The spin continues though: stable market, stable market, history, history, historical, blah, blah, blah.
Fact is, January saw less sales than December, typically the slowest month on the calendar. Single family home prices bounced around like a cat on the 'nip too. It's a buyers market by any definition you want to use.
Here's the VREB release.
Here's the breakdown, including a month over month comparison.
January 2011
Net Unconditional Sales: 339
New Listings: 1,187
Active Listings: 3,283
Months of Inventory: 9.7
Sales to new listings ratio: 28.5%
January 2010 totals
Net Unconditional Sales: 418
New Listings: 1,211
Active Listings: 2,793
Months of Inventory: 6.7
Sales to new listings ratio: 35%
December 2010
Net Unconditional Sales: 349
New Listings: 522
Active Listings: 3,252
Months of Inventory: 9.1
Sales to new listings ratio: 67%
Percent changes YOY
Net Unconditional Sales: - 19%
New Listings: + 8%
Active Listings: + 15%
Percent changes MOM
Net Unconditional Sales: - 3%
New Listings: + 44%
Active Listings: + 1%
You've probably noticed I'm placing less importance on reported price changes lately on the blog. It's not that I don't care, per se, OK, actually it is, but regardless, here's what the VREB has to say about their own reported average prices:
January 2011
SFH: avg = $603,401 med = $576,000
TH: avg = $447,792 med = $418,050
Condo: avg = $323,002 med = $293,000
January 2010
SFH: avg = $636,345 med = $585,000
TH: avg = $453,013 med = $399,250
Condo: avg = $313,337 med = $299,900
December 2010
SFH: avg = $647,063 med = $565,000
TH: avg = 434,783 med = $415,000
Condo: avg = $301,671 med = $285,000
If you're out there active in the buying pool, word to the wise, don't believe the industry spin and don't get caught with your pants around your ankles just because you can't fathom the idea of living another year paying someone else's mortgage. There is no fire. No need to run when you can crawl.
Fact is, January saw less sales than December, typically the slowest month on the calendar. Single family home prices bounced around like a cat on the 'nip too. It's a buyers market by any definition you want to use.
Here's the VREB release.
Here's the breakdown, including a month over month comparison.
January 2011
Net Unconditional Sales: 339
New Listings: 1,187
Active Listings: 3,283
Months of Inventory: 9.7
Sales to new listings ratio: 28.5%
January 2010 totals
Net Unconditional Sales: 418
New Listings: 1,211
Active Listings: 2,793
Months of Inventory: 6.7
Sales to new listings ratio: 35%
December 2010
Net Unconditional Sales: 349
New Listings: 522
Active Listings: 3,252
Months of Inventory: 9.1
Sales to new listings ratio: 67%
Percent changes YOY
Net Unconditional Sales: - 19%
New Listings: + 8%
Active Listings: + 15%
Percent changes MOM
Net Unconditional Sales: - 3%
New Listings: + 44%
Active Listings: + 1%
You've probably noticed I'm placing less importance on reported price changes lately on the blog. It's not that I don't care, per se, OK, actually it is, but regardless, here's what the VREB has to say about their own reported average prices:
The use of average price information can be useful in establishing trends when applied over a period of time, i.e. six months or longer. The Victoria Real Estate Board cautions that an average price does not indicate the actual value of any particular property. Those requiring specific information on property values should contact a REALTOR.So even they think the numbers are pretty much useless when you want to apply them to a purchasing decision. Until Victoria gets tracked by a Teranet-style home price index that compares apples to apples, I'm not going to waste much time trying to analyze a number that fluctuates widely based on a whole slew of mitigating factors that few, if any, people can list or even scratch the surface of understanding on. But for those that do care, here they are without any commentary:
January 2011
SFH: avg = $603,401 med = $576,000
TH: avg = $447,792 med = $418,050
Condo: avg = $323,002 med = $293,000
January 2010
SFH: avg = $636,345 med = $585,000
TH: avg = $453,013 med = $399,250
Condo: avg = $313,337 med = $299,900
December 2010
SFH: avg = $647,063 med = $565,000
TH: avg = 434,783 med = $415,000
Condo: avg = $301,671 med = $285,000
If you're out there active in the buying pool, word to the wise, don't believe the industry spin and don't get caught with your pants around your ankles just because you can't fathom the idea of living another year paying someone else's mortgage. There is no fire. No need to run when you can crawl.
