Second worst August since 1998

The REBGV has released their Vancouver stats package for August 2012 and it’s a bit of a downer for the true believer.

Sales down, prices down, lots of use of the term ‘buyers market’.

In fact the home sales plunge just made last month the second worst August since 1998.

The group’s composite benchmark price for all residential properties in Greater Vancouver is $609,500 which is down 0.5% from a year ago and 1.1% from July.

Supply seems to be slowing with new listings for detached, attached and apartment properties 4,044 in August for a 13.7% decline from a year ago. New listings were down 15.8% from July.

At 17,567, the total number of residential property listings on the MLS was up 13.8% from a year ago but down 2.8% from last month.

Courtesy of Good Format, here’s the month drops and what that number looks like annualized:

            MLS® Home Price Index  

           July 2012     Aug 2012   Chg(%)  Annualized(%)
Detached     950,200     942,100     0.86       10.32
Attached     468,700     462,300     1.38       16.61
Apartment    374,300     370,100     1.13       13.61

Scubasteve shares some of the worst hit areas for prices:

DETACHED
-3.7% = Richmond
-3.7% = Vancouver West
-1.3% = Maple Ridge

CONDOS
-8.0% = Burnaby South
-7.9% = Port Coquitlam
-6.4% = Burnaby East

TOWNHOUSE
-8.8% = Tsawwassen
-8.3% = Burnaby North
-4.5% = Maple Ridge

And the worst areas for sales:

1) West Vancouver (-65.6%)
Aug/12 = 34 sales
Aug/11 = 96 sales

2) Burnaby (-47.5%)
Aug/12 = 174 sales
Aug/11 = 331 sales

3) Coquitlam (-41.6%)
Aug/12 = 122 sales
Aug/11 = 209 sales

4) Richmond (-31.2%)
Aug/12 = 179 sales
Aug/11 = 260 sales

5) Vancouver West (-31.0%)
Aug/12 = 362 sales
Aug/11 = 524 sales

6) Vancouver East (-29.6%)
Aug/12 = 169 sales
Aug/11 = 240 sales

7) North Vancouver (-29.0%)
Aug/12 = 113 sales
Aug/11 = 159 sales

Read his full comment here.

If we don’t see a flood of listings in the Fall then that will help to let some of the downward pressure off the market, but there isn’t much looking up in the outlook.  We’re now a couple of months into the new mortgage rules that have taken out some first time buyers and put pressure on $1 million houses.

With housing affordability in Vancouver at a record low it’s only going to get trickier to find a buyer unless we get a new flood of credit or higher paying jobs.

 

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jesse
Member

I love looking at the “worst” but to round things out I think highlighting the “best” is worthwhile. From one spineless blogger to another.

ScubaSteve
Member
ScubaSteve

@jesse:

What “best” do you want highlighted? Only 2 cities in the entire REBGV had YoY increases in sales: Sunshine Coast and Whistler. Meanwhile, the other 18 cities has their YoY sales go down. What’s the bigger story here?

jesse
Member

@ScubaSteve: “What’s the bigger story here?”

That the “best” isn’t that good. At all. I think that’s an important observation because earlier this year that wasn’t true.

VMD
Member
rp1
Guest
rp1

Everybody relax. They can fix this. Cut interest rates to -3% and double the government’s backing of risky loans to 2 trillion.

Sparky_604
Guest
Sparky_604

I don’t get it. If it is common knowledge that you have to lower the price to sell your house in this market, how do prices remain stagnant? Is it the new MLS HPI that is skewing the numbers? Lying realtors?

When I read articles about RE prices nationally they always talk about prices in Vancouver pulling the national average down yet….prices here remain stable???

registered
Member
registered

1 jesse Says:“…I think highlighting the “best” is worthwhile….”

No reasonable person argues against considering the opposing view, but what added value does comparing August to other months have over sticking with apples-vs-apples? I think that risks accusations of moving goalposts to downplay extraordinarily bad news.

joe_blown_away_by_high_housing_costs
Guest
joe_blown_away_by_high_housing_costs
Vancouver Sun is trumpetting the strength of Vancouver’s commercial real estate and seems to be ignoring weak August sales for residential real estate (was there even a story about that in the Sun?). “Commercial real estate transactions in Metro Vancouver reached an unprecedented six-month total of $1.42 billion during the first half of 2012, breaking the previous record of $1.03 billion set during the first half of 2010, according to a report released Wednesday. The figures point to a longer-term surge and confidence in commercial land investments, experts say, but belie anxiety over diminishing industrial land availability as it gives way to more apartments and office towers. “One of the things that is striking about (the high sales numbers), and I think is probably driving a lot of the activity, is really the commercial side,” said Tsur Somerville, director at… Read more »
B. Panther
Guest
B. Panther

@Sparky_604: “I don’t get it. If it is common knowledge that you have to lower the price to sell your house in this market, how do prices remain stagnant?”

Prices are stagnant because people aren’t lowering their prices and sales are at almost all time lows.

Vote Down The Facts
Guest
Vote Down The Facts

@B. Panther:

There’s little distress in the market.

