| August 2013 | August 2012 | ||||
| Wk 1* | Wk 2 | Wk 3 | Wk 4 | ||
| Unconditional Sales | 181 |
462
| |||
| New Listings | 337 |
1025
| |||
| Active Listings | 4661 |
5034
| |||
| Sales to New Listings |
54%
|
45%
| |||
| Sales Projection | 568 | ||||
| Months of Inventory |
10.9
| ||||
*Week 1 being 7 weekdays
Strong start to the month with 16 sales/day compared to 13 last year, and fewer listings this year. Looks like the recent mortgage tweaks were necessary to beat down a resurgence in this market. Beginning of month predictor said 477 sales, but it seems the market is up for a late summer hurrah.
268 comments:
«Oldest ‹Older 201 – 268 of 268Info,
are you really comparing Canada to Portugal, Greece and Spain????
Those countries are perceived to not have the economic ability to pay their liabilities (their bonds). That is why people dumped their bonds, and why interest rates went up.
Do you really think Canada will not be able to pay it's bills?
Not even the same planet when it come to economies... olives/some tourism versus 200 years of oil...
Canada will be fine.
This is Spain....
"Spain's development ministry estimates there are 687,000 unsold new homes for sale. Other studies put the number as high as 1.6million in the nation of 47million. There is no government figure for used homes for sale, but estimates range into the millions."
Anyone have the stats for Canada's unsold new home inventory?
"Last month this pathetic blog told you to expect 2013 to be the year that the new, sexed-up, Carney-less Bank of Canada raised its interest rates. Twice, in fact. Both increases, I suggested, would come late in the year, likely when the bank does its thing around Labour Day and again just past Thanksgiving."
There's a Garth prediction from last December and re-iterated in January. It's not exactly going out on a limb to say he will be wrong on Sept 3rd and wrong again on October 22nd.
CFA Joe said
"are you really comparing Canada to Portugal, Greece and Spain????"
Spain debt per person = $22,306
Portugal debt per person = $25,440
Greece debt per person = $32,578
Canada debt per person = $45,288
http://www.economist.com/content/global_debt_clock
CFA Joe said
"Those countries are perceived to not have the economic ability to pay their liabilities (their bonds)…Not even the same planet…olives/some tourism versus 200 years of oil...Canada will be fine."
Google
"a recent study estimates Spain's shale gas resources to be around 50 trillion cubic feet…50 trillion cubic feet would provide enough natural gas to meet domestic needs for at least 39 years, and there is even the chance for that volume to be increased by as much as 100% "
Spain the energy powerhouse and exporter???? Less than half the debt per capita as Canada.
Spain will be fine ;)
Canada? :(
Monday, August 19, 2013 8:00am
MTD August
2013 2012
Net Unconditional Sales: 305 462
New Listings: 568 1,025
Active Listings: 4,663 5,034
Please Note
•Left Column: stats so far this month
•Right Column: stats for the entire month from last year
a recent study estimates Spain's shale gas resources to be around 50 trillion cubic feet
Global rank of natural gas production:
Canada - #3
Spain - #83
"200 years of oil”
The problem isBC has no oil. Provinces own their natural resources. BC is in trouble mostly cuz it was relying on natural gas production. Hopefully Spain will be smarter as it develops its natural gas industry.
Declining revenue leaves big hole in B.C. budget, boosting deficit to $1.146 billion
"We've seen the largest debt increase in the history of British Columbia,"
yep, Canada unemployment rate is 7.2% Spain is 26.9%. How can you even compare the two? The biggest difference is Spain IS screwed. Canada....well some think it MIGHT be....
Five signs that you are in over your head
This author is grossly uninformed. In Canada you don't need to save. All you need to do is "get in the game". Property appreciation is the only savings vehicle you need.
As long as you can service your mortgage at historically low rates, you'll be fine.
Easy to compare. Spain's unemployment rate was 7% too before their bubble popped.
Relevant Spain vs Canada difference.
Canada - control over monetary policy, can devalue currency in a crisis.
Spain - no control over monetary policy, stuck with overvalued currency.
Right now in Gary, Indiana you can buy a home for $1.00. About 1/3 or 10,000 of the homes there are abandoned. To qualify, the income level for one person must be $35,250. Most homes need repairs in the range of $35-$50K. If you live there for five years, the house is yours!
Relevant BC vs Rest of Canada. (Spain vs Rest of Europe)
BC - no control over monetary policy (interest rates), stuck with overvalued currency and soon to be stuck with much higher interest rates because neighbouring provinces are booming.
The similarities are oh so many...they are both even on the western fronts of their respective unions!
Google: " Canadian home sales edge up, housing starts to stabilize."
"more evidence Canadian housing market has absorbed last years mortgage rule tightening and that the overall market remains balanced & well behaved" BMO Senior economist.
