February 2013: The ‘underwater’ point.

Looks like statistics from last month are starting to show up now.

Over at the Vancouver Sun they’re leading with the headline stat that YOY sales are down almost 30%.

The REBGV Home Price Index (HPI) is now down 5.6%, which Aleksey points out means that people who bought last May with the minimum down payment are now ‘underwater’ on their mortgages.

It’s been quite a while since we’ve seen this happen, but we’re now at a point where a small number of recent Vancouver home buyers owe more for their property than their property is worth on the market.

How long till we see the term ‘underwater’ or ‘upside down’ when it comes to Vancouver mortgage holders in the news?

With sales and prices down, REBGV president Eugene Klein did find one market indicator that is up: Realtor anecdotes of visitors to open houses.

Sales in February followed recent trends and were below seasonal averages, though our members tell us they saw more traffic at open houses last month compared to the previous six to eight months.

Somebody should tell the Vancouver Observer so they can correct this article again: What does it mean when nobody shows up to an open house in Vancouver?

“Well, this is a bit odd.” The Realtor checks his phone again, but it’s not saying anything new.

It’s been an hour, and nobody has shown up to the open house. We’re standing on the ground floor of a townhouse.

The Downtown East Side, but it’s silent except for CBC Radio 3: classical music plays quietly from tiny, beautiful speakers that can probably only play classical music. Top-40 would cause them to implode.

The Realtor walks out the door, across the long, wide patio, to the front gate of the courtyard. He’s making sure his phone number is correct on the open-house announcement. It is.

A bright, sunny Saturday in Vancouver. Just after lunch, and there’s nobody here but us.

100 Comments
newest
oldest most voted
Inline Feedbacks
View all comments
Anonymous
Anonymous
7 years ago

Are you kidding me? Engineers are smart in math but not in other ways?

That is something stupid people like to tell themselves to make themselves feel good for being stupid.

“I bet he’s books smartz but I’m street smartz” … most engineers I have met, and other people that are good with numbers, are also better writers, speakers, and have better social skills than those not good with numbers. Not all but most.

It is like that myth that jocks are stupid – most people in sports that I have met are actually quite sharp – they live a health balanced life.

Anonymous
Anonymous
7 years ago

….Enough of alluding to Engineers as being smarter than ‘cops’. Intelligence is measured in many ways. Engineers may be good in math but lack in many areas……….

Well, they’re smart enough not to be cops so they got something going for them.

Anonymous
Anonymous
7 years ago

….Not to mention the guy is probably working as a transit cop making another $125,000/year on top of that. ..

He’s probably won the lottery too. And I bet he has good looking kids. And, just to add insult to injury, there’s a high degree of likelihood he has a full head of hair. Yes, it should be illegal fore someone receive a pension and be working (even though that someone contributed heavily to their pension). If nothing else, if you’re receiving a pension, you should’n be allowed to work in an area where you have some expertise.

Next: Those old farts with huge RRSP’s and million dollar houses should not be getting a discount on the bus!

Anonymous
Anonymous
7 years ago

…Just because you went to school longer than a for example a longshoreman doesn’t mean you should earn more….

But I thought everybody complains that you need a degree to be a longshoreman these days?

Anonymous
Anonymous
7 years ago

RealProfessional

Enough of alluding to Engineers as being smarter than ‘cops’. Intelligence is measured in many ways. Engineers may be good in math but lack in many areas…

Anonymous
Anonymous
7 years ago

Real Professional, Landbaron:

Obviously my comments are meant to shock you.

The point is there is no right or wrong. What may appear correct to you, based on your moral underpinnings reinforced by society/educational system, may appear wrong to others. Who says your way of thinking is the moral or the Centre of reference?

The only truth is what is around you right now. And longshoreman are making more than most. But don’t think it’s an injustice just because it doesn’t fit into your view of life. Having said that, life hasn’t changed much at all…it’s still survival of the fittest.

Landbaron
Landbaron
7 years ago

Anonymouses, whoever you multiple people might be, get a name!! I’m still laughing at the longshoreman reference, yes people who go to school ‘deserve’ more money then them! In the 90’s I worked in a fish plant on the DTES docks. I was 16 yrs old making $20 an hour in a non skilled job with no experience. I was told to ‘slow down’ on multiple occasions as I was making the slow workers look bad. It was a union company and 2 years later it was closed because of high costs, what a surprise! The only people who took their job seriously at the place were the ones going to school! Most of the useless workers had ‘friends on the docks’ and that’s where they ended up…now making well over $100k a year as longshoremen while the good workers… Read more »

VMD
7 years ago

Battle of Vancouver: SFH Front – Feb 2013 Battle Update:
– As predicted in January, Bear Forces successfully invaded Port Coquitlam and N Delta.
– Charged with triumphant spirit, Bear Forces also liberated West Vancouver, Port Moody, and Tsawwassen.
– The following Bull Territories are facing imminent defeat: Coquitlam & Cloverdale
– Coquitlam is where the Last Stand of Bull Forces in REBGV takes place. The Bulls are down to the Very Last tank battalion. If they are defeated, the Bulls will be chased South of Fraser River, and possibly soon, South of the Border.

