BC quarterly sales drop more than 25%
Landcor data is out and in the first three months of 2010 both the number and value of BC real estate transactions dropped more than 25% from the previous quarter.
The results quantify the trend economists such as Cameron Muir, chief economist for the B.C. Real Estate Association, have observed occurring since January.
Landcor’s numbers “certainly support the data we’ve been looking at that shows that obviously the pace of sales have slowed since the last quarter of 2009,” Muir said in an interview.
Last year’s “fourth-quarter peak is unlikely to reoccur in 2010.”
Landcor president Rudy Nielsen said B.C. home sales typically slow at the beginning of the year, but the first-quarter of 2010 slowed more than usual compared with the last decade of results. This is in part, he believes, because of the Olympics.
Nielsen added that consumer uncertainty over a host of issues, ranging from the global economic situation to unknown effects of the harmonized sales tax, have consumers sitting on their wallets.
The agency, which insures almost $500-million of Canadian mortgages, said the average cost of a home by the end of 2011 should be $350,000. That would be a gain of 1.4 per cent over April’s record high of $344,968.Forecasting higher prices next year puts the agency at odds with the Canadian Real Estate Association and Toronto-Dominion Bank, both of which are calling for prices to drop by 1.5 per cent and 2.7 per cent respectively in 2011.
It has been difficult to accurately make forecasts on the housing market through the recession, however. Its forecast for 2009 housing starts was off by 19.4 per cent. The agency was only off by 1.5 per cent the previous year, and its goal is to always be within 10 per cent of the actual figures.
“For the first time in several years, our forecast accuracy was not within the 10-per-cent range because of volatile market conditions,” it said.
A ten percent margin of error eh? Coincidentally Dan in Calgary points out that the phrase ‘CMHC is forecasting’ is a perfect anagram for ‘Comic things, farces‘
May 22nd, 2010 at 10:15 pm
@Care Bear:
I feel ya Care Bear. I've been thinking the market's gonna correct since about 2001. It started in California in 2006-some areas are already about 50% down from peak, a lot of high end areas are still in denial.
I see signs of lower prices in places like Kelowna and Tri-Cities and the massive increase in inventory means it's all coming to a head soon. There's a saying that crazy markets don't last, they just last longer than you can stay solvent…
May 21st, 2010 at 1:29 am
@Vansanity: Its the boomers. They have equity (so aren't affected so much by recent changes) and are moving up and down in the market. I don't understand it, but their need to constantly buy and sell real estate is making the realwhores undeservedly rich.
After watching the odd behavior of my parents peer group, I'm convinced that boomers alone could keep sales going for a bit longer. You don't need FTBs. Of course, inventory will continue to build…until POP.
May 21st, 2010 at 12:13 am
I haven't been checking my emails regularly and just came across one dated April the 8th from Woodwards District:
"In 2006 you registered for Woodward's and participated in a little piece of Vancouver real estate history. … etc
For more information and a private showing of one of our remaining 12 homes priced from $425,000, including 2 show suites outfitted by Koolhaus, please call so-and-so."
All units @W were sold out, how many buyers walked out? Curious
May 20th, 2010 at 11:43 pm
just got my "Mr. Housing Bubble" t-shirt in the mail. Man, I wish I had it last week during my visit to the Olympic Village.
May 20th, 2010 at 11:37 pm
After living through the housing bubble in America, I watched with bemusement the growing housing bubble in Vancouver since I moved here. The shocking part is it is actually worse here in Vancouver than it ever was in the states.
What I am gobsmacked by is how mean and nasty people are to each other here, especially to renters. In the alternate reality universe of vancouver, the ability to borrow other peoples money to purchase a home somehow makes you better than a person who rents. Even if you are a gangster, but a homeowner, you are somehow better than the so called bitter renters.
I love that movie, It's a Wonderful Life. I think people here need to take a good hard look at the themselves- are you Mr. Potter, the greedy banker, making it harder and harder for the little guy to own a home, through greed and avarice? Speculating, flipping properties, often lying? Look around you. How many George Bailey's do you know? Not many I suspect.
The irony is that Vancouver paid lip service to being sustainable, and turned itself into the least sustainable city in the world.
What people dont realize about bubbles, is that the ending is written long before the story is finished being read. It always ends one way, badly.
If nothing else, maybe next time you will be a little bit nicer to your fellow canadians, a little more we, we, we, instead of gimme, gimme, gimme. Because this bubble has burst.
Its all over but the tears.