"despite the bearish figures pointed at Canada's housing market, sales have rebounded 11% from Feb's low and now sit almost right in line with 11 year average"
CREA's home price index rose 2.7% in July from a year earlier to record high.
Sales were led by double digit gains in Vancouver, Calgary, Edmonton and Toronto.
5 year Fixed rates are going up.. time to consider Variable rate.
Can we still call it "variable rate"? I mean we know for sure that the government won't raise it's overnight lending rate. They should change the name.
And with interest rates nearly doubling lately here and the U.S, mortgage applications are collapsing.
--gulp--
Americans must not have the 90-day rate hold options like yours truly. Imagine how high averages are being skewed down there, as the only buyers left are the ones paying cash for the ritzy homes.
Looks like people are figuring out Canada has twice the debt per capita as Spain...yikes.
"Not even the same planet when it come to economies... olives/some tourism versus 200 years of oil..."
Then you must apply that logic to Victoria. With your logic, Victoria's housing market will crash because of its weak economy. Victoria's economy seems to be a lot like that of Spain, Greece, etc., having tourism and no oil.
Net public debt is higher as percent of GDP in Spain than Canada.
Unemployment:
Remarkable the similarity between this graph:
and the first graph in here:
^StalJ
Are you predicting that BC unemployment will hit 27%? Over what time frame do you expect that to happen?
Canada will not reach Spanish levels since we have high labour mobility amongst ‘our union'. If the underwater Spanish homeowners could easily migrate to say Germany for work, their unemployment rate would have remained near 10%.
BC unemployment rate would be well above 10% already but so many jobless continue leaving for other provinces or commute to Alberta for work, keeping our rate down.
I think BC under age 25 will reach Spanish levels as it already "hovers at 20% -- and many young people without jobs have given up looking for work, and are not counted as unemployed."
http://www.bcgeu.ca/campaigns_and_issues/youth
Spain now has a brighter future as their price-to-rent ratio is nearing USAs and their longterm average, while Canada is still almost twice our average, BC even higher. Spain has almost reset like the States.
..and by the way, Spain has much higher natural gas reserves than BC. Just another reason Spain has a brighter future..now I have to run and buy me some mediteranean villas for 30k a piece : )
Spain - 50 trillion cubic feet ++
Canada - 58.2 trillion cubic feet
BC - only 18.3 trillion cubic feet
"The Ministry of Energy and Mines believes the province has a gas potential of 8.5 trillion cubic metres of tight gas, 7 trillion of shale gas, and 2.8 trillion of coalbed methane."
http://www.energybc.ca/profiles/naturalgas.html
"Spain now has a brighter future as their price-to-rent ratio is nearing USAs and their longterm average, while Canada is still almost twice our average, BC even higher. Spain has almost reset like the States."
This highlights the fact that Canada has a lot of resetting to do and it will not be a pleasant experience for most Canadians.
Canada's debt problem during the Great Financial Crisis that started in 08-09 was temporarily alleviated by creating a lot more debt. You cannot fix a debt problem with more debt. Ask the governments of the US, Spain, Greece, Portugal, Iceland, Ireland, etc..
"BC unemployment rate would be well above 10% already but so many jobless continue leaving for other provinces or commute to Alberta for work, keeping our rate down."
BC's economy is weak and Victoria's economy is the weakest among all BC cities.
StalJ
Labour mobility is indeed key. In the last 40 years there has never been more than 4.5% difference between unemployment in BC and Alberta. The biggest inter-provincial differences anywhere in Canada have been on the order of 12% between Newfoundland and ON, AB and SK at various times.
Interestingly the only time in that period that BC rates were approximately the same as Alberta was early 90's.
The energy sector doesn't account for nearly as much of the Canadian GDP as what most housing bulls think. The way they talk, you would think that the oil and gas industry is 90% of GDP.
It isn't like that at all.
Housing related industries (heavily stimulated) account for much more of the Canadian GDP than what most Canadians think.
"BC's economy is weak and Victoria's economy is the weakest among all BC cities." any proof of that?
"BC's economy is weak and Victoria's economy is the weakest among all BC cities."
"any proof of that?"
It was in the news about a month ago.
A quick look puts construction and Real estate, and rental and leasing at around 13% of Canada's GDP
http://www.statcan.gc.ca/daily-quotidien/130328/t130328a001-eng.htm
"BC's economy is weak and Victoria's economy is the weakest among all BC cities."
LOL
UNEMPLOYMENT - Jul 2013
Victoria - 5.5%
Vancouver - 6.6%
Abbotsford - 8.2
Kelowna - 8.1
Only one region of BC with lower unemployment than Victoria, that is the northeast
"BC's economy is weak and Victoria's economy is the weakest among all BC cities."
It was in the news about a month ago.