25 comments:
don't get caught with your pants around your ankles just because you can't fathom the idea of living another year paying someone else's mortgage. No need to run when you can crawl.
I wish I could draw the mental imagery that went with that description.. :) It wasn't exactly flattering to buyers or renters...
As for useless comparisons based on volatile data, all I can say average and median both down YOY. We've bounced off the price ceiling since Summer 2008, and now, with credit tightening for the foreseeable future, it's going to be quite surprising if it stays at these levels.
just because you can't fathom the idea of living another year paying someone else's mortgage
It seems to be you who can't fathom the idea that the reason we're not buying is that renters are in fact not paying someone else's mortgage, and if they were, we would be buying.
Easy there Patriotz, me thinks you've taken that out of the sarcastic context it's was meant to be. We're on the same team.
Does anyone recall how many Realtors there are in Greater Victoria? I'm just thinking that the majority of them must be "going hungry" after January's poor sales results.
By my calculations, if you purchased a rental property in 2004 you may be able to break even after paying the mortgage, repairs, property taxes, insurance, and possible management/strata fees. Based on the current rental market, it would be a challenge to break even (let alone, make a profit) on anything bought more recently.
I seem to remember 1200 from last year for realtor numbers...marko - can you corroborate?
And I imagine 95% of the sales are made by 25 of the realtors, leaving 75% happy January is in the rear-view mirror.
err...25% of the realtors...
Times Colonist Headline
Lots of noise in the data and lots of relative change in the number of houses selling in different areas (which would completely mess up medians and averages, but not a Case-Schiller type of statistic which we unfortunately don't have here), however the internet headline is quite satisfying for those waiting to buy.
DavidL, your calculations sound roughly correct to me. I was looking to purchase rental properties in 2005, and on average it looked like it was going to take 5 years to break even, assuming a hypothetical (conservative for the time) 7% house appreciation per year. Granted rental prices have gone up substancially since then, but I wouldn't be surprised if it still took years just to break even at current prices - and that's if there's no housing downturn (good luck with that!)
Mr.4AM
@ animal spirit,
If I was in the industry I'd be pissed by that headline. Leave it to the TC to do no analysis whatsoever on what the numbers actually mean. The race to the bottom of lazy journalism just keeps picking up speed with that rag.
If you've got a house on the market right now, that headline might make you a bit more motivated to accept a low ball offer should you be lucky enough to get one.
I still see nothing that makes me think prices are going to go up this spring.
HHV - I was attempting (and failed) to be discrete about the headline.
IMHO - and the reason for using Animal Spirit as my name on this forum - is that the bust will happen not out of numerics, but instead from behaviour change by the masses. For some strange reason, people actually believe what they read in the paper or hear on the television.
My instrangience to question what others tell me has got me into trouble over time, but in the long run it is much better to do due diligence, have integrity and base decisions based off of fact rather than emotions.
Most people don't do this, and therefore markets can be manipulated. The sword is double edged though - what comes up must come down. And the emotion of fear is just as strong as that of joy or greed.
A Buddhist would say the opposite emotions are the same and both lead to suffering. Just Jack would say something completely different and much more funny.
According to my calculations there are 1315 realtors in the VREB.
So 339 sales, we can assume that at least 90% were not double ended which brings us up to 339 x 1.9 = 644. We can also assume that a number of top Realtors did more than one deal so that would probably drop 644 down to, I don't know, wild guess, 400 Realtors were involved in a deal? Leaving 915 without a cent to show for January.
Secondly more and more money is being taken of the table in those 339 deals due to alternative business models which further
compounds the situation.
When I give 70% cash back on a deal, only 338.3 deals are really done as far as comission revenue goes, :)
me thinks you've taken that out of the sarcastic context it's was meant to be.
Getting hard to tell these days. I will do my best to lighten up :-)
It seems this winter is a little cooler for condominiums in the city than last year.
