Jan 26 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.

	Jan 2015				Jan  2014
	Wk 1	Wk 2	Wk 3	Wk 4
Unconditional Sales	83	165	265		342
New Listings	286	541	786		1090
Active Listings	3020	3121	3198		3489
Sales to New Listings	29%	30%	34%		31%
Sales Projection	--	302	342
Months of Inventory					10.2

Should be somewhat above last year's total given accelerating sales pace, but likely not a lot.  About 360-370 I'm guessing.

2015 Predictions

"I'll bet rates stay at 1% for another year." - me two weeks ago.
Well I'm not getting any more accurate, but at least I'm wrong more quickly.

Time to lay it out for 2015.   We're in the middle of some pretty momentous changes with oil (and oil related investments) dropping through the floor.  Now the Bank of Canada has surprised everyone with a rate cut.  Will the rate cut stimulate the local housing market with lower mortgage rates?  Or is it a sign of a slower economy that will drag on the market?

How are those numbers doing anyway?

Current prices and HPI.  Median down a bit in recent months.

Months of inventory

Annual rolling averages.  Months of inventory still going down at a good clip.  Prince increases flattening out lately.

Sales to new listings.  Still trending positive.

Relative to peak prices.

Affordability bigger picture stuff.  Income gains and interest rates drops causing affordability to steadily increase.

The 5 year lending rate recently cracked an all time low at 3.98%.    Looks like the journey down isn't quite done yet.

This year I'm guess we will see the Bank of Canada battle outright deflation.  If oil stays low for a while longer things won't look so pretty, and it might cost the conservatives the government in the fall.

In Victoria, I'm guessing a small improvement over last year's numbers but more or less more of the same, with the month over month increases petering out by springtime.   Prices will remain the same pulled down a bit by more first timers entering the market.
Total sales:  7200
2015 Average SFH price: $610,000
BoC Interest rate:  0.75%
Teranet June 2015:  138
Teranet Dec 2015: 140

New years prediction roundup

End of the year and the annual numbers are in.   How did we do in last year's predictions?

	Leo	Koozdra	Marko	Caveat Emptor	Patriotz	Reasonfirst	ACTUAL
Sales	6200	5300	6400	6000	---	6100	6699
SFH 6 month average	$580,000	$550,000	$585,000	$565,000	---	---	$609,342*
BoC Interest Rate	1%	0.5%	1%	0.75%	---	1.25%	1%
Teranet June 2014	128	130	132	131	129	128	136.2
Teranet Dec 2014	124	126	131	128	124	125	TBD (Nov: 138.2)

* The 6 month average SFH price does not appear to be published anymore. This is the annual average.

Overall we all sucked.   Marko wins for being closest on every measure; that's why he gets paid the big bucks.

 Other predictions:
"House prices across the Canadian housing market may peak in 2014. Victoria's big price declines will likely begin after the Canadian housing market peaks and it is evident that house prices across Canada have begun to correct." - Info

"further controls will be added to the mortgage market but I think at least one of them will be head line grabbing. I'm going to go with regional caps re-established on CMHC insurance." - Koozdra  (some minor tweaks happened)

"I think we will see a drop in prices of approximately 5% by December (in Oak Bay)" - totoro

"In short, 2014 to early 2015 will see a sharp transition. This will result in either a significant increase in MOI or significantly lower prices; probably a combination of both." - LeoM

"MLS HPI (2014): - 4%" - Info (Actual: Up 2.1%)

"Any generalized market prediction would be meaningless in this market." - Just Jack

Assessments are also in and overall seem to be pretty flat except for in the periphery.

In important economic news, oil prices below $50 a barrel.  How long can the oil sands withstand operating at a loss before those camp jobs start evaporating?