House prices never go down in Vancouver, except when they do.
But what about Toronto? The city that seldom thinks about BC?
Prices are up 11.8 per cent from a year earlier.
“In fact, there’s anecdotal information that suggests that foreign investors … are now turning to other cities that are not as expensive as Vancouver, because even that market’s gotten out of reach for wealthy foreign buyers.”
A separate report from real estate agents showed a 2.4 per cent monthly rise in sales in October and a 14.6 per cent surge in annual prices as buyers rushed to get into the market before tighter mortgage rules could take effect.
Taken together, the data showed Canada’s market cooling in most markets outside of Toronto, where a building boom and rising household indebtedness have spurred fears of a U.S.-style collapse if borrowing costs, already rising, spike further.
“Almost all seems to be well in Canada’s housing market, with most regions enjoying moderate sales activity and price gains, Alberta’s hard-hit market stabilizing, and Vancouver’s zany market returning to earth,” Guatieri said in a research note.
“However, accelerating prices in Toronto and its surrounding areas will only increase the chance of a correction if interest rates rise too sharply … and the chance of that happening is now somewhat higher under a new U.S. president.”
Read the full article over at BNN.ca
The great real estate market pause of 2016 seems to be creating some losses out there. Southseacompany pointed out this article that finds 3 homes selling for less than they were purchased for:
Vancouver real estate often gets hailed for excellent returns, but this one has us scratching our head. Three single family detached homes have listed for less than the owners paid for them. The kicker? They were all purchased less than 8 months ago. Is this the beginning of the end for Vancouver’s market or are we just insanely good at finding deals? Check out the listings and you can decide.
The rough estimated losses on those properties range from $73k to $125k if they sell for asking. View all three listings over at BetterDwelling.
Sales are down and prices have been flattish lately, but developers seem to be taking a ‘wait and see’ approach as BC housing starts saw a big drop in October.
CMHC says the pace of urban housing starts picked up in Ontario last month but there were declines in Quebec, the Prairies, Atlantic Canada as well as British Columbia
The annual pace of urban starts in B.C. fell to 25,517 in October compared with 46,294 in September.
Bank of Montreal senior economist Robert Kavcic said British Columbia was the big story.
“We’ll see if this level of activity, particularly in Vancouver where starts fell to the lowest since 2011, holds in the months ahead in response to softening demand conditions,” Kavcic wrote in a note to clients.
The drop in home starts in Vancouver comes as real estate sales in the region have also fallen sharply in recent months.
Read the full article over at BNN.
Vancouver area real estate has stalled for the second month, with the biggest drop in West Vancouver, but no big crash yet and prices are still way up from a year ago. The biggest drop is in sales:
The number of sales made in the region dropped dramatically in October 2016. There were only 2,233 sales, a 0.9% decrease from last month. Oh, your real estate agent said it’s seasonal? It’s a 38.8% decrease from last October. Pretty sure that was the same season last year. Agents typically interpret this as sellers seeing less value in selling right now. Conversely, less units for sale typically means lower inventory, which could push prices higher… eventually.
Read the full article over at betterdwelling.com
Yvr2zrh posted a snapshot summary for what’s currently going on in the market:
So – Here are some interesting takeaways from the numbers yesterday.
1.) Across Canada, you saw the impact of the mortgage rule announcements. Markets most likely to be affected by this rule change saw a spike in transactions.
2.) REBGV region is likely going to be the only region in Canada which saw a transaction volume decrease from September to October. This shows how soft it is.
3.) In REBGV – The components outside the 15% tax zone had the lowest sales decrease for detached (VWS, VIS, VMR, VSC).
4.) Zones with most concentrated foreign investment are having largest volume decreases. West Van leads with Burnaby and Richmond coming up next. Van West Detached had a pretty good month, comparatively. (Perhaps the tax auditors will start to pull apart those transactions to find some GAAR violations for the new taxes!).
5.) Prices are down for detached in almost all markets. In REBGV, only the zones outside the tax area are up. Although down, VVE and VVW have the lowest decreases in the 3-month range. West Van, Burnaby, New West and Port Coquitlam have the largest decreases so far.
6.) In the FVREB area – the most amazing statistic was the very large increase in sales of apartments. This has to be showing that people rushed to purchase to beat the mortgage rule changes.
7.) FVREB – Detached are doing poorly with White Rock showing the most significant sales decrease.
8.) Van West apartments – one of the largest apartment markets – was noticeably down in volume and price. This is counter to the trend in apartments. Perhaps this is showing the impacts of the new AirBnB rules and vacant home tax. Investor demand should now basically be capped unless they are buying to rent – – which is a terrible proposition at todays prices. Thus – we are now already seeing the impacts of the new rules – before they are even in place. Next step will when rules force current owners to re-assess their situation and likely sell (if you don’t want to rent to long-term renter – you won’t be able to be hold a second home or rent to Air BnB – – too costly and illegal respectively).
9.) Trends? From September to October – the following were the most significant declines in significant markets: Maple Ridge – Apartment, Burnaby – Detached, North Van – Apartments, Richmond Detached, Van West Townhouse, Port Coq Apartment, Van West Apartment.
– – Strangely enough – Van West Detached was modestly stable.
There’s the current month thoughts. Overall – a pretty good price decline. If we get any month over 1% across the market as a decline – that’s pretty significant.