Back in January of 2010, some 93 condos sold in the urban core municipalities at an average price of $333,838 and an average days to market of 41. The median was about 10 percent lower at $300,000 and the middle of the data showed 28 days to sell. Last year $300,000 bought you a 915 square feet condominium ($328 per sq. ft.).
Last month, sales were down 22 percent showing a drop to 73 condominiums sold. The average ($313,254) and median price ($293,000) closed to within 6 percent of each other. And the time to successfully market a sky box zoomed to 65 for both the average and the median. And this year $293,000 bought a 964 square foot condominium ($305 per sq. ft.)
Comparing one January to the next January leads me to my opinion that the market is starting cooler than last year. Fewer sales from 93 to 73, slightly lower prices from $300K to $293K, fewer sales of expensive condos bring the median and average closer together. And people buying today, getting typically another 50 square feet (think - walk in closet) of floor space.
For a real estate agent seeing the days on market scream up to 65 adds a wind chill factor to the market. The typical listing contract is only 90 days long. The agent's have spent money and time advertising and showing the property, so if the client walks at 90 days, that's red ink. Time to extend the listing contract another 90 days and hope for a better market in the spring or drop the price and get it sold in the next 30 days.
I'm guessing a lot of agents are wearing their long john underwear this year.
If the mayor of Victoria, wanted to make affordable housing and encourage younger families to live in Victoria, one thing he should do is revoke age restrictions in Condominium complexes.
Today a 1,367 square foot condominium in Fairfield was listed for sale for $329,000.
I drooled. Even though the square footage most likely includes an unheated glass enclosed balcony.
But then....
Minimum age restriction of 19 years.
Would child services take my five year old daughter away - if I tattooed a moustache on her?
Just Jack: The reason that condo is selling in the low $300K is that it DOES have an age restriction. If it didn't, it would be listed at a much higher price. I think when people retire for instance, they are entitled to buy a "retirement" condo as after years of raising kids and sometimes grandkids, they just want the peace and quiet of an adult only complex. The kids can still visit. Although the age 19 min. seems a bit much. I am talking ones where the age restriction is over 40 and does not allow rentals. Once you allow rentals (unless it is a 55+ bldg), then one can not discriminate as to to the age of the renters. When you have bldgs where there is an age restriction and no rentals allowed, you can buy in cheaper but then you have to sell cheaper as well. That's the trade-off.
On another note: So far on my pcs this week, i.e. SFH, min two beds two baths in the four core municipalities, with a price range of $375K - $775K, I see only one sale. It sold for $710K and is assessed at $853K. Wow.
I don't buy into that argument that just because you are a certain age, you can discriminate against others. Stereotyping and over generalizing people based solely on age. Its nonsense. If your worried about noise - pass a noise bylaw - worried about skateboards in the hallway - pass a bylaw. But don't pass a bylaw restricting people under 19 because they are noisy skateboarders.
Age restrictions are the last remains of a prejudicial generation. The restrictions are arbitrary and should be non enforceable.
And besides, some of these condos have three bedrooms and wood burning fireplaces and are in nice locations. You could actually raise a family in one of these. So yeah, I'd like to have one of these older condominiums in a choice location.
It sucks to be young and really really good looking.
Agreed regarding age restrictions.
Back in 2002 a friend of mine, who was in his late 20s at the time, bought a condo. A limited number of rentals were permitted. Within a year after he bought his condo, they passed a bylaw saying seniors only, although obviously people already residing couldn't be kicked out.
And yet, his neighbours all agreed that they never disturbed them, but the mostly deaf person across the hall disturbed everyone with her tv.
Another friend bought a townhouse in Oak Bay in her early 20s, with parental assistance. Their bylaws changed to seniors only as well. She was told that she was not permitted to have a child (or get married!) or they would force her to sell.
These sorts of things are an affront to human rights. We don't allow landlords to discriminate on the basis of age - it shouldn't be permitted for owners of common property either. Personally, I think that if someone decided to challenge the age restriction bylaws in court, they'd win.
Deanna,
I agree on the second example: "She was told that she was not permitted to have a child (or get married!) or they would force her to sell." That wouldn't likely hold up in court, though it would require a significant amount of money (or a Johnnie Cochrane-style "free" lawyer) to get it to the upper courts that would deal with charter issues.
