Vancouver Home Buyers in a Mexican Stand Off

Mexican Stand Off

Buying or Selling Vancouver real estate has become a Mexican Standoff.

Formula

It was inevitable for Vancouver’s real estate market to reach this evolutionary point. How could it not? The mix of a ‘last gasp – vote securing’ 15% foreign national tax on property purchases, banks with lending practices that favored individuals with “Welcome to Canada” mortgages, a select group of nefarious Realtors – yes they exist, who conveniently forgot who they were working for and a middle class (what’s left of it) screaming at the unfairness of a unlevel playing field. All have combined to leave September’s market in a stand off where sellers are holding on to high asking prices and buyers are keeping their money in their pockets.

Average Price 1977 – 2016

2016-10-01-average-priceYattermatters – Average Price September 2016

Vancouver Real Estate Average Numbers

Detached Attached Apartment
Sept 16 – $1,532,242
8%
Sept 16 – $741,985
+15%
Sept 16 – $549,214
+14%
Sept 15 – $1,408,722 Sept 15 – $640,395 Sept 15 – $479,168

Vancouver Real Estate Inventory – Active Listings

Detached Attached Apartment
Sept 16 – 5,432
+18%
Sept 16 – 1,175
-17%
Sept 16 – 2,747
-42%
Sept 15 – 4,577 Sept 15 – 1,431 Sept 15 – 4,797

Vancouver Real Estate – Units Sold

Detached Attached Apartment
Sept 16 – 672
-47%
Sept 16 – 370
-31%
Sept 16 – 1,219
-20%
Sept 15 – 1,286 Sept 15 – 544 Sept 15 – 1,529

*Percentage = YOY

Stalemate

Vancouver’s home buyers and sellers are testing each other in this standoff. The standoff puffery is seen in the still high prices and low sales volume. In a short time this will be recognized in its true form – a stalemate. In this game of push and shove with buyers and sellers competing the buyers will be checked. The check will be forced not by governments or banks, but by geography.

standoff-money-450x299

Ever increasing prices are inevitable. Those who choose to live in this city have little choice. The concept of affordable housing are “moonbeam” dreams that are forever disturbed by Vancouver’s limited geography which continues to force the abandonment of Vancouver’s parochial dream of being a reasonably priced city in which to live.

Expo 86 and the Winter 2010 Olympics were the city’s great selling opportunity of the century. It worked! Back then business leaders, city and provincial fathers wanted this place to grow up and it has. However, it seems their visions did not take into account what growing up would mean to future generations seeking to buy a home in Vancouver.

The result of that masterful selling job is that more and more people want to live in Vancouver and they are welcome but, they should clearly understand the disclaimer on the entrance ticket. Buying or renting a home in this city commands a high price. Further, as each new ticket sells the price of the next increases. Retrospectively, today’s prices may be a bargain.

About Larry Yatkowsky

Larry is a recognized real estate expert. A veteran professional, his experienced counsel leads Vancouverites in his west side community