July 2008: Vancouver prices ‘deflating’

Deflate.  That’s the word the Vancouver Sun is using in their report of July sales data from the REBGV:

The so-called benchmark price for all property types in Metro, excluding Surrey, hit $556,605 in July, down 2.1 per cent from May.

“We’re seeing more price reductions in properties listed on the market, which is a levelling impact on the housing price increases experienced at the end of last year and into the first quarter of 2008,” Dave Watt, president of the Real Estate Board of Greater Vancouver, said in a news release.

The numbers from out in the Fraser valley are in as well and looking at least as bad. The Surrey average detached-home sale price is down six percent from June.  As Mohican brings to our attention Chilliwack saw the average house sales price drop 9 percent last month and is now negative year-over-year.

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201 Responses to “July 2008: Vancouver prices ‘deflating’”

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  1. 1
    mohican Says:
    Well, here we go folks. The downward slide begins in earnest. I think ‘earnest’ is somewhere near Surrey.

    Year Over Year price declines are on order for next month methinks - in the Fraser Valley anyway.

    Current score: 0
  2. 2
    jesse Says:
    For you Westside wannabes:
    VW detached
    Jun $1,456,122
    Jul $1,390,585
    -4.5% MOM, or 65 big ones.
    Chump change, my dear sir.

    Current score: 0
  3. 3
    Ultraman Says:
    Alleluia!

    Current score: 0
  4. 4
    DaveD Says:
    6%? So we’re already over halfway to the commonly cited “maybe a 10% reduction” figure.

    It had better level off pretty darn quickly.

    Current score: 0
  5. 5
    Dave Says:
    That’s a pretty high decrease for Surrey.

    The 1% declines in the other markets doesn’t surprise me and is in-line with my prediction for an approximate 5% decrease for the second half of 2008.

    I would speculate that the high price of gas has removed a lot of buyers from considering Surrey and the Fraser Valley. I predict any drops in those markets to be higher than Vancouver, Burnaby and North Van, which have better transit options.

    Current score: 0
  6. 6
    Not Mathy Says:
    Only a $65,000 price drop on the west side? Pshaw! I guess thats almost enough to keep you in lattes and Lulemon pants for a year, but you can’t paint a latte, and you can’t take out a line of credit on lulemon pants. believe me, I’ve tried.

    Current score: 0
  7. 7
    jesse Says:
    5% YOY is a significant figure for recent flippers because that is roughly the break even point including transaction costs.

    Current score: 0
  8. 8
    bcubbins Says:
    The numbers from out in the Fraser valley are in as well and looking at least as bad.

    Did you mean to say “at least as good”??

    Current score: 0
  9. 9
    Dosh Says:
    Good for people looking to buy, but none of you are buying are you?

    Current score: 0
  10. 10
    JB Says:
    Hundreds of banks will fail, Roubini tells Barron’s

    http://www.reuters.com/article.....0720080803

    Current score: 0
  11. 11
    Drachen Says:
    Dosh

    “Good for people looking to buy, but none of you are buying are you?”

    None of us are buying NOW that would just be plain stupid. We’ll wait until prices correct to a reasonable proximity of market fundamentals and we’ll laugh at chumps like you all the way to the bank.

    Current score: 0
  12. 12
    bdk Says:
    Again I am writing to question Dave’s motives.
    If you really live in Victoria what are you doing on a Vancouver Condo blog other than vainly spreading disinformation?

    Are you purposefully hoping someone will believe your spin in the hopes they will go bankrupt? Or are you trying to sell something?
    That was nice of your Wife to deny your identity.

    Current score: 0
  13. 13
    Strataman Says:
    Dosh “Good for people looking to buy, but none of you are buying are you?” Of course not! :-) My three adult kids now believe me and are SOOOO happy they are sitting with their downpayments…impatient yes but now they are believers, I said wait three years and pick whatever you want at 40+ % off! And they are gonna! :-) Me Proud!

    Current score: 0
  14. 14
    Vansanity Says:
    I love reading the comments below the article! Check out C22’s if you haven’t already.

