House Prices vs. Population Growth

Vancouver Population Growth vs. House Prices

The REBGV December 2009 stats are out and the average Vancouver House price has reached a mind-boggling $952,927 despite less than peak population growth rates.

Don sent in the information above – this chart shows Vancouver average house prices from 1977 to 2009 superimposed on a graph of the BC population growth in percent from BC Stats.  The $300k price point correlates to 3% population growth.

One thing to keep in mind is that some divergence is only natural: one percent population growth in 2009 represents more people than 1% in 1977 because we’re starting with a larger base population.  It’s still interesting to see the correlation between population growth and house prices.  There was actually very high population growth in the late 70s and early 90s that relates to those housing booms.  By the middle of the 90s this growth had real house prices nearly back up to what they were in 1981,

You can see the correlation between the housing market decline in the mid nineties and the drop in population growth.  We’ve never recovered that high rate of population growth (as high as 3% in the mid nineties).  We seem to have peaked at 1.7% in 2008.  It will be interesting to see what BC and Vancouver population growth does going forward – will ‘everyone want to live here’ or will we see a a decline in population growth with fewer infrastructure project jobs and less construction?

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scullboy

Actually, the move thing is pretty good advice. I can attest that household incomes are higher here in Halifax. As for "the day of the house is over"….. no it isn't. The day of the 1.4million dollar bungalow certainly is over, however. Supply, demand and the free movement of capital and labour will take over eventually. Young people aren't stupid. Those who haven't locked themselves in to a 500 SF condo are going to look around Vancouver, say "We can't afford the Vancouver lifestyle" and leave. They'll move to places where the salary / price ratio is more favorable, which should mean Canada's smaller cities. Vancouverites will be locked into their mortgages which is unfortunate. It means they're forever tied to that city and won't be able to take advantage of opportunities that may arise in other towns. Worse, they'll… Read more »

logic

ESL for the love of God….

Charlie Tuna

@Anonymous: @Anonymous:

@SpitfireS: When smart capital exit it leaves other no where no rugs underkneth,If people don’t fear stock will lose only 50 cents instead of it’s entire value,Warning to all the middle class people there, most of stocks result runs with institutional news agenda all the big fishes enter with the news making story beofre and after hour trading,gain in the daily stock price always been aquired by institutional investors that kill all the middle class people by forcing them to buy at highend and they exit before the next set of news made by same people.so better buy Vancouver real estate.if you ever find bunch of jokers in real estate market they can not harm Vancouver real estate.

Can somone translate this for me? (maybe too much invested in RE and not enough in an education?)

E. Benedict

@SpitfireS: I would have just told E Benedict to look up the definition of stock volume, because somebody does not end up with all the cash the everybody else lost. It is not a system where 1 dollar in produces 1 dollar out. By 'somebody' I didn't mean one person! Of course 1 dollar in doesn't mean one dollar out! But that doesn't mean that there were tons of losers and no winners. Of course some people made a lot of money on the tech bubble (especially those that shorted selected overextended P/E ratio tech stocks). In the same vein, some people have made a lot of money on the Vancouver RE bubble, particularly the Vancouver Sun (which, if it wasn’t for the local RE industry paying it to print their press releases, would have gone under a long time… Read more »

jimtan

The chart may be statistically correct, but the argument is flawed. For illustration purposes, say today's population is around 2x that of 1970, 1-1/2x that of 1980, 1x that of 1990. In that span of 30 to 40 years, 2 generations have grown up, married and reproduced. In the last decade BC Liberals have admitted foreign workers + international students in the same proportion of immigrants. Furthermore the number of new arrivals is expected to continue at the same rate if not surpass. So why are you guys banging your heads against the brick wall?

SD92129

VREAA,

I presume it has been some good hunting lately (for anecdotes). Good quote. I Could not quickly (ie. google) find its originator. I am going to use that one in a project meeting throwdown.

I find the lame bullish ones quite amusing. Truly comical when someone is trying to make their point by extrapolating from a minute observation. I believe it generally comes from the trolls to fire up the bears. Nevertheless, kinda entertaining.

bdick

fucking retard

Bdk toll

@logic: you don't know what is market cap?

When it disappear all the left over swimmer lost there sense of swimimng,In this situation they can't hold a peace of grass during tail spin that's how they go down down down down down.

down,down

down,down

Buy Vancouver real estate and enjoy your life because hey Vancouver real estate never goes down.

logic

91:

"When smart capital exit it leaves other no where no rugs underkneth"

—————————–

What. The. Fuck?

[…] at vancouvercondo.info 7 Jan 2010 3:10 pm and 3:56 pm – “I’ve got a word of advice for you: M_O_V_E”… “I’m sure from your […]

ReadyToPop

The key take-away from the charts and summary is this: the

(written in 2006…RTP)

Japanese bubble was not in housing, it was in lending. The same is true of the U.S. bubble which is just beginning its deflation. If all mortgages had continued to require 20% down in cash and well-documented sources of income, the bubble would have run out of buyers long ago.

What We Can Learn from Japan's 15-Year Decline in Real Estate

Anonymous

@SpitfireS: When smart capital exit it leaves other no where no rugs underkneth,If people don’t fear stock will lose only 50 cents instead of it’s entire value,Warning to all the middle class people there, most of stocks result runs with institutional news agenda all the big fishes enter with the news making story beofre and after hour trading,gain in the daily stock price always been aquired by institutional investors that kill all the middle class people by forcing them to buy at highend and they exit before the next set of news made by same people.so better buy Vancouver real estate.if you ever find bunch of jokers in real estate market they can not harm Vancouver real estate.

