Vancouver Condo Info

From the Vancouver Condo Wiki - Expert Quote-tracker

Pani sent in this link to an International Money Fund research department write-up on falling house prices in advanced economies and their impact on the macroeconomy.  There are some interesting global stats on housing market cycles there:

Between 1970 and 2005, the average house price cycle in advanced countries lasted about ten years, with an expansion phase of six years during which real house prices increased by about 45 percent. During the subsequent four-year contraction phase, real house prices declined about 25 percent, with the range of declines across countries varying from about 10 percent in the United States to over 30 percent in Japan and several European countries.

Of course the question is how much is the current contraction phase like the average?  And housing cycle contractions don’t always occur during recessions or credit market contractions.

Evidence suggests, not surprisingly, that the macroeconomic consequences are more adverse if they occur against the context of a weakening economy and tight credit conditions, which is likely to be the situation facing many countries at present.

Over the period 1960 to the present, recessions in advanced countries that are associated with house price busts and credit crunches are slightly longer and deeper than other recessions. The duration of a recession is more than one quarter longer in the case of a housing bust, total output loss during the recession is somewhat higher, and the unemployment rate increases notably more and for longer in recessions with housing busts.

According to the IMF research, when a housing bust happens during a recession it can double unemployment rates compared to a housing bust that occurs without a recession.

At the end of July we posted an excel spreadsheet that YLTNBoomerang is using to track the market for Downtown waterfront Vancouver townhouses.  YLTN just sent in the updated data so I’m posting it here for anyone interested in this part of the market.  There are a few empty spots in this update as summer is vacation time.

The information in this spreadsheet includes square footages, new listings and price changes from January 10 until September 15th 2008 (today).  The entire database is color-coded, with red indicating price increases and green indicating drops.  There have been a few increases since the original posting, and a flurry of price drops over the weekend.

Click here to download the XLS document.

I’m posting this data with the same challenge as the original post: If you can graph this data in an interesting and informative way I’ll post it here, just email it to me.

update: bcubbins has added selling price data from land titles to this spreadsheet and posted it here.  Most of it seems to be going for 5 to 10% less than listing price, the shocker is a unit at 1280 Richards that went for 32.8% less than listing price.  Is that correct bcubbins?

This is a pass-off post to Paul Boenisch at nvcondos.ca who has just posted some dramatic month-end June stats on his blog.

If you haven’t seen these numbers yet, or if you have any doubt that the Lower Mainland real estate market is undergoing a dramatic shift, check them out now.  Supply continues to grow while sales keep dropping.

Here are a few highlights:

Sales down 41% from June 2007
Inventory up 53% from last year
North Vancouver inventory up 113%

Check out Paul’s blog for all these stats and more graphed out for some dramatic visuals.

So far prices haven’t been impacted much at all, but increasing supply and decreasing demand will put pressure there unless this dramatic shift reverses soon.  Could we be in danger of tracking the US market?

Umdesch4 posted this updated REBGV inventory chart this weekend, showing the dramatic listings activity we’re seeing this spring in Vancouver. That purple line shows how inventory is building beyond levels seen at any point in the last few years.

The monthly inventory graph comes from Paul Boenisch, who shares monthly inventory graphs for the entire REBGV and sub areas. This graph has been updated to the 15th of May based on the daily stats Paul makes available on his website. Pauls blog is here.

Spring is here and the listings are blooming like crazy. Both Vancouver and the Fraser Valley are being hit by a combination of fewer buyers and a greater number of owners looking to cash out. Here’s the REBGV listings chart for the last 4 years courtesy of Paul Boenisch:

Clicking the graph above will bring you to his blog which has additional graphs for sub areas- we’re seeing rapid inventory growth on the west side and north shore. Paul also tracks daily statistics on sales, price and listings on his website.

In the Fraser Valley listings are growing as well - They now have a near record amount of inventory. The following sales and listings chart for the FVREB was created by Mohican at Langley Financial Planning. Check out his site for more charts and detail on the Fraser Valley market.

It looks like growing inventory is starting to put some pressure on prices. Prices in all categories are up year over year, but the month over month figures look unusual for the spring selling season. The Benchmark price is down in all categories in North Vancouver, slightly up for houses and townhouses in Vancouver, but Vancouver condo’s and apartments saw their benchmark price drop by 3.16% in April. The spring market so far this year is looking markedly different from the last few years, we’ll see how this trend holds up into the summer.