    Not Mathy - You’re “not facty” either. I used white out, technically not paint (I sniffed, no high), anyhoo, I “painted” my latte this morning whilst on the phone… so get your facts straight. You CAN paint your latte! It’s a stock, that you can’t paint, although I hear they actually used to give paper as representation of the stocks and you can paint them too… so…ya, not sure where to go with that…and so on and so forth.

    Current score: 0
  15. 15
    Dave Says:
    BDK, if you read the prior thread you will see that Pope has already confirmed that I have nothing to do with ‘Dave@revnyou’ or ‘the source’.

    I only recently moved to Victoria and have always lived in the GVRD prior to that. I am not selling anything. I am not working on anybody’s behalf. I am simply sharing my informed opinions on the real estate market.

    This will be my last post on the subject. I think Pope is getting impatient with these silly conspiracies. Let’s stick to the discussions. If you have something intelligent to contribute, then please do. Otherwise, please crawl back to your cave (rented).

    Current score: 0
  16. 16
    Strataman Says:
    Dosh one of them might be your neighbors in three years and you can go to the Strata meetings together and insist on increased fees for more amenities that the newer owners (at 1/2 the monthly mortgage payments) can easily afford! :-) :-) Isn’t it great to look forward to new cash flow positive blood in your neighborhood? :-)
    Current score: 0
  17. 17
    condohype Says:
    Why is it when talking about price drops the media sounds like they’re talking about erectile dysfunction? “Deflating” prices? A “softening” market? It’s pathetic.

    Current score: 0
  18. 18
    bdk Says:
    “I am simply sharing my informed opinions on the real estate market.”

    Is PR spin “informed”
    Next thing you’ll be claiming tobacco has never killed anyone.
    Why don’t you stick to the cafe’s in Victoria and keep your dumb ideas to yourself.
    The Pope didn’t confirm that you are not the same person. You could be posting at home and at the cafe or from work but more likely than not you’re at a cafe since Mortgage Broker/Rookie investors don’t have much to do these days.

    Say hi to Julie for me.

    Current score: 0
  19. 19
    blueskies Says:
    I am simply sharing my informed opinions on the real estate market.

    typo!

    that should read:
    “ill informed opinions”

    Current score: 0
  20. 20
    Strataman Says:
    “like they’re talking about erectile dysfunction?” Judging from couples I know who are recent home buyers I would say there is a lot of “erectile dysfunction” at the moment! :-)
    Current score: 0
  21. 21
    blueskies Says:
    strataman:

    a “flaccid” investor?

    Current score: 0
  22. 22
    Patiently Waiting Says:
    Now that the smart money has sold:

    “$325 MOVING SALE ASSIGNMENT -NON PROFIT,FOR SALE!!! (NORTH BURNABY)”

    “BRAND NEW 1BED.+DEN. AT BRENTWOOD GATE,EXCLUSIVE AREA WITH NICE COMMUNITY AROUND..
    CLOUSE TO THE HWY,UNIOVERSITY AND COLLAGE AND MALL IS EXCELENT PLACE FOR LIVE.
    THIS NICE APARTMAN HAVE EVERYTHING:2BALCONIES,1 PARKING SPOT,STPORAGE,IN SUITE LOUNDRY,GAS FIRE PLACE,STINLESS STILL AND GRANITE COUNTERS,694SQ/FT.
    PLEASE REPLAY FOPR MORE INFO.
    PAY NOW SOME,AND RST BEFORE YOU MOVE THIS OUTUM….”

    http://vancouver.en.craigslist.....35645.html

    Current score: 0
  23. 23
    crabman Says:
    Otherwise, please crawl back to your cave (rented).

    Don’t you mean our “soon-to-be-underwater-flipper” subsidized cave?

    Current score: 0
  24. 24
    blueskies Says:
    STINLESS STILL

    satv is that you?
    tell me it ain’t so!

    Current score: 0
  25. 25
    Bluesman Says:
    Woohooo!!!!!!! I ain’t got the blues no mo’

    Current score: 0
  26. 26
    M- Says:
    So much for the theory about the Westside being unable to drop due to demand, desirability, and rich affluent buyers!

