Wednesday, June 26, 2013

Alberta floods: black swan that kills the market?


Calgary, arguably Canada's centre of economic growth, is slowly drying out after a massive flood event that few were warning about even 24 hours before the Bow and Elbow Rivers started hammering the downtown core and surrounding neighbourhoods with flood waters unrivaled since the 1930s.

This most definitely could be an economic black swan that affects all corners of our great nation.

A black swan is defined as "an event that is a surprise (to the observer), has a major effect, and after the fact is often inappropriately rationalized with the benefit of hindsight."

Pundits are already suggesting that Canada's GDP reporting numbers will shift as a result. I've read stories suggesting that Calgary--not to mention Canmore, High River, Medicine Hat and communities in between--has roughly $5 billion worth of damage. These numbers will certainly climb as businesses feel the trickle down effect of once-disposable cash being pulled from the economy to be spent on things like foundations and drywall. The richest province in Canada most certainly will be borrowing money on the open market for the first time in a decade.

And the Calgary housing market will most definitely be affected.

Given the fact that Calgary's wealthiest neighbourhoods were some of the hardest hit, and Calgarian's penchant for holding second homes on Vancouver Island and the Okanogan, I suspect that these markets could suffer, at minimum, a minor ripple effect.

Exactly what happens elsewhere time will tell.

 

Monday, June 24, 2013

June 24 Market Update

MLS numbers update courtesy of the VREB via Marko Juras. These numbers are for the Victoria Real Estate Board's reporting area, including Sooke, Shawnigan Lake and the Gulf Islands.

June 2013June2012
Wk 1Wk 2Wk 3Wk 4
Uncond. Sales173
341
506

637
New Listings418
7301002

1449
Active Listings4809
4848
4863

 5189
Sales to New Listings
41%
47%
50%

 44%
Sales Projection692
682
675

Months of Inventory
8.1

Market contines to outpace last year by a bit, partially because of increased sales and partially because of significantly reduced new listings.  Will interest rates rising be this year's big event?  

Monday, June 17, 2013

June 17 Market Update

MLS numbers update courtesy of the VREB via Marko Juras. These numbers are for the Victoria Real Estate Board's reporting area, including Sooke, Shawnigan Lake and the Gulf Islands.

June 2013June2012 
Wk 1Wk 2Wk 3Wk 4
Uncond. Sales173
341


637
New Listings418
730

1449
Active Listings4809
4848


 5189
Sales to New Listings
41%
47%


 44%
Sales Projection692
682


Months of Inventory
8.1

Trend continues.  Slightly higher sales, slightly lower listings than the same period last year.  Lots of bubble talk in the media and chatter about changes at CMHC, but so far nothing concrete has come out in the open.  Whatever happens with CMHC will be the key development in the housing market this year.

Monday, June 10, 2013

June 10 Market Update

MLS numbers update courtesy of the VREB via Marko Juras. These numbers are for the Victoria Real Estate Board's reporting area, including Sooke, Shawnigan Lake and the Gulf Islands.

June 2013June2012 
Wk 1Wk 2Wk 3Wk 4
Uncond. Sales173



637
New Listings418



1449
Active Listings4809



 5189
Sales to New Listings
41%



 44%
Sales Projection692



Months of Inventory
8.1

Beginning of month sales predictor says to expect 606 sales.   Pretty much a repeat of last year as it has been for a while.  July 2012 is when the mortgage change bombshell hit and tanked the market for the next 8 months.  Will we get a similar hit this year?

Also, just how slow is this market?   We know sales are near decade lows, but how does it compare to the 90s?   Thanks to a simple man for providing the population data which allows us to adjust for the growth of Greater Victoria...


So inventory is around the same as it was in the correction of the 90s....


While sales are the lowest relative to population that we've ever seen.   New listings are about middle of the road.  Expect them to continue to decline.

Monday, June 3, 2013

May numbers

Preliminary post until the VREB releases the summary for the month.  Thanks to  Marko Juras for the early update.

May May
2013 2012
Net Unconditional Sales: 659 659
New Listings: 1,428 1,740
Active Listings: 4,783 5,015

Sales are dead on to the number recorded last year.  Last year also had the same number of business days, so the sales rate is precisely the same.  New listings are down 18%, and for the second month we are down YoY in terms of inventory.