Where did all the buyers go?

Well here’s a counterpoint to the huge number of Canadians that own homes:

According to RBC, the number of Canadians planning on buying a home in the next two years has dropped to a record low.

Sean Amato-Gauci, senior vice-president of Home Equity Financing with RBC, says current economic and industry trends are consistent with this bleaker homebuying forecast.

But an overwhelming majority of those polled (84 per cent) still see real estate as a sound investment. While 52 per cent say now is a good time to get into the market.

Nearly half of those surveyed (49 per cent) say they expect mortgage rates to be same this time next year, while 43 per cent admit they believe home prices will continue to climb.

All clear? Fewer people than ever are planning on buying, but a majority still see ‘real estate’ as a sound investment and more than half of them think now is a good time to get into the market.. but only 15% are actually planning on buying.

Will they still be planning to buy if prices keep dropping?

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Short'em High

@rails Says: “You do not need CIs to show that MOIs are outside the normal bounds” Church. Nevertheless, this method ultimately is about detecting and ranking outliers based on all the available information including sample size. It is definitely not trying to be a p-hypothesis testing procedure. A sensibly ranked and proportionate number is always better than simply saying “Believe me, that reading is high.” or “Pay no attention, it always does that.” Those sort of statements always lead to the inevitable lay-objections in small sample size of “How can you say that reading is high, when now they are all high?” or “Why are we not worried about this trial, yet that other one is interesting?” Tell me this. What is the downside to overestimating/correcting dispersion when trying to detect outliers in a small sample? Overestimating misses some borderline… Read more »


“where did all the buyers go”

They owe They owe, off to work (if they have one) they go, for the next 50 years at least..


sorry, but the key point is that your interpretation and use of the CI is wrong. Assuming you use a small-sample t to construct the CI, all you are really saying is that you are somewhat confident that the actual MOI falls within the sample distribution. don’t make things more complicated than they really are.

You do not need CIs to show that MOIs are outside the normal bounds defined by st. deviations.

Short'em High


This produces an “informed overestimate” as I said. Treating the computed MOI as sample population is simply trying to get at the question of significance of large or small readings in the tiny sample rather than answering some fundamental economometric question.

Regarding information, more is extracted/presented because the notion of sample size is being adjusted for rather than being left to the imagination of those reading a narrative about the current (9th) reading. For example, bullish commenters are eager to use the single high mark in 2009 to justify a “new paradigm” where 7 MOI is the expected value for March. Yet, in reality, most readings for March are far lower and are even sufficient in number to produce a mathematical confidence interval by an objective calcuation.


use of the t-stats with n=8 does not not provide much information. Your sample is much too small to generate material information. Additionally, I am trying to understand why you are even using CIs and t-tests for this.

CIs and t-tests (not in the context of regression analysis), are use to figure out whether true population parameters fall within a sampling distribution. i.e. we are X% confident our CU captures the true value of the population parameter.

While deviations from mean is an appropriate analysis (with more data), CI’s and t-tests are not

Short'em High


Yes, and the data distribution is even more skewed or bimodal in other months, so the simplifying assumption of central tendency must always be closely examined. Luckily your basic non-adjusted MOI for March is coherent enough to demonstrate the t-distribution inference using 7 of the 8 data points.

Please do give that dependendent variable idea a try. If a more coherent adjusted MOI can be discovered, t-distribution inference could bring every month in this small data set into sharp focus.


I would also normalize for working days, ie Inventory/salesperworkingday is probably slightly better.


I’ll post my April MOI data, which I have unverified back into the 1990s. MOI has been higher. MOI is highly nonlinear, it is incorrect to use symmetric t in my view.

Interesting though!

