With the current real-estate market here most people seem to agree that property is getting too expensive in Vancouver, particularly for first-time buyers. Opinions differ on what that means for the future, most people who earn their living through real estate seem to be of the opinion that prices will stay the same for a while (plateau), increase very moderately for the next few years (about the same as inflation) or dip slightly. Others take a more negative view, pointing to Vancouvers history of manic depressive real-estate price swings, including a one year 40% drop in house prices in the early eighties.
With the current build-up of houses and condos for sale and months of dropping sales its starting to look like we’ve hit the market peak – so how many are waiting on the sidelines to buy? If prices start to drop who will jump in to make sure they don’t drop too much?
If you’re looking to buy in Vancouver, but are currently ‘priced out’ or have found better places to invest your hard-earned money, what would convince you to buy in Vancouver? What do you feel is a reasonable price to pay for a house or condo in Vancouver? What about specific areas: the downtown core, kerrisdale, grandview, collingwood, etc.
Whether you own or rent in Vancouver, if you’re living near the center of the city chances are you live in a small space. Apartment Therapy is a site that focuses on tips to make your space more liveable, from color to decor, layout and renovations. If you’re looking for decorating tips or just some mindless consumerism to chase away the autumn blahs you might find something interesting on their site.
Looking for a condo in Vancouver but waiting for prices to drop? Well here’s some real estate price reductions for you in central Vancouver.. Is this the beginning of a slide in home values or a small dip before prices rocket back up again? I’ll leave that for you to decide. Price drops here range from $10,000 to $40,000. All of these listings have been on the market for more than 90 days, and all links lead to the property listing on MLS.ca
6460 MAIN ST – Original price: $395,000 | Asking: $369,000
“Bonus of $1,000 for accepted offer by August 15”
888 PACIFIC ST – Original price: $449,000 | Asking: $419,900
“Wake up & enjoy building amenities..”
1099 E BROADWAY – Original price: $349,900 | Asking: $325,000
“Faces Broadway but quiet inside”
336 E 1ST – Original price: $339,00 | Asking: $319,000
“Easy parking rental in building.”
950 CAMBIE ST – Original price: $488,000 | Asking: $478,800
“close to all amenities & other new buildings”
550 BEATTY ST – Original price: $429,000 | Asking: $415,000
“Upgraded kitchen cabinets for those who don’t want the conventional”
1238 BURRARD – Original price: $429,000 | Asking: $405,000
“Market rent $1650/mo.”
3788 W 10TH AV – Original price: $458,000 | Asking: $438,000
“Quick access to UBC and downtown.”
189 NATIONAL AV – Original price: $480,000 | Asking: $440,000
“Bright open kitchen with granite countertops“
6026 TISDALL ST – Original price: $279,000 | Asking: $265,000
“35% down payment required. Adult building.”
There are more listings, but I grow weary of typing. If there is interest I’ll make this an ongoing feature.
No this isn’t news for Vancouver, but it is about ways of predicting the future of the housing market. This MSNBC article talks about some of the different methods of analysing the housing market and how they all end up with pretty much the same view: the largest expected housing declines in the US market will be in some of the markets that were previously the hottest: Miami, San Diego, Las Vegas, Washington D.C. and Boston to name a few.
Mark Zandi, chief economist at Moody’s Economy.com released a huge housing report last week, predicting house price drops next year by as much as 18.6 percent in Cape Coral Florida, a 17.2% decline in Reno Nevada and a 15.7% drop in Stockton California. To conduct his analysis, Zandi looked at the supply and demand of housing, changes in mortgage rates, demographic trends, the job market, and new housing.
The other angle on real estate price prediction comes from the Chicago Mercantile Exchange which began trading futures and options contracts on housing prices in 10 markets across the U.S. in May. Investors are predicting declines in all 10 cities listed on the CME over the next 12 months.
The article points to the way these two approaches to prediction yeild some similar results:
“In the cases where they cover the same ground, Zandi and the CME traders have some uncanny similarities. For instance, Zandi expects San Diego to drop 8.4% through the second quarter of 2008, while the futures market is expecting a drop of 8.2% by August, 2007. In Washington, Zandi expects prices to drop 12% through the second quarter of 2008, and the futures market expects a 7.7% decline by August, 2007.”
It will be interesting to see how accurate any of these predictions turn out to be. On one hand you’ve got an economist who has done a lot of research, and has a single point of view. On the other hand you’ve got a group of people, potentially from all walks of life, putting up money betting against future house prices. Either way it looks like prices dropping across the USA and if that ends up happening this will be first decline in US national house prices since the Great Depression.
There were a few interesting articles in the sun this weekend about the Vancouver housing market: The first article action urged for affordable housing talks about the cost of renting in vancouver and the squeeze put on older low cost rental stock as it is converted into condos for sale. The second article is one from last friday and is titled developers face threat of oversupply.
Over the last four months sales have dropped and listing have risen prompting some to ask if we’ve reached a tipping point in the Vancouver real estate market. With thousands of new condo units to be finished in the next couple of years, sales levels dropping off and low levels of immigration to the Lower Mainland are we in danger of being over-supplied in the condo market?
If current rental rates are putting the squeeze on renters, but still can’t cover the average mortgage cost on a equivelent unit, what happens to rent prices? What happens to sale prices?
Silver lining: Sounds like its about time for everyone in Vancouver to get a healthy pay raise! Go let your employer know!