Dazed and Confused
Posted March 17th, 2010 in Neighbourhood SnapShot, Vancouver East Side | 
I Feel the Earth Move
The Vancouver East Attached market looks much the same as the Fairview and Kitsilano neighbourhoods. While not a landslide, it is quite certain the market is on the move.
Attached Listings
In the two periods viewed January/February and February/March, Total listings dropped from 777 to 664.
Solds
During these same periods Jan/Feb recorded 188 Sold but, dropped in Feb/Mar by more than 42% to 80 units.
Expired Mandates remained relatively steady showing a slight improvement with 19 in Feb/Mar compared to 24 in Jan/Feb.
Adjustments
Price adjustments showed reductions slowing a little in Feb/Mar dropping from Jan/Feb’s 137.
Price increases grew slowly from Jan/Feb’s 20 to Feb/Mar’s 24.
Prices
Both Average and Median ASK and Sold prices dropped. The change did not reach “sky is falling” levels. However, it is somewhat foretelling of a possible future market in Vancouver’s Attached sector.
Average ASK dropped from $421,090 in Jan/Feb to Feb/Mar’s $390,912. Average SOLD accordingly dropped from Jan/Feb’s $416,433 to Feb/Mar’s $386,048.
Median ASK paralleled the average number with Jan/Feb’s $389,000 figure dropping to Feb/Mar’s median ASK price of $359,900 .
Median Solds exhibited a similar pattern from $382,500 in Jan/Feb to Feb/Mar’s median Sold of $356,250.
Thoughts
Eerily similar is the appearance of the East side number pattern to those seen in the Fairview and Kitsilano attached pattern. All have dropped with the same restrained gusto.
Having read March’s RBC Report amongst others, the future expectations are that until all the mortgage rules are operational, until employment numbers come crashing down, until all the taxes are in full play and until the Bank of Canada actually fulfills it’s mumblings of raising the prime rate, it would not be an unreasonable view to suggest that all bets are off for the next few months. Simply, there are just to many balls in the air at this time. As such, how these balls will impact the Vancouver attached market will be determined in the near future.
One certainty is that compared to months not long ago, the lay of the land has changed. While some Buyers are prepared to enter the fray of multiples the Average and Median sold prices imply that overall, they are being much more prudent in their negotiations.
Suspect is that the current market path is a reflection of prevailing uncertainty of the impact previously noted. While there are those amongst us who will perform exotic calculation scenarios in advance and have something to say about the portent of doom and gloom – expertly justified of course, the market cup on my table remains half full.
Like it or leave it this needs to be said: if you have some money that isn’t burning a hole in your pocket,if you are prepared to walk away from expectations of over zealous sellers coached by inexperienced agents, if your expectations of what your money will buy is reasoned, meaning that no, you will not find your parent’s fully finished home for half of what they paid, if you accept all this as realistic, then the potential to get yourself a good home at a fair price exists in this market.
I guess current buyers are riding the market down just as they rode it up.
“Rolly coasta!”
(Disco Tex and the Sexolettes)
Hi Larry, with regards to the new mortgage rules coming in effect; if a current home owner needs to relocate and buys a second home that will become the primary residence while his original home is being rented, does the 20% downpayemt rule still apply?
Also, I am curious to know from a previous post how you calculated the mortgage helper component into the new rule. Where does the 35% of the 50% rental income come from?
thanks
Great chart/analysis/thoughts LarryBear.
Hmm, I am suprised, given the general rise in listings, that this market is seeing a reasonably sharp decline (countertrend) in listings. But the drop in sales is much more pronounced.
Well, you said it, the next few months bear watching, but until the new mortage rules, HST and higher rates are in place, all bets are off (to a degree).
Larry. If buyer John Doe gets a pre-approved mortgage under the old rules on, let’s say, April 13th, does he have 90 days to use these funds, or if he does not buy by the 19th, will his mortgage funding adjust to a lower level of buying power (I would imagine) to the new rules? This seems ambiguous.
I suspect they will allow pre approved deals to remain intact for a certian period – but does anyone have clarity on this?
Larry,
Are we going to see the first price declines when the March stats come out in a couple of weeks?
It’s been 12 consecutive months of increases to date.
#1
The way I understand it, the new rules apply when you try to get the chmc insurance, and that is at time of buying. So your preaproval may not work out anymore..
Dr. Know
Yes, stats tonight are quite bullish (I guess that would be your interpretation), us bears hope for more of the same.
See, we can both be happy.
Dumb is as dumb does.
Hi Boombust,
I agree, I think this month will print lower prices.
I think that will be the theme from here for the next several years (not every month, but the bulk of them, until prices drop around 40-50%).
Just our opinions.
Larry, we too know what we are looking for (in broad terms). Once things start to slide, I’ll let you know what they are so you can be on the lookout for us.
Charles.
By the way, great graph Larry.
This is the best site for tracking Vancouver (and other areas covered) unfolding real estate drama.
We have our popcorn, Tammy’s settled in and we will be watching the show unfold as we go forward. We have great seats, and this site is the screen on which the show will be projected – many thanks from all of us for that Larry.
Dr. Know:
You may find it of interest that listings have now breached the 14,000 mark. That is not a tight market, and the listings relative to sales (ie. the MOI bantered about) is “surging”.
Be safe out there.