March and the inventory is still going higher...
Well, chalk up some more million dollar + inventory. A few days go by, and another few properties are added to the waiting list. The inventory of single family homes increased as well. Over 8 months of "above median" condo inventory is now listed, based on the February 2008 VREB stats. This is March, shouldn't buyers be taking up the slack by now?
I see over at Rob Chipman's site his most recent report of price changes was that 90% + of all changes were reductions. Also, the average list price in Chipman's area was $556,677, while the average sale price was $548,169, a difference of $8,508, or 1.53%. Which is lower. Is that a hot market? I know Vancouver and Victoria are not the same place, but I would assume that Victoria is not the tail that wags the dog--but rather, the opposite is about to occur.
That is to say, when prices in Vancouver start falling due to the mother of all condo gluts, all outlying areas, including Victoria, are going to get slammed.
But perhaps you disagree?
Here are some other interesting topics:
The NY Times has a story about how non-residential construction is faltering.
Meanwhile CMHC reports that Canadian housing starts soared in February 2008.
Ben Bernanke proposes lowering principal balances of underwater borrowers, rather than helping with temporary interest relief measures.
Can I get some of that free money? I mean, if I could buy a $700,000 Fairfield house and then get the bank to forgive $300,000 of principal, that would be sweet! Even sweeter, the seller gets the full freight, and the game of musical chairs can continue for another round. Sounds like a win win situation to me...
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Greg,
Great update and comments.
Today's TC article Housing market expected to stay strong is misleading but it contains good news for bears!!
Provincially, homebuilding starts in urban B.C. surged last month to 48,800 seasonally adjusted at an annual rate, up from 33,600 in January.
"The forecast is for lower level housing starts this year than last," said Frketich. "We're looking for a 15 per cent lower level of starts this year. February looks very much like a spike."
But on Vancouver Island
Vancouver Island housing starts slid to 277 last month from 317 in January. February's numbers are also below the same month a year ago when 354 homes were started, CMHC said.
"In metro Victoria, single-detached housing starts have picked up this year relative to multi-family starts," said Peggy Prill, CMHC senior market analyst. However, the number of multi-family homes being built here remains at near-record highs.
Bring on more condos - just what the market needs!!
Then the pathetic excuses for the poor Vancouver Island numbers:
"They are probably down a little bit because it is a seasonal thing. There is usually a rush to finish before Christmas," Rebneris said.
Even with the decrease, housing starts remained above the 20-year average for the first two months of this year.
Now they are using the Christmas season and 20 year averages to justify the sliding market on Vancouver Island.
By the way Herman Rebneris, president of Cottage Grove Developments Ltd. has not had any major developments since 1998 according to his website A Goggle search indicates that he a is a local affordable housing activist.
Is he also a forecaster of the future of housing in Victoria? I don't think so!!
I was reading the Times Colonist on Saturday and came across an article Family trading quarter acre for 975-square-foot digs
There were some interesting stats:
He knows of only one other family moving into the project with a child although developer Joe Van Belleghem said future phases will aim to bring more families to the neighbourhood.
Currently about 25 per cent of purchasers in 98-unit Synergy building are under 40, and about an equal number are between 40 and 49, and 50 and 59.
Meanwhile, Balance, which has 170 units, appears to be appealing more to the very young (13 per cent are 20 to 29 years old) or older purchasers 50 to 59 years old who make up 45 per cent.
Around 40 per cent of the buyers come from the Island, with Albertans following. There's a smattering of exotic places listed among buyers: Dubai, Taipei, Korea, Taiwan, Bermuda and the Cayman Islands.
I was really surprised to see less than half the units were purchased by Vancouver Island residents. How many Alberta "investors" are left to soak up the mounting condo inventory??
Seems to me the TC is trying to get us all buying Condos. i.e.. "Can't afford that SFH you've always wanted? No worries, condos are all the rage now. You don't really want all that yard maintenance do you? With a cheaper condo, you can have more time for family and activities. There's always something you can buy in this crazy real estate market!"
Thanks for posting this - interesting b/c I've been starting to see DG condos appear for rent on craigslist for outrageous prices. Of all the overpriced condo/TH developments around right now, DG is the one I'd like to see succeed as I do think the developers have made a genuine effort to do something green and different. And I do think that rehabilitation of brownfields is part of the solution to sprawl, and that DG has the potential to be a great community, if anyone can afford it. While I kind of admire the couple discussed in the article, I can't imagine them lasting long with a baby in 975 sqft condo with few other children around - and the whole DG area is going to be a construction site for the next several years, so overall this sounds a bit bleak. I think DG might be a great place to live when it's done and RE values have come closer into line with local incomes.
Please keep posting your thoughts and stats Greg. For me it is all about the numbers. People can only act irrationally(buy over priced real estate) until they just can't afford to service the debt. I think we are at a tipping point.
Thanks for your efforts with the stats. I particularly like the Vancouver Island angle. Please keep up the good work.
Thanks Kicker, really, I guess I am just collecting and presenting the info I want to get out there - hope its not too biased....
No Greg the biased stuff quotes VIREB as it's source
Cheers