I found this shocking bit of info over at Rob’s blog posted by Awum:

Here’s something I was wondering about. I heard anectdotally that Vancouver east side condos seem to be on a downhill slide as far as price goes. This morning I was reminded of http://www.landcor.com/market/housing_price_index.aspx to check it out, typed in Vancouver East, apartments, pushed refresh graph. Waited. Looked at the graph. Wow.

Other areas really don’t show so much weakness (I looked at a few) but Van East apartments looks like its in bust mode already. Looks like a 15% drop in HPI from peak. That’s a big deal.

Now before anyone accuses me of going all “Chicken Little” over this one piece of data, let me be clear about my point: The only reason for this drop in HPI that I can ascertain is plain old supply & demand. Too many properties for sale, not enough buyers with the required $$.

I have to admit I was very suprised to see that graph as well - I’ve always looked to the MLS Housing Price Index which doesn’t show any such correction underway. I tried to find information on the Landcor site on where they get their data and why it would vary so much from the MLSlink data and the found this page on their site which is heavy on buzzwords, but light on specifics:

The accuracy of Landcor™’s AVM is further enhanced by the quality of our data. We update our copy of BC Assessment Authority property information on a weekly basis. There are typically between 3,000 and 9,000 property information and sale changes each week. Our competitors in BC and across the nation typically update data stores once a month. Landcor™ has the most up-to-date information on property in BC.

So are East Vancouver apartment prices crashing as shown by the landcor data or are they remaining fairly steady as shown by the MLSlink data? I suspect the truth lies somewhere in between - It’s pretty tricky to ‘benchmark’ housing based on all the variables, but I’d be interested in hearing your opinion on this data.

I got this suggestion from were1non, who writes in with the following note:

I was just looking at the webtraffic statistics for mls.ca, and realtor.com to see if there was any correlation between the housing collapse and traffic to these two sites (mls.ca being the biggest listing site in Canada, and realtor.com for the US). I think this is an interesting time because this is the first time we can use web statistics to gauge interest in the housing market.

If we look at the alexa graph for realtor.com we see traffic start a steady drop in 2006, almost mirroring the US housing market slump:

Oddly enough, when you look at the traffic graph for mls.ca it does almost exactly the same thing, and as we all know there was no Canadian housing market crash in 2006:

So is it a coincidence that traffic drops off at realtor.com in 2006? Or perhaps there are competition factors at work here - my initial thought was that sites like zillow in the US and individual realtor VOW sites in Canada may have siphoned off traffic from these two main sites, but looking at a graph for zillow.com we see the same drop:

So whats happening here? Are we seeing interest in real estate fade in North America as a whole, is the traffic more evenly distributed, or are there other factors at work? One thing seems likely to me: it really is different this time - this is the first real estate boom that has played out online and no matter what happens the sheer amount of data, analysis and opinions that are out there and easily accessible is unprecedented.

update: David G from Zillow left a comment about the unreliability of Alexa data, Zillow traffic is actually up 30% over the year despite the condition of the US market.  These graphs track daily percentage reach and not absolute numbers but I still view them as an interesting proxy in the absence of more reliable web traffic data.

Speculation: Prices are going up, therefore prices will go up. Get in before you’re priced out forever. Its the only way to get really rich without even trying. Prices are practically guaranteed to go up forever. This time its different here.

Pent-up demand: Hey, we’re laid back in BC. We didn’t think about buying until everyone else thought about buying.

Rich Foreigners: We love it, we’ll take two, we don’t care what it costs. Do you have any magic beans for sale? We’re investing in magic beans as well, thats how we got so rich.

Leaky Condos: Its like NEW now! And its cheaper than the others! Lets buy it!

Low interest rates: Heck, the bank’s practically paying us to get rich.

Population growth: Ok, so population growth isn’t so hot. Still, you have to admit SOME people are moving here, just less than before the 90’s correction.

Income growth: Lets see now.. I could take on a paper route, mow a few lawns on the weekend and apply for that night watch job at the construction site.. maybe sell my plasma on the side… Yes, honey, we can make that mortgage payment!

Illegal drugs: Dude! heheh. This condo is wiiiicked! It’s like totally 3D! Quit bogarting the joint, pass the dutchie man! whoa. I can feel the shrooms kicking in, where do I sign?

WTF? We had great volume in July, lots of sales, but the benchmark house price didn’t go up at all. In fact at a benchmark price of $714,810 detached houses actually lost $905 in the month, hardly enough to get excited about, but shouldn’t prices be going up in a hot hot market?

Those at the lower end are still doing their part: Condos are up a healthy $4k from the previous month, while townhouses are up $5k, so what happened to the houses?