Vancouver Digs
Posted November 15th, 2009 in Real Estate, Statistics | 
Where did we come from?
Paleontologists constantly search for the definitive Rosetta stone that will unlock the secret to our origins. How we got to where we are is the essence of their research.
There is no Rossetta stone that gives us a clue to the origins of the Vancouver’s market. Archaeologists on the other hand, come to understand the culture of peoples as they interpret their artifacts. Understanding the Vancouver West Side real estate market is more the study of the market artifacts. Assuming the role of an real estate archeologist, we have only to dig into historic statistics to give us a sense of this market’s culture.
One
This first picture graph of Unit Listed, Sold, and Active Listing history is a record of Vancouver’s West Side market’s activity for detached homes. A one year slice of the historical market shows Active listings inventory on a continual slide downward since this time last year. Units listed continually increased but the volume of sales grew to outstrip that growth while concurrently drawing down inventory levels.
Two
The second graph entitled Dollar Volume, shows us the dramatic price recovery the market experienced for a two year period from Oct 2007. November 2008 reflects the lowest period of sales.
Three
This third graph is a record of the Average and Median prices. The lowest ebb in both Average and Median occurred in January of 09 thereafter matching the climbing market frenzy. The announcement of low interest rates occurred in March of 09 and appears to have acted as the greatest single influence in stimulating the market. Records show that Average and Median price have now recovered to the highs of 07 and 08.
Digging the Future
Viewing the results from these historic digs Cameron Muir Chief Economist for the BCREA may be correct in declaring that a future dig in 2010 may show price increases of 4%. Problematic is that his analysis may have missed indicators that suggest a continued declining listing inventory. Should that prove true, his forecast of a 4% price increase may be low. With conjecture Mr. Muir notes that ‘affordability constraints will limit home price inflation”. Further, his assumption may not be right as indications are that a cultural shift is afoot. We might call it the ‘low interest rate culture’ – believed to have evolved in this latest period. It is defined by buyer’s lacking ‘prudence perspective’. Uncertain is whether Muir accounted for this cultural phenomena – one that may lead to a number higher than 4%.
Archeology is a strange science where understanding changes as each shovel of antiquity is unearthed from the dig. This market’s statistical history is changing daily. Only a look back in time will reveal the true nature of today’s culture. Wait we must to dig again in 2010.
*Disclaimer: Statistics Courtesy REBGV. While believed to be accurate they are not guaranteed.