    Vancouver Westside SFH median prices:
    July ‘08: $1,326,500
    June ‘08: $1,549,000 (DOWN 14% MOM)
    July ‘07: $1,415,000 (DOWN 6% YOY)

    Current score: 0
  27. 27
    Patiently Waiting Says:
    “For you Westside wannabes:
    VW detached
    Jun $1,456,122
    Jul $1,390,585
    -4.5% MOM, or 65 big ones.
    Chump change, my dear sir.”

    Really? The numbers I see for Westside SFH median are:
    Jun $1,549,000
    Jul $1,326,500

    -$222,500 or -14.4%

    Am I reading it right?

    Current score: 0
  28. 28
    Patiently Waiting Says:
    Oh OK, M- found the same thing :)
    Current score: 0
  29. 29
    M- Says:
    Heh, I beat you by two minutes, PW!

    Current score: 0
  30. 30
    /dev/null Says:
    Benchmark versus median…

    Current score: 0
  31. 31
    M- Says:
    REBGV SFH average prices:
    July ‘08: $828,781
    June ‘08: $904,167 (DOWN 8% MOM)
    July ‘07: $831,195 (DOWN 0.3% YOY)
    Peak: Feb ‘08: $920,643 (DOWN 10% off the peak)

    Current score: 0
  32. 32
    Dave Says:
    Where are you getting your numbers M?

    Current score: 0
  33. 33
    M- Says:
    Dave: I’m getting them from PaulB’s monthly stats on his website (nvcondos.ca), and from this month’s REBGV statistical release:
    http://agentwill.com/statistic.....the-rebgv/

    Current score: 0
  34. 34
    John Says:
    You would be insane not to buy a condo right now! This is probably the best time ever to get into this market especially with the new mortgage rules coming soon. I don’t think you’ll ever see such a great selection and such competetive prices for this world class city. Once the Olympics come and everyone snaps up condos you’ll be sorry.

    Current score: 0
  35. 35
    M- Says:
    Taking the Westside SFH median a little further, it looks like the peak was Feb 2008.

    Vancouver Westside SFH median prices:
    July ‘08: $1,326,500
    Feb ‘08: $1,625,000 (DOWN 18% off the peak)

    (Note: I’m missing westside median data for Aug 2007 through Oct 2007; it’s possible there could’ve been a higher peak in there somewhere)

    Current score: 0
  36. 36
    Raincouver Says:
    John says..

    You would be insane not to buy a condo right now! This is probably the best time ever to get into this market…

    I feel your pain, buddy.

    Sometimes irony just doesn’t cut it, eh?

    Current score: 0
  37. 37
    islander Says:
    This will be my last post on the subject.

    And then he posts again 3 1/2 hours later.

    Current score: 0
  38. 38
    Dave Says:
    Islander, I can only assume you are lacking in the reading comprehension department. The three key words that you didn’t pick up on were, ‘on the subject’. The subject in this case should be pretty evident. Let me know if you need help figuring it out.

    If you have something useful to post, then please feel free to contribute. In the meantime, go back into your cave with bdk.

    Current score: 0
  39. 39
    jesse Says:
    We can discuss ad nauseum benchmark vs median vs average. The latter two are inaccurate because they do not quality adjust. The benchmark is down 4.5% MOM and even more from the peak. We can infer the methods used, though opaque, have some semblance of mathematics behind and I doubt they are using cooked numbers. Note the benchmark was down June-July ‘07 as well (but not by much).

    Current score: 0
  40. 40
    scullboy Says:
    John:

    I love your posts. You are absolutely brilliant. Keep it up dude. You’re like the antithesis of Krrrrish…

    Current score: 0
  41. 41
    stagnate Says:
    everyone and their dog would like a vancouver west side house but the very high end of the market weakens quickly. people retrench and the high end loses its move up buyers. i had the peak for the market in november, overall a 5% decline with another five percent baked in the cake based on current numbers. demand/supply/economic conditions are a bit clouded currently but should be a clearer picture by mid/late september.