SpitfireS

@E. Benedict: "Well, somebody ended up with all that cash that everybody else lost."

and observer #25

I would have just told E Benedict to look up the definition of stock volume, because somebody does not end up with all the cash the everybody else lost. It is not a system where 1 dollar in produces 1 dollar out.

Drachen

@Dave: "Stick to the message, not the messenger." Well that's where we have a problem. I'm not saying that in this particular instance you're out to lunch but the fact is you're consistently one of the most biased people on here with regards to how you cherry pick your sources, pick up on any argument which is for your case without regard to it's validity and ignore all arguments which you cannot adequately counter-argue. In this instance I think the Maui-Vancouver comparison is a red-herring, you know full well you have some ammunition so you're going to empty the magazine in spite of the fact that it's a completely tangential subject which has no bearing on Vancouver real estate. So, to summarize, your point may or may not be accurate but it is certainly irrelevant. Is that sticking to the… Read more »

Anonymoose

I'm really looking forward to the Olympics being over with. The latest nonsense is those electronic signs popping up in the middle of traffic saying "Hooray for stuff!!!" or something. They've actually stuck a few of them up in the middle of the bloody road where people have to swerve around them.

On of these today said something along the lines of "Try to reduce driving trips during the Olympics!" Vanoc has gone mad – they appear to be under the delusion that they are relevant to planning my personal daily agenda.

Guess Again

Dude,

Why is that you surface, then get put in your place, disappear for days, or come back under another name. Buddy, you have admitted too much too many times on this post for anyone to believe you. Everyone knows you live with you parents, and then you have not travelled anywhere. You have no frame for comparison, so don't pretend you do. It does not matter what name you post under, you always get called out.

And by the way, the "Iranians" have been here since 79/80. What they scooped up, they did decades ago.

Supraboy

@VRENGD: That's a dumb comment, have you been to Australia before? I've been to all those cities that you have listed. Barcelona's a great place to practice Spanish and do nothing all day. Unemployment is ridiculously high there. London's a sad city in the winter. What a dumb fool, why don't you move there and find out? It's a good place to stay for one year, that's about it.

That population growth chart is not correct. It hasn't accounted for the amount of Iranians scooping up North Van. Population has more than doubled in the past 5 years in the entire lower mainland. More cars, more people shopping, more people going for dim sum. I was just having dim sum today, packed as usual. It was never like this 5 years ago.

Dave

@Drachen:

Stick to the message, not the messenger.

The obvious point I made is that freehold and leasehold are not the same and valuations shouldn't be compared. I personally wouldn't touch a private leasehold property. Others are willing. If you are going to compare Hawaii prices to Vancouver (silly to do to begin with), then you have to consider the property ownership situation. In Vancouver, leasehold property is significantly devalued. What do mansions on the Musqueam Reserve go for? Half? If so, then you might as well double the price of that $150k Hawaii unit to make any type of comparison to Vancouver.

Miracle

Oh Superlittleboy, We cannot all exhibit the same social retardation that comes from living in your parent’s basement playing PS3 all day, and relying on them to take care of all of your basic needs. Your pronouncements are risk free, as you have no skin in the game per say, and rely on the same fallacies promoted by those that have experienced little in life. As for me, I have owned and rented around the world, never tied to one place. A house has, and always will be, a home as opposed to a defining measure of my worth or an investment to be monitored daily. For me, life is about experiences and that includes interaction with new places and people. For you, my little Vanboylover or supraboylover, life will be about an indebted existence in one tiny locale. Back… Read more »

VanLoverBoy

Hey Miracle, I'm sure from your cheery disposition you've got to be one of the renters who has missed the boat. Too bad. Go start out somewhere better, like Africa, MiddleEast or one of those other notasgoodasvancouvermiddleofbumf—nowhere places you're in love with. Good luck with that.

Say Again

76

Are these the same real estate experts that predicted a 13% decline for 2009 after the downward trend in Summer/Fall of 2008 was confirmed? Odd, how they predict price drops when the have already started, and price gains when they have already taken place…..yup, pretty reliable…..

vreaa

@SD92129: Thanks for the comment, your point is completely valid. Ironically, even though I collect anecdotes ("stories from the bubble"), I am fully aware of the limits of anecdotal evidence.

As I've seen summarized elsewhere – "The plural of anecdote is not data".

See my discussion of the rationale behind collecting anecdotes, despite these limitations, here ->
http://tinyurl.com/yb8lb42

Drachen

@Disbelief: I vote Dave down when he's being disingenuous or polemic. The biggest problem with Dave is that he has an ability to create reasonable sounding arguments from the thinnest of resources and unless you check his sources you might actually believe what he says. His ability to construct an argument shows that he has enough intelligence to understand how systematically he uses logical fallacies and unreliable sources to sway the gullible into believing his line of crap. In this he reminds me of the 'lunatic fringe' down in the states on every issue from Global Warming, the bogus claims of a link between inoculation and autism, Anti-Evolutionism etc. His kind of thinking is dangerous because it takes a fair degree of intelligence and diligence to see how hollow the arguments are and most people are just too intellectually lazy… Read more »

logic

"X VanLoverBoy Says:

January 7th, 2010 at 2:15 pm

Tons of snow at Whistler and the rest of the events are indoors. "

———-

You have no fucking idea do you. Been up to Cypress yet, where at least 6 of the more popular events are being held? The snow is apalling (it's like late April snow, it's that bad), and even with the snowmakers going 24/7 it looks very very bare.

Miracle

Oh Vanboylover, what wonderfully simplistic response, much in line with your IQ and your beige character.

Actually, once I finish fleecing your provincial government with a few more consulting contracts, I will indeed move – just in time to avoid the coming cuts in service, increase in taxes, and Olympic debt. Of course, I will be leaving with an actual net worth not a paper net worth like 99% of the population here.