Data from REBGV Press Release.
2008 certainly was an interesting year for real estate market observers in Vancouver. For nearly 2 years the local market bucked the declining price trends seen in the US and elsewhere. Pundits had proclaimed that the local market was immune or insulated from the turmoil elsewhere. Oh how wrong they were. Benchmark detached home prices in the Greater Vancouver area are now at the same level as they were in June 2006.
This story is really all about supply and demand. There is lots of supply with even more coming and very little demand. Active listings are significantly above previous year's levels so the supply side is not helping those who want higher prices.
One may look to the demand side of the equation for some hope for some price appreciation but monthly sales are at half the level they were during the boom years with no quick fixes in sight.
Consequently, it would take a very long time, 16.4 months to be exact, for the current level of inventory to be sold off at the current rate of sales. This essentially means that the market is completely saturated with product and the only sales to be seen are the deep discounts.
The correlation between months of inventory and price changes is extremely tight with any MOI level above 7 MOI indicating further price declines. At the current level of more than double that, I do not expect rising prices anytime soon.
As mentioned previously, prices are now back at mid-2006 levels and the retreat has only begun. I fully expect inventory to swell in the new year and sales to continue at a lacklustre pace which will put continued and significant negative price pressure on sellers for the next while.
Great work once again - really appreciate the updates on the market.
It is quite phenomemal how quickly the tide has turned. It is going to be a very ugly spring....
I think the spring listing wave could hit a bit early this year as all those sellers who took their properties off the market to wait for that magic up-trend will want to beat the listing rush....only to discover that the recession has scared off the few remaining buyers.
I think investah is probably right.
Every year at the Yaletown elementary school parents have to line up the night before to get a space for their kids. This year there was a panic as parents said they were going to get there a little bit earlier. One family will wait 24 hrs, so the next plans to have a rotating shift to wait 48 hrs, so other parents end up camping out and waiting for 3 days in the snow.
That's pretty desperate, and it's only for school, not a house!
I hope to see some motivated sellers fighting each other and having bidding wars for the lowest price to get the sale!
I wonder if the benchmark detached price will fall below $500,000 this year? $550,000?
I think below $600,000 is a given.
$525K is "only" -20%. Not outside the realm of possibility though I am still looking for flatter prices in the spring.
$450k is a lead pipe cinch....and $400k is a strong possibility.
this is a really good blog. But I don't see many comments here. I think the reason may be you need to have an account to post a comment.
Could the blogger open guest comment so that people without an account can join the dicussions?
I really hope this blog can gain more exposure. It's really a good one.
The reason it's a good blog might be because the info appeals to a more knowledgeable crowd.
It would be a shame to have it polluted with crackpots and raging bulls in denial.
Wei "But I don't see many comments here. I think the reason may be you need to have an account to post a comment." This place is great the way it is. A half dozen thought full comments is far better than 200 mindless personality contests (Rob Chipmans Blog), or worse RET's 24 hr inferiority complex types trying to out do each other with fonts! Mohicans graphs and analysis are terrific! This blog and Pauls' stats are all a person needs! If you need more chat go to the hair dress salon! :-) Way to go Mohican!
Where did you get your data from?
The data is from the REBGV Press Release.
I have updated the post with a link.
Pope is gone! Did the REBGV actually pay him off? Was it $2500? More? Less? Or was it libel chill? Enquiring minds don’t want to jump to conclusions, right?I spoke to the Board and the twin explanations (pay off and libel chill) elicited sustained chuckling. I also received a series of emails between Pope and the Board in my Inbox (its been posted elsewhere, but what the hell - you can’t tell the truth too often).Running a blog is a lot of work, and a lot of committment.Toronto Lofts...
Consequently, it would take a very long time, 16.4 months to be exact, for the current level of inventory to be sold off at the current rate of sales. This essentially means that the market is completely saturated with product and the only sales to be seen are the deep discounts.fake rolex watches
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