    Current score: 0
  42. 42
    Gorky Says:
    John,
    Gosh what an enlightenment - of course people who visit for the olympics buy a condo here just in case some day they come back to Vancouver.
    Kids, pack up we’re moving to Vancouver, after all they hosted the olympics.

    Obviously I snappped up a condo at every vacation location I ever went to as they all happen to be on the ocean and very beautiful.
    As scully mentioned, keep it up Johnboy you’ve got it all figured out ;-)

    Current score: 0
  43. 43
    scullboy Says:
    It just occurred to me…. think of all the fun we could have if we went out and infected other blogs/ comment sites (Vancouver Sun, Chipman’s numbers) with John - like comments.

    Glorious chaos :)

    Current score: 0
  44. 44
    John Says:
    The upper crust in asia DO buy homes in every city they visit. It’s like the equivalent of the snow globe you buy on your trips to the Walmart in Blaine every now and then. Then there’s the Albertan oil patch workers who just go crazy and buy all kinds of property and toys everywhere they go. They’ll all be coming to the olympics. Sure, Toronto is staying home because they’ve stopped making cars and selling oil futures but down in the heartland things are good.

    Current score: 0
  45. 45
    stagnate Says:
    that is really solid humour. i thought browntown’s post in the last thread was post of the day but i’m changing my vote to post 44.

    Current score: 0
  46. 46
    cashisking Says:
    Watch what happens to the price of oil to see what will happen to RE prices in Vancouver … It had a 118 handle today down from a high of 147 … do you remember 147 - “we’re running out of oil, price is going to 200 (250 if your the russian oil minister)” … remember tech stocks … stock market is just much more liquid/quicker
    Everyone can spout all the stats they want but this market is in for a big correction … split hairs with benchmark (remember your source - russian oil minister?!?) or median prices (inflation adjusted - do you believe CPI?!?) but look at the big picture and remember that it’s never different.
    ps buy the HOD - Beta Pro ETF …. I just wish I could short VCR RE

    Current score: 0
  47. 47
    cashisking Says:
    And no I’m renting after being in the market for 14 years and selling last summer … 8 bidders - the good old days!!!!

    Current score: 0
  48. 48
    condohype Says:
    Global TV just reported that real estate prices across Greater Vancouver have dropped! I can’t believe it. It must be a lie. If only someone could post a screen capture to prove it.

    :)

    Current score: 0
  49. 49
    wolfey Says:
    john…

    I am going to try to put this politely. rich people, regardless if they are Asian or not are rich for a reason. They are good with their money. Why invest in Van or Canada when it is so much cheaper to buy in florida. or Arizona…etc RIGHT NOW. They aare at least 30% less than Van and there is way more selection. true Van does have mountains but Have you compared florida beaches to Vancouvers’ . There are many beach volleyball/ surfing tournaments( such as NKF Pro Am Surf Tournament…AVP Next/Wilson Beach volleyball National Championships, sept-October 2008)
    thru a large portion of the year..even the famous Fort Lauderdale spring break. Do you have any idea the amount of revenue generated in those areas? How many such tournaments are held in Vancouver beaches…please tell me. There is only 1 Beach v-ball event @ kits for 2 whole days not even 2 monthes.

    Vancouver is anice place but it’s not the best place in the world. I ‘m suprised no one has sued on thr basis of misrepresentation. So just open your eyes and smell the BC BUd because that really is our major export here in BC

    Current score: 0
  50. 50
    Re-diculous Says:
    …I’m watching to see when Bill Good assembles the RE experts to see how they are going to spin this…I think Bill’s on holiday’s curently, so it’ll probably be within a day or two after his return

    Current score: 0
  51. 51
    jesse Says:
    B.S. Good(rich) will point to summer doldrums and an improving US economy that will bolster prices in ‘09. Shall we take bets on what black swan he and the other “experts” will cite when prices are down YOY?

