The following is a release from the GVREB which should not be confused with the Real Estate Board of Greater Vancouver (REBGV). This is what the GVREB says about itself:
“GVREB is a not for profit real estate bulletin prepared by industry analysts and market participants. Comments, information and questions can be sent to the general e-mail box at firstname.lastname@example.org”
Here’s their report on the market at the end of November 2012:
Firm trend of lower prices in Greater Vancouver as demographic changes bring motivated sellers to market
FOR IMMEDIATE RELEASE ON VCI
VANCOUVER, B.C. –December 3, 2012 – The pace of property sales slowed in November 2012 from October 2012 to be the second slowest month of November in the past 12 years. The slower selling pace combined with higher inventory levels continues to put downward pressures on home prices. In addition, the leading edge of a demographic change is appearing where aging home owners are selling their long-held principal residences in order to downsize in their retirement years. In certain higher priced markets, we are seeing older-aged sellers accept significant discounts on their asking price to complete their sale transactions. This is putting additional downward pressure on prices and setting the clearing price of the market lower. We foresee continued market weakness with no positive changes in macroeconomic factors expected in the next 18 months.
GVREB reports that residential property sales of detached, attached and apartment properties fell to 1,698 in November 2012, the second lowest total for the month of November in the past 12 years. This total represents a 28 per cent decrease compared to the 2,360 sales in November 2011. Contrary to mid-year predictions from local real estate market associations, the second half of 2012 has not resulted in an increase in sales from the first half but instead has continued to deteriorate.
November 2012 had a modest deterioration in sales pace which resulted in a seasonally unusual increase in the number of months of inventory. Prices also continued their downward trend with market-wide benchmark prices now down approximately 5% from their peaks in May 2012. With slow sales and high inventory, lower prices are now being set by the motivated and aging owners who desire or require their property to sell. These unlevered sellers are willing to accept very large discounts below their asking price in order to realize the large gains they have realized over their original purchase price. We believe this the front edge of a demographic trend that economists have predicted would occur.
New listings for detached, attached and apartment properties in Greater Vancouver totalled 2,750 in November 2012. This was more than 10 per cent below the seasonal average and 15 per cent below the 3,222 listings in November 2011. However, as sales have slowed more than listings, the sales to new listing ratio of 62.0% was the second lowest for the month of November in the past 12 years. The number of active listings at the end of November 2012 was 15,680. Inventory decreased approximately 10 per cent compared to the end of October 2012 while MOI increased to 9.2.
The Residential Reference Price for all residential properties in Greater Vancouver over the last 12 months decreased by 1.2 per cent to $600,200 in November 2012 from $607,200 in October 2011. From the peak price level in May 2012, prices have now decreased approximately 5 per cent in those 6 months.
Sales of detached properties in November slowed to 637 units, a decrease of 30 per cent from the 916 detached sales recorded in November 2011, and a 39 per cent decrease from the 1,050 units sold in November 2010. On a monthly basis, the number of sales November 2012 was down almost 20 per cent from October 2012 and fell at a rate much higher than that of the attached and apartment segments. The reference price for detached properties fell to $916,000 compared to $936,200 in November 2011.
Sales of apartment properties fell to 752 units in November 2012, a 25 per cent decrease compared to the 1,000 sales in November 2011, and a decrease of 28 per cent compared to the 1,052 sales in November 2010. In the past 12 months, the reference price of an apartment property decreased by 2.2 per cent to $362,500 from $368,600.
Attached property sales in November 2012 totalled 309, a 30 per cent decrease compared to the 444 sales in November 2011, and a 24 per cent decrease from the 407 attached properties sold in November 2010. The reference price of an attached unit decreased 3.1 per cent from October 2011 to $459,000.