Ups and Downs
This Vancouver Residential Average price graph has become a standard reflecting data recorded by the Vancouver Real Estate Board since 1977. As a record of historical real estate prices, it is interesting to review the values of real estate climb over the decades. One problem resulting from the amount of data residing behind the chart, is that it presents in a highly compressed format. As such, it is difficult to see the nuances of the market’s ups and downs. Hoping to alleviate this problem, and with the goal of presenting a visual representation that shows these variants via a scaled down version, below is a representation of a 3 year portion of the data. The assumption is that it will deliver more relevance to those born after 1980 and for those amongst us who I suspect, may require reading assistance.
It bares repeating that Averages are always a little scary. As a snap shot indicator they can prove beneficial, but verification of a trend is only accomplished from a historical viewpoint. The title for such a trend might be ‘Remember When’. One can only surmise that those who use historical averages as an indicator of the future usually have a predilection for being caste into an arena full of hungry lions.
July’s Month of Numbers
The heat was definitely on both in temperature and prices for Detached homes and Apartment units. Both sectors showed an up-tick in pricing with Detached climbing back to $824,437 with a flat line at 0% MOM (month over month) yet staying the YOY average at -8% below 2008’s value.
Apartments rang the bell at $400,823 up from last month’s $383,725, still down MOM (month over month), at -1% and off -7% from 2008’s YOY Average. .
Coming through the door, Attached units stumbled a little, dropping to $486,564 – from June’s price of $489,741 a MOM drop of -2% while continuing to trail at -7% YOY from 2008.
The overall climb in the Vancouver market continues. With the balance of 2009 ahead of us, soggy tea leaves in the cup suggest that it is possible, we might come close to the averages seen in the first quarter of 2008. Although you shouldn’t bet your mortgage payment on this, low mortgage rates drive a hard bargain that is difficult for many buyers to resist. Recently, reports from other markets show a revival of positive reports and combined it may be enough to push our market further than anyone expected in Q4 – 08. One element that may sour this view, is unemployment.
Looking forward, another issue one could speculate upon is that this positive rise in house prices will not last. With the impending arrival of the Harmonized Sales Tax, the cost of acquiring almost any good or service that has the word ‘home’ associated with it, is going to increase your cost.
From the look of things, this brilliant new tax will be pervasive in its extent. Judging by the cover it will affect all things ‘home’. A first view tells us, the new tax will add to your purchase price in ways previously exempt. It will extend from the initial hit on a Realtors service fee to the cost of interior finishing, renovations, contractors labour, appliances, fixtures, light bulbs, door knobs and almost anything else you can think of that is ‘home’ related.
All these will be tax magnets that will in ‘harmony’ take more money from your pocket then ever before. You can presume in advance that the effect will be daunting.
Supported by all Vancouver Realtors, our local real estate board has commissioned Dunwoody Accountants to complete a full analysis of the extent to which the new tax will affect homeowners and potential homeowners. Rest assured, the resulting report of the overall impact will be an eye opener. Do you hear a Cah-ching?
For those of you who are renting, you will not escape the impact. The increased costs to landlords for management, maintenance, repairs, lawn care, electricity and gas will eventually find it’s way to an increased rent cheque.
Usually not an overt cheerleader of the ‘buy now at any cost’ mantra, it would seem that if you are thinking you might buy a home, have done your diligence and crunched the numbers to determine that you can afford to do so, early indications are that doing so now before this tax kicks in on July 1, 2010, will save you a lot of money. My cheer – get going while the going is good and dare it be said – I’m around if you need help.
Vancouver Real Estate Average Price Numbers:
|June 09 – 819,235||June 09 – 489,741||June 09 – 383,725|
|July 09 – 824,437 – Up||July 09 – 486,564 – Down||July 09 – 400,823 – Up|
Vancouver Real Estate Average Price // Monthly Difference Y2Y:
|July 07 – 831,195||July 07 – 487,809||July 07 – 398,710|
|July 08 – 828,780||July 08 – 493,434||July 08 – 389,204|
|July 09 – 824,437||July 09 – 486,564||July 09 – 400,823|
*Disclaimer: Statistics Courtesy REBGV. While believed to be accurate they are not guaranteed.
**Numbers provided may vary as they are dynamically posted by the REBGV.