Two months downward average price trend, bored with stats, well, here are some more....
Well, what is there to add?
Two months ago, 19 million dollar plus properties sold. Last month only ten. Is it a glitch or an alarming sign that the top is in?
Can anyone selling a million dollar plus property in Victoria ignore 1-2 years of months of inventory (MOI)? Does the million dollar house become the $900,000 house, and so on?
This table shows the disconnect between the top and bottom of the VREB housing market. Months of inventory are already much higher at the top of the market than the bottom for all property types. Is affordability finally having an effect? Is it the credit crunch, are humongous mortgages now too difficult to get?
Or has all the smart money headed to the sidelines?
Predictions of blogging real estate bulls notwithstanding, this is not a market poised for a strong spring season.
As noted by Rob Chipman, the majority of recent price changes in his market area in Greater Vancouver (around 85%) have been price reductions.
Victoria is facing growing inventory while buyers have not stepped up in equal numbers. As Tony Joe of VREB noted in his monthly wrap up: There is a "strong demand for homes that are realistically priced."
Overnight interest rates have dropped again, without much impact on mortgage rates. This is not a sign of strength and independence of the Canadian financial system from US financial rot.
Average single family home (sfh) price trend in VREB:
December 2007 - $624,450.
January 2008 - $606,449.
February 2008 - $587,295.
Stay tuned.
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I like the analysis, but one problem - the VREB stats for February indicated 3311 total properties for sale. Your list totals 2184. Now, I know you haven't included vacant lots, manufactured homes and the like, but there is no way that accounts for the 1127 difference, even when you factor in the listings that expire at the end of the month.
So, the issues highlighted are probably much much more severe than you have reported here. February VREB total listings/total sales = 3311/619 = 5.35 MoI for ALL property types regardless of price, so I expect the MoI numbers in your chart should all be significantly higher (by a factor of up to 50% maybe).
And getting more severe by the day. I receive regular reports on a segment of the victoria condo market (lower end, 2 bedroom+, Victoria and Saanich only) from a realtor. SInce late February or so, the inventory has absolutely exploded, and sales have almost stopped. I'm holding my breath...
Thanks for the comment awum. My list just reflects what shows up on a particular day for a search of those property types.
The VREB stats would add the total sales for the month in there, plus the properties that are listed, expire and are re-listed, and then the other property types as you mention.
I think they also are including some Gulf Island listings. My search is not including those.
I'm not too clear on how they come up with their number, but as of yesterday, that was everything currently listed for those three property types for the VREB area.
There stats also include commercial, industrial, apartment buildings and business for sale in all areas including Duncan and the Gulf Islands.
My friend just sold his lovely Oak Bay House. The RE agent thought there would be many many showings and multiple offers. That sure did not happen. The house was sold only because it was perfect for a couple moving here or rather returning here - with grandkids etc. They were lucky it sold.
4 years ago it sold within 2 days and there were multiple offers.
The greed factor is still out there and people have not clued in yet but buyers are starting.
By the way ... my friend is a total bear. He reads your blog.
Sorry for the error, but my formula was incorrect in that cell. Anyway, the above graphic now shows the correct months of above median condo inventory. It is 8 months + already. Quite a contrast to the lower than median inventory situation.
"Two months ago, 19 million dollar plus properties sold. Last month only ten. Is it a glitch or an alarming sign that the top is in?"
I wanted to find out how many $1M+ SFH sold in previous months/years, but couldn't find this info on the VREB site. Does anyone know where to find it? I think VREB has mentioned the number in many of its previous monthly summaries, guess I should have paid more attention.
Thanks for the stats, Greg. I'm trying not to get ahead of reality as I have been wrong before, but it feels to me like that pause at the top of the roller coaster.
Homewardbound,
Detailed stats in pdf format are here You will find them at the end of the files.
Greg,
I managed to find the complete VREB stats for February. You can see a complete breakdown by area and price range. You can really produce some nice graphs with this data!!
CLICK HERE to retrieve the pdf file.
I don't know who posted this on Craigslist Victoria, but it is bound to raise the ire of the local real estate industry.
I thought it was pretty funny, in the midst of all the other desperate/out of touch/overpriced real estate listings.
Check it out and flag it as a favourite, its another way to get the bear message out there with the general public.
Thanks Roger. Out of curiousity last night I went back through some of the VREB press releases for the past year or so. It was not uncommon to see 20-30 million dollar + listings per month 6 months to a year ago. Last month the market only managed 10 in the VREB area.
What could be more obvious? Even as people at the bottom continue to buy, top end inventory is ballooning while buyers dry up. At the same time, mixed messages like the province trumpeting million dollar Vancouver city homes while inventory grows and building permits take a nosedive?
Optimism reigns supreme as Cameron Muir predicts another 7-12% gain on Vancouver real estate this year.
Meanwhile, others like the Vancouver Sun report a slowing of sales in REBGV.
Choppy water and stormy weather ahead!
Greg,
If you look in the stats file I mentioned in my last post you will see that there have been zero SFH sales in Sooke over 700K in January or February and today on MLS.CA there are 31 listings. Saanich West has 28 SFH for sale on MLS over 700K and 3 sold in February and 2 in January. Victoria and Vic West - 40 SFH on MLS today over 700K and 7 sold in February.
The listings have been pouring on this week. You can see the last 24 hours of listings by CLICKING HERE
Makes you wonder how many sellers will take their house off the market and how many will reduce their price because they have to sell.
Thanks roger for the link to the detailed stats. No question that the top end is not selling. Add to that the number of new listings piling on every day, mixed messages from the media, even that craigslist ad greg found, I think there will be a lot of nervous sellers soon. Interesting times.
"It used to be one of our big sellers that people could come out and start a family here, but the cost of living is working against us now."
A recruiter friend of mine says that it used to be an easy sell to bring someone from Halifax or Toronto- same or better wages and lower cost of living.
Now one part of the story has changed drastically-same or somewhat better wages but much higher cost of living. Of course, higher cost of living is predominately higher cost for housing. For both renting and owning.
I like this quote. Where are they referring to? Edmonton. Hard to believe, but it is now cheaper to buy and live in Toronto then Edmonton.
Meanwhile, the province of BC is trying to lure interprovincial migration with ads at subway stations in Toronto and Montreal, targetting yuppies who want a better lifestyle.
What does that say about the competitive disadvantage for business here in Victoria?
Yet another unspoken advantage of a real estate crash?
All other business gets cheaper and more competitive when housing is not a negative equation in the big picture.
HHV has been through this in depth, and all I can say is, when Edmonton is too expensive compared to Toronto, the bubble top has got to be in.
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