Link #1: http://vancouverpeak.com/Thread-Battle-of-Vancouver-SFH?pid=620#pid620

Link #2: (smaller pics, good for seeing 5-month trend)

Short'em High
Short'em High
7 years ago

#86 Says: “general economic optimism”

Can you give an example of believable optimism somewhere in the media?

The herd can know something is wrong for a long time before individuals realize it is their herd in peril and the danger is exactly on the spot where the individual is standing. People are funny that way. It’s always something like this. “Who, me? That can’t be right…”

http://en.wikipedia.org/wiki/Illusory_superiority#.22Self_versus_aggregate.22_comparisons

real_professional
7 years ago

Wow – I read your post again and I am dumbfounded at what you have to say. If tax payers dollars are used to inflate the salaries of government administrators, police officers, and the like …. THEN, it is effectively taking dollars away from other areas of the economy that could possibly generate greater innovation. It is through innovation that economies become great and true wealth is generated. Also, by skewing wages versus other market alternatives – these types of positions create a vacuum sucking talent into the black hole of the unskilled tax payer funded workforce. The impact of these positions, is significant. Young would-be entrepreneurs that would otherwise take a chance and open a business, instead work among the government minions simply because the risk/reward dynamic is so skewed towards saftey and inflated benefits of government work. As… Read more »

Groundhog
Groundhog
7 years ago

Not sure what optimism is being referred to. The juiced up and irrelevent Dow jones index? Look at the Canadian exchanges.

Other then the US stock exchange, I don’t see much optimism anywhere.

VMD
7 years ago

@#86 Anonymous
” ..but does this general economic optimism not worry you?”

G&M: Canadian consumer confidence dips on job market worries

Mar. 01 2013

“The consumer confidence index fell 2.2 points to 80.8 in February, with the board noting the economy shed almost 22,000 jobs in January according to Statistics Canada.

While the slip was attributed to concerns about future job market conditions, the board said there was little change last month in Canadian attitudes about their prospects for future income.”

– granted BC was the lone province to score a gain (1.2%) in confidence. One could wonder if this slight increase in confidence in BC is justified.

real_professional
7 years ago

their = there

real_professional
7 years ago

@83 If you went to school you would have been able to read my post. To clarify, I didn’t say, as you put it, that people who go to school should get paid more. I said, what’s the point of going to school. You see, believe it or not, most people entering university do so with the end goal of getting a job. It is also true that in most parts of the world, formally educated people make more money than those who are not formally educated. Going to university is not only a lot of work, papers, exams etc.. it is also very expensive. Students often finish school with student loans that take years to payoff. In addition, their is a huge opportunity cost – especially if a person is missing out for years on high paying jobs that… Read more »

Anonymous
Anonymous
7 years ago

I’m totally with you guys about Vancouver being way overpriced and all, … but does this general economic optimism not worry you? I wouldn’t be surpriced if the market picked up in the spring and we had to wait a while for a significant drop in prices.

Landbaron
Landbaron
7 years ago

@83

I assume you took the 6 week realtor course? Good luck with that

Landbaron
Landbaron
7 years ago

@82

Does your realtor friend work for MAC, cause that happened 3 weeks ago..

Anonymous
Anonymous
7 years ago

#72 Real professional:

Why do you equate number of years of schooling with salary? Who made that law up? you?

Just because you went to school longer than a for example a longshoreman doesn’t mean you should earn more.

You are so lost.

Anonymous
Anonymous
7 years ago

Got off the phone with a friend who is a realtor. He says its been crazy selling the since 3 weeks ago. What happened 3 weeks ago to ignite this?? Seems like those 152 sales today are from 3 weeks ago. It will be true if we see a 200 sales day!

Theta
Theta
7 years ago


#76

In English “Own” rhymes with “Loan”

…as in “in order to own local people need a massive loan”

VMD
7 years ago

For those who think sales are ‘high’

Sales for first 3 business days in March:
2013: 345 (Fri/Mon/Tue)
2012: 404 (Thu/Fri/Mon) (-15%)
2011: 578 (Tue/Wed/Thu) (-40%)

Monday+Tuesdays tend to be high recorded-sales days (due to weekend carry-over effect). I’d bet by this Friday, the Year-over-year sales decline will be worse than -15%. Time shall tell..

jesse
7 years ago

March 2012 dailies:
sell newlist
123 313
163 251
118 338
163 298
71 260
152 237
69 229
120 306
133 238
146 290
133 238
180 208
97 224
193 319
158 267
153 238
136 219
127 303
162 268
104 259
151 239
average 136 264

My estimate, based on average sales growth from February to March in years since 2005, is 112. I overestimated last month, predicting 99 average daily sales with actual being 95. Will March suprise on the upside? Right now it looks like sales are better than February’s, but hey, this happens every year. If Vancouver’s market has found its groove again, expect a couple of 200+ sales days.

bust a nut on your face!!!
bust a nut on your face!!!
7 years ago

Wow!! 152 sales today!!

VMD
7 years ago

Looks like paulB’s busy tonight.
As a potential buyer in the next 1-3 years, I’ve recently contacted Paul to help me keep an eye out for my target units. Looking forward to working with someone whom I can trust. Another realtor acquaintance of mine just told me “you rent, you lose” (In Mandarin, “rent” rhymes with “lose”) – that guy just lost my business.

– alright, time to get started on the Battle of Vancouver maps. Hoping to get the SFH one done in the next hour or so, stay tuned..