Bounce Overconfidence
Guest
Bounce Overconfidence

Yes, it is different this time, but the “new paradigm” will surprise. This time, unlike 2008, healthy panic will be delayed until too late. Liquidity at this point would suggest more upside. The market will go down light and one morning everybody will wake up to evaporated paper wealth and debt obligations exceeding their remaining lifetime earning potential. Many will declare bankruptcy and new laws will be enacted to make underwater mortgages non-dischargable in bankruptcy. People will be forced to disappear and take on false identities to escape their debts.

Anonymous
Guest
Anonymous

@Bounce Overconfidence: i cannot imagine the miserable life you are having! There is plenty of jobs outthere that people refuse to do it; because they think they deserve more.

Don Lapre
Member
Don Lapre

I’m lucky that all is have is the “good” debt that my REALTOR® recommended to build equity in the pre-sale condos I’m closing on!

http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/canadians-stretched-to-limit-as-moodys-warns-of-sky-high-debt-loads/article4523113/

patriotz
Member

@Bounce Overconfidence:
“Many will declare bankruptcy and new laws will be enacted to make underwater mortgages non-dischargable in bankruptcy.”

Yeah right. Harper is not going to turn over the keys to 24 Sussex that easily.

VHB
Member
VHB

LOL:

“The mortgage insurance rule changes that took effect July 9 will shave three percentage points off of home prices and five percentage points off sales, Toronto-Dominion Bank chief economist Craig Alexander predicts.”

http://www.theglobeandmail.com/report-on-business/economy/economy-lab/tighter-mortgage-rules-will-cool-housing-market-td/article4523084/

Anonymous
Guest
Anonymous

stupid bears keep saying interest rates have nowhere to go but up, guess what! a five years fixed can be had for 2.99%; down from 3.29% in the spring. how about that, stupid bears!

VHB
Member
VHB
Interesting comment on that Globe story: http://sitelife.theglobeandmail.com/ver1.0/gocomm?ck=CommentKey%3a67aaa99c-c945-4bc3-b4be-5196c46dd482 ” L Rob 11:32 AM on September 6, 2012 I’m a Realtor, an elected official and had lunch with a banker yesterday. The changes in qualification and to line of credit ratios appear benign but will actually have a big effect in debt driven consumer markets such as Vancouver lower mainland. Equity mortgages are basically dead. You must have income to support the mortgage and show where the income is originating via your tax form. Offshore investors slapping down 50% no questions asked are finished unless they show their declared income … not something they like to do. Downsizing boomers, we are now in the first wave, who planned on cashing in the home, putting some money aside for income and taking out a little mortgage for new townhouse or condo. are in… Read more »
Proud and extremely rich Chinese home owners
Guest
Proud and extremely rich Chinese home owners

@Bounce Overconfidence:
Because of Chinese hot money,Dow gone up 250 point this morning la,idiot.Chinese will start buying Vancouver houses in hundred a day coz there are ten of thousands…. wealthy Chinese immigrants like settling in Vancouver and China likes to establish a bridgehead here to extend its economic and military strangle hold on declining US.Vancouver will the beneficiary of Chinese investment.

Proud and extremely rich Chinese home owners
Guest
Proud and extremely rich Chinese home owners

@VHB: You are realtor,I am Chairman Wu.

Proud and extremely rich Chinese home owners
Guest
Proud and extremely rich Chinese home owners

@Anonymous:
That is call mental F up

Bounce Overconfidence
Guest
Bounce Overconfidence

@patriotz:

The smart ones will be planning their escape now, while things are still quiet. The really smart ones already have home, car, bank account under a false name so they can just take the money out and resume their legitimate identity with the proceeds of the scam.

Some humorous excerpts from http://www.panamalaw.org/how_to_disappear_one_step_beyond_asset_protection.html

What If I Make a Mistake and Get Exposed– Then you get to our law firm in Guatemala very fast and we start all over again. No worries, just expensive so try to be careful.

I want to Disappear – Ok come visit our law firm in Guatemala in person. We are not going to go into details on the phone or in email for many reasons including your own protection and the protection of our other clients….

Anonymous
Guest
Anonymous

@Bounce Overconfidence: It’s just sad to see these kinds of brainfarts voted up. Completely ruins our credibility.

Mort
Guest
Mort

@ScubaSteve: Those two areas that saw a sales increase have one other thing in common- last year they had abysmally low sales and prices have been dropping for more than a year.

jesse
Member

@fixie guy: “what added value does comparing August to other months have over sticking with apples-vs-apples”

Some areas cited — Coquitlam, Burnaby, North and East Van — that are now on the “worst” list were originally areas that were doing better than the headline Richmond/VW/WV weakness. That’s something I would highlight more strongly.

It’s like watching those waterhose carnival games at the PNE where horses run to the finish line. Those areas are fading.

jesse
Member

@VHB: Yes I think people underestimate OSFI’s resolve to curtail credit growth and properly implement Canada’s version of Basel III. Look at the latest Bank of Canada release — only a small reference to credit growth and it’s no longer a “risk”. Why is that? My guess is because they know what’s coming so it’s not a “risk” anymore.

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