Miss Info
Vancouver, Abbotsford and Kelowna all experienced job losses in July. Victoria was the only CMA to post a modest gain in employment.
Here:
Victoria lost jobs in July as well
TC, Aug 9
http://www.timescolonist.com/business/greater-victoria-labour-market-mirrors-drop-in-jobs-across-nation-1.574701
Victoria’s labour market mirrored the trends nationally and in B.C. as the region shed about 600 jobs in July and the unemployment rate for Greater Victoria rose to 5.8 per cent from 5.5 per cent in June.
"UNEMPLOYMENT - Jul 2013
Victoria - 5.5%
Vancouver - 6.6%
Abbotsford - 8.2
Kelowna - 8.1
Only one region of BC with lower unemployment than Victoria, that is the northeast"
Again, this does not take into account that many unemployed have left Victoria in search of jobs elsewhere.
Umemployment numbers are not the only metric that can be used to gauge the strength of an economy.
Canadian housing prices may have indeed reached an all time high.
If so, it comes at a time when emergency level interest rates are necessary to stimulate an extremely weak Canadian economy.
The Canadian housing market is obviously being given way too much stimulus through CMHC, Genworth, etc..
The only true gauge of the degree of government intervention in the housing market is how much mortgage insurance is being added each year (month) through CMHC, Genworth, etc..
It would be interesting to compare the total mortgage insurance added in the first 6 months of 2013 to other years.
A quick look shows Victoria's population is still growing:
http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/demo05a-eng.htm
info, what metrics are you using to gauge the economy of Victoria?
@Dasmo
2012 data is a little dated.
“We believe that a very draconian scenario would be needed before Canadian banks would experience noticeable losses in their residential mortgage portfolios,” the analysts said. “Loan growth is very likely to decelerate but credit is not a big source of concern given the current state of employment, low debt servicing costs, the full recourse nature of mortgage lending, and two thirds of mortgages being insured.”
An economy running on "low debt servicing costs".
Perhaps this is the new normal. An evolution of capitalism. Maybe saving is really a thing of the past. What if low interest rates are here to stay?
"The analysts at RBC Capital Markets say that while they expect consumer and mortgage lending to decelerate, they don’t see a significant deterioration in the housing market."
That puts my mind at ease. The experts have spoken.
Do you have more up to date than 8 months ago?
"As for the idea that consumers rushed into the market to beat rising mortgage rates, Mr. Soper says consumers have been hearing that rates are going up for too long and are now immune to the chatter. A five-year fixed rate closed mortgage had dipped as low as 2.99% this year but that same product is around 3.59% today."
Phil is right on this one. The masses are in "rates are going to rise" apathy mode. Everyone is convinced that that's not even a possibility. Even if it does, so what? No big deal. Our housing market is immune. Bring on the regulations Flaherty. Do your worst bond market.
THEY MAY TAKE AWAY OUR CREDIT BUT THEY'LL NEVER TAKE AWAY OUR APPRECIATION!!!!
Canada’s housing market: The one that no one can predict
I dunno.... So far I have predicted it right.....flat.
My realtorelative said the only bracket moving right now is 750 to 1.5m. This distortion is giving people the impression of flat. As Alexander mentioned above “Older 1970's type condos in the Victoria area have, for the most part dropped in price by at least 30% in the past 4years.” That price bracket has been guillotined lately.
http://www.canadianmortgagetrends.com/
The blue line on the left hit 2.00 today. If it keeps climbing at the same pace it will hit 3.00 by November. I would think these interest rates are already forcing our governor to move on variable possibly by September? Yes, no?? Interest%ing times. Pun intended.
^Phil
Interesting that on the same day (Aug 9) the TC and BC Stats both publish something about employment in Victoria in July. One says up by 1000, the other says down by 600? Personally I'd give more credibility to BC Stats, just because I have seen how the TC mangles economic reporting
Victoria
Lower than average unemployment for BC.
Higher than average household income for BC.
Capital of the fourth richest (per capita) province in Canada (itself the 10th or 12th richest country in the world).
Yep the economy is TERRIBLE here!
(Yes I know - after the crash i'll be living on Alpo, collecting bottles, and Info will be my landlord)
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I think the news was Victoria lost 600 jobs. It just didn't mention how many it gained.
"With the number of condo sales falling, developers have turned to giving buyers discounts in the form of free furniture or reductions on condo fees, among other things. Thus the official sales prices remain steady, while actual prices come down."
Developers undercutting resellers. All those years of equity building wasted. Already down 15% and we've just barely scratched the surface of the correction.
Toronto Condo Prices Have Likely Fallen Sharply: Developer
1220 Beach sells at $865K. 15% less than assessed value of $1,028M. Oak Bay must be crashing.
Ya....390/sqft for an 80's house on a busy road. Definitely crashing....