Short'em High

March MOI Question. Is it high, low, or don’t know. I am using @jesse’s March MOI numbers from 2005 to 2012 below. (BIG thanks to @jesse for posting his data!) year MOI 2005 2.7 2006 2.3 2007 3.1 2008 4.4 2009 7 2010 4.3 2011 3.2 2012 5.3 Because there are only 8 samples I use the t-distribution to estimate a 95% confidence interval for the “average March” MOI. From @jesse’s graph we see March falls in a narrow range of MOI except in the year following the financial collapse in the US. Therefore, the March 2009 MOI data point is initially discarded. avg MOI 3.614 stdev 1.075 samples 7 stderr 0.406 t95 2.447 lowest likely average MOI 2.620 (95% confidence) highest likely average MOI 4.608 (95% confidence) Combining the worst case average MOI (lowest and highest) with the estimated… Read more »


Fraser Valley RE Board
March 1-27
2013 New List:2383, Sold 965
2012 New List:2522, Sold 1122 (-14%)

Brian Ripley

Re the RBC piece: “But an overwhelming majority of those polled (84 per cent) still see real estate as a sound investment.”

I just updated my Knight Frank tables of High Net Worth Individuals and their changing views of which cities they want real estate in:

To the question “Is the number of homes your clients own likely to increase or decrease?” the responses globally increased from +19% in 2012 to +25% in 2013 … a 32% increase in interest/desire to add more real estate to their portfolios.

People with money are still bullish on real estate. They are no doubt watching or experiencing Cyprus/Eurozone and thinking it’s time to buy more hard assets.

Notice that Montreal has hit the HNWI radar, Vancouver is rising in popularity and Toronto has checked all the boxes!

Short'em High

#46, I do see the MOI log scale graph per link below.


Interpolating pixels on a log scale without a grid isn’t going to lead to satisfactory values for March. Do you have a linear scale graph somewhere that you can share?


totally off topic but am I the only one that has lost Global TV? Survivor cut out right at the immunity challenge…wtf


See housing analysis blog for the MOI data from 2005, graphs should be accurate enough for ttest


Huh, and they’re selling silver. How convenient – that should save me from the conspiracy 😀

Many Franks

@Left already living in San Diego: Interpreting “options for resolving these institutions without the use of taxpayer funds” as “planning ahead for the confiscation of depositor funds” is more than a little wing-nuttish. That bit in the budget was referring e.g. to the higher capital ratio for systemically important banks.

Left already living in San Diego

After having inflated the biggest real estate bubble in history, is the Canadian government being prepared to rip off the savers again, this story is scary…better go and buy an overpriced house after all!

Short'em High

#28 Says: “March was seasonal low for MOI since 2005 except for 2009”

, what are the March MOI numbers for every year you have? I’d like to calculate and share with the forum a t-test confidence interval for the typical March.

Best place on meth

“Not going to see big price decreases with an MoI of 7.”

Not going to see big price decreases in Feb/Mar/Apr.

May onwards is a different story.

Many Franks

In the Vancouver Sun: Metro real estate market shows signs of spring

The article starts with a hopeful anecdote and then crashes into the dirt and wallows in gloom until its dismal finish. “Spring” here is totally literal — no metaphorical buds on the metaphorical trees. The only optimism they can muster is a below-normal seasonal uptick.

Bull! Bull! Bull!

>Not going to see big price decreases with an MoI of 7.

Don’t worry bears, “there’s always next year”!


Total days 20
Days elapsed so far 19
Weekends / holidays 8
Days missing 0
Days remaining 1
7 Day Moving Average: Sales 126
7 Day Moving Average: Listings 220
Sales so far 2256
Projection for rest of month (using 7day MA) 126
Projected month end total 2382
Listings so far 4540
Projection for rest of month (using 7day MA) 220
Projected month end total 4760
Sell-list so far 49.7%
Projected month-end sell-list 50.1%
Inventory as of Mar 27th, 2013 16559
MoI at this sales pace 6.95

MoI is at 7. Like it has been all month. 7 is just a bit over the magic breakeven point of 6, so that makes it a fairly neutral market. Not going to see big price decreases with an MoI of 7.


Ouch – so much for the bullish recovery in sales.

94/241 < 40%

I am assuming the long weekend will be busy for open houses. The wife and I bid on a house 10% below assessed and owners were offended that it was $100,000 below what they were asking. Then I stood back and thought – wow, 10% = $100,000 prices are ridiculous.

Anyway, the seller came back with an ask of 3% below assessed.

The realtor said, "Well, I think it is worth that much and that nothing has gone below 5% from assessed. And, the owner knows an asian buyer can come by"

I didn't put in a counter offer.

Bull! Bull! Bull!

lol, now low commissions are going to make to make the market crash. that’s a new one.