    Current score: 0
  52. 52
    wolfey Says:
    Hi John… Just so you know Iam telling the truth. Here are some Condo listings in Florida

    http://fortlauderdale.condo.co.....h_Featured

    http://miami.condo.com/Condo-F.....=MapSearch

    http://jacksonville.condo.com/.....=MapSearch

    http://palmbeach.condo.com/Con.....h_Featured

    http://miami.condo.com/Condo-F.....h_Featured

    Agreed some condos are overpriced but they just experienced a housing bubble that is now deflating.I ‘m sure most bull/ bears would pick these up in a snap if they were in the vicinity. Of course you would rather buy a$ 300 k plus 500 sq ft condo in downtown because we are the best place on earth.

    personally i’ll take the emerald isle…pay in cash

    Current score: 0
  53. 53
    Gadwin Says:
    The median price for a SFH detached dropped $28,500 from $527,500 in June to $499,000 in July in the FVREB (http://www.fvreb.bc.ca/statistics/Package%20200807.pdf).

    For the REBGV, benchmark price of a SFH detached dropped by $12,489 from $765,654 in June to $753,165 in July (http://agentwill.com/statistics/real-estate-board-of-greater-vancouver-releases-june-2008-statistics/ for June stats, and http://agentwill.com/statistic.....the-rebgv/ for July stats).

    Soft landing? LOL. Down 28K in one month for the FV doesn’t seem like a “soft landing” to me!

    Current score: 0
  54. 54
    andrew Says:
    @ Wolfey

    True dat. Rich people didn’t get rich by buying overpriced goods, be it cars, companies, consumer goods, investments, or real estate. They get rich by buying things for less than they will be worth in the future.

    Current score: 0
  55. 55
    not cameron Says:
    … “prices are not under as much upward pressure…”

    Right. Got it, Cameron. So will we see a 1% or a 2% decline before fantasy land returns to the market?

    Current score: 0
  56. 56
    Anonymous Says:
    Be nice to Dave, guys. I want him to still be around when prices have dropped his approximate 5% decrease for the second half of 2008 (that’ll be August), and continue on down. His spin is truly gifted, bass-ackwards but gifted. I find it hard to believe he is truly an impartial observer, too familiar with the talking points of the RE industry, and too willing to ignore refutations of his “facts”. Too literate and RE knowledgeable to be to be just ignorant and naive. Hey, Dave, be careful, you don’t actually BELIEVE the stuff you spout, do you? Do you know why SUCCESSFUL drug dealers don’t take drugs? Easy to make money selling kool-aid, but don’t drink it yourself!

    Current score: 0
  57. 57
    Re-diculous Says:
    Spin du jour:

    http://www.canada.com/vancouve.....59df91719b

    “Cameron Muir, chief economist for the B.C. Real Estate Association, said he doesn’t believe that there was a housing bubble that has now burst, but said there has been a change in the cycle….” interesting, he doesn’t deny there may be a bubble, he just doesn’t believe it.

    Current score: 0
  58. 58
    not cameron Says:
    Further to my earlier comment (#53), the distinguished Mr. Muir was on CBC’s Early Edition today preaching that the results from July are merely a summer slowdown. Nothing to worry about - economic fundamentals are sound, so move along folks.

    Cameron: No one is disputing that the economic fundamentals are sound. The fundamentals were sound during the dot com era as well - sounder, in fact. But that didn’t stop overpriced stocks from correcting. The fundamentals are sound in San Francisco too, and yet the bottom has fallen out of their market.

    Could someone please get these bloggers onto the CBC…

    Current score: 0
  59. 59
    blueskies Says:
    john:
    rich people aren’t stupid
    and stupid people don’t get rich
    which succinctly explains your current position.

    Current score: 0
  60. 60
    Vansanity Says:
    John IS right!

    In fact, we should be putting every last dime we have into condos in Beijing right now!

    I wonder if it’s too late to get in on all the previously discovered places like Turin, Athens, St. Lake City, Sydney, Nagano, Atlanta, and Lillehammer? Too late? What am I saying? Time to get in!

    Current score: 0

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