As far as age restricted buildings go, I understand people's frustration but they're out there, enough people prefer them to make them still around and common property is essentially private property held as a collective. A strata corporation is a very different legal entity than a rental corporation which should be subject to Canadian charter law.
I'd hate to see private holdings (as in my house is my castle) subject to the whim of rights-based groups... while I generally agree with human rights law, they're enough fringe groups out there that would make that a can of worms I'd never want to see opened.
Stereotyping and over generalizing people based solely on age. Its nonsense. If your worried about noise - pass a noise bylaw
Well parents are going to jump down my throat on this one... but..
Our last apartment we had some new parents living above us. The hours of baby crying really got on our nerves. I totally understand age restrictions for anyone that wants a quiet building.
Ever tried to explain a noise bylaw to anyone under 5?
I've got two little kids, and at times they can be noisy. My wife and I, at times can be noisy. My 70+ year old father-in-law who lives in a suite downstairs can be noisy (he's totally deaf and shouts so he can hear himself when talking). I have yet to discover a proportionate relationship between age and noise.
I really dislike age discrimination - it bugged me as a kid, continues to bug me as a generation X-er and will bug me when I'm crotchety, old and deaf.
Pass some bylaws ... don't assume based on age.
There are limitation on what bylaws a strata corporation can approve.
A strata bylaw restricting blacks or Asians would be struck down. But why not a bylaw against single moms? Or an 18 year old soldier returning from Afghanistan that is not allowed to buy a condominium in his home town. He/she can fly an $18,000,000 jet but isn't permitted to live in a $200k condo in Victoria.
The crying baby scenario, is a silly one. Sound proof the baby's room. But that still doesn't explain why 3,4,5,6,7,8,9,10,11,12,13,14,15,16, 17 and 18 year olds aren't permitted.
No, its just a few grumpy grampas on the strata executive. Put a couple of Viagra in their meds and peace will prevail once more on the strata council. Personally, I would leave a Hustler magazine hanging out of their mail box for everyone to see before the next election. Then, take control of the strata council, and pass a bylaw that does not allow people over 55 to live in the building.
In a previous life I worked for G. Gordon Liddy.
Or an 18 year old soldier returning from Afghanistan that is not allowed to buy a condominium in his home town.
Yes, poor guy, homeless in the streets, because there is literally not a single building in Victoria that allows under 19s.
And what about that poor puppy dog, not allowed to live in a pet free building? Gazing at us with his big innocent puppy eyes....
All good examples.
The crying baby scenario, is a silly one. Sound proof the baby's room
That would be fine, if it ever happened. But the parents won't do it because they're not the ones with the problem. Why should they spend money to make it quieter for their neighbours?
But that still doesn't explain why 3,4,5,6,7,8,9,10,11,12,13,14,15,16, 17 and 18 year olds aren't permitted.
Those 55+ buildings must really grind your gears. After all, where do they get off saying that all those 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 and 54 year olds are so rowdy?
"I love the smell of respirators in the morning... The smell, you know that oxygen smell... Smells like, victor(ia)"
Rate hikes could spark house price collapse, economist warns
Steve Ladurantaye
Ottawa— Globe and Mail Update
Posted on Thursday, February 3, 2011 12:22PM EST
http://tinyurl.com/4ajqj5l
Any move by the Bank of Canada could “easily” cause house prices to collapse, Capital Economics warns in a bleak report that suggests the Canadian housing market is likely to suffer the same sort of crash that has plagued countries such as the United States.
The report suggests that house prices in Canada have climbed at the same pace as the in United States, but have not fallen at the same rate. In the United States, some markets have seen prices fall as much as 50 per cent through the recession.
As the bank raises interest rates, mortgages will become more expensive for Canadians. Add inflation to the mix, and Capital Economics predicts prices could fall 25 per cent over the next few years.
“Even small rises in official interest rates have been shown to have a big effect on homeowner confidence in other countries under similar circumstances as they can change perceptions towards the housing market very quickly,” said economist David Madani. “If the Bank of Canada does resume its monetary tightening this year, this could easily prove to be a tipping point for a house price collapse.”
Oops.... :-)
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