Times Colonist had it correct.
Victoria had a net loss of 600 jobs last month and the unemployment rate climbed 0.3%.
The labour force and participation rate remained exactly the same.
http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/lfss03l-eng.htm
Just for comparison, Edmonton had a net gain of 8100 jobs in July, to Victoria net loss of 600.
"Ya....390/sqft for an 80's house on a busy road. Definitely crashing...."
Once again, in an up market, this house would have sold above assessment.
But since Victoria is in a down market, this house sold well below assessment.
Here's one for you, Marko:
A 800 sqft house on a 11,804 sqft rectangular lot, listed for $299,900.
It's on Quadra St, granted, but didn't you say it was impossible to find building lots under $350,000?
(I acknowledge that I may be mis-remembering.)
MLS: 327592
The up market raised assessment values. Mine more than doubled in less than ten years.... So the house probably would have sold for over assessment but not necessarily for over a million.
"The up market raised assessment values. Mine more than doubled in less than ten years.... So the house probably would have sold for over assessment but not necessarily for over a million."
Assessments are done once a year. Thus, the percent above or below assessment of a SFH sale is a very useful indicator of the direction and strength of a housing market in general, or of a particular area within that market, such as Oak Bay.
Victoria is in a down market and the fact that the Oak Bay house sold for 15% below assessment proves that the market in Oak Bay and Greater Vicitoria in general is continuing to weaken.
I bought at 10% under assessment almost two years ago... I also studied assessment to sales for the area via evalueBC. At that time it ranged from about 15% under to 10% over with roughly 60% selling for under. I don't think this a sign of a sudden slide....
It's on Quadra St, granted, but didn't you say it was impossible to find building lots under $350,000?
(I acknowledge that I may be mis-remembering.)
There is a lot right now on Topaz for $275,000 but it is only 2,800 sq/ft. You can easily find lots and single family homes under $350,000 but there is a variety of reasons for that such as being on four lane street.
But find me one on a decent non four lane street in Fernwood/Oaklands/Fairfield with at least 50' off frontage under $350,000. Doesn't show often.
What about these two houses in the 3's with nice size lots over 6000 sq ft i think?
327061
327462
One's in Oak Bay. They might be worth a 300 lowball. No?
"I bought at 10% under assessment almost two years ago... I also studied assessment to sales for the area via evalueBC. At that time it ranged from about 15% under to 10% over with roughly 60% selling for under. I don't think this a sign of a sudden slide...."
Again, the recent sale of an OB house for 15% below assessment is indicative of the current (2013) direction and weakness of the housing market in general.
Again, Houses sell for above and below assessment all the time. I look at that house and see 865K as a whole lot of money. The only thing I can give you is it's not an up market....
"Again, Houses sell for above and below assessment all the time. I look at that house and see 865K as a whole lot of money. The only thing I can give you is it's not an up market.... "
Just Jack used the above/below assessment numbers for SFHs in the core areas and calcuated that there was a 1% price drop month over month from June to July 2013.
The recent OB sale for 15% below assessment supports what Just Jack discovered.
OB house prices have declined almost 10% from peak when considering the 6 month median data.
OB houses are declining in value, some more than others. The recent sale of 15% below assessment was obviously not indicative of all recent OB sales, but it shows that OB houses are definitely declining in value.
It could also be an indication that the decline in value of OB houses has very recently accelerated.
But find me one on a decent non four lane street in Fernwood/Oaklands/Fairfield with at least 50' off frontage under $350,000.
Sorry, you'll have to wait for "the crash" to find that in Fairfield. Don't know the other neighbourhoods as much, so maybe there.
What about these two houses in the 3's with nice size lots over 6000 sq ft i think?
327061
327462
One's in Oak Bay. They might be worth a 300 lowball. No?
327061: Buried oil tank underneath the driveway (risk) plus have to demolish home $$$
327462: Narrow and busy portion of Foul Bay plus have to demolish $$$
Every single day I closely look at new building lots and tear downs and there just aren't any deals out there.
There are just so many other variable the average Joe isn't aware of as they are not in the business of building new homes....for example, if the lot is in the City of Victoria the sewer/storm/water/permit and 50' feet of new sidewalk and curb (all required) will set you back around $25,000. If you buy a lot in a brand new subdivision in Colwood usually everything is already pre-paid for.
Or maybe the BC assessor had a hang over the day he assessed the Oak Bay home for 15% above assessment?
On an individual basis the BC assessment can range wildly. But if you look at 200 assessments in relation to sale prices the assessments on average are resonably accurate.
How accurate do you have to be for tax purposes!? It's when people use the assessment for another purpose - then you have problems. Read through your BC Assessment it doesn't say "market value". It reads "Actual Value". If you want to assume that both are the same - great. But if they were the same - then BC Assessment would use the term market value.
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