bears were all wrong in those days, we underestimated the power of the herd- and in any case you cannot include every variable.
Nevertheless I would really like to see VHB post more often..somewhere.
Paul's number are excellent. Bears should remember to use him when we come to buy. Most of us are blogging for fun, but this is Paul's livlihood and we should remember how gracious he has been.
VHB has asked me to edit out the 'snarky' comment so I have. I echo your comments fish - I would highly recommend paul as a realtor since he is honest, sincere and realistic.
VHB:
Do not go anywhere. ;) Your blog is what turned me onto the seemingly impossible chance of a 'correction' a couple years back. If not for you I may be parroting... rich foreigners, running out of land and global economy as reason why Vancouver is magical and will never adjust.
Fish and Mohican:
Thanks very much for your support. Much appreciated. Our blogging community, (Coco and Pope included) is a great one.
I would even say owners who are following the blogs wondering when to sell should call Paul.
What you need when the market is softening is a realistic realtor, not one who over-promises and under-delivers.
The market crashed, and it was followed by 20 years of interest rate cuts.
Real interest rates are probably close to zero, will the stimulus this time around be 20 years of price cuts?
Quite possible I would say.
Great stuff.
Of course, R/E trends tend to be longer term. The longer there is data for MOI the better equipped a person is to analyse the trends.
For example, CalculatedRisk had a beautiful MOI chart (among many others) that clearly showed a trading range over quite a few years and the ensueing breakout during 2005.
Why are trading ranges potentially important information? They show a pattern or routine that will ultimately change somehow.
An easy example is a person who works 9 to 5, 5 days a week for 6 months. Then the next week, for whatever reason, the first 2 days this person does not contine their routine. Is this a change of trend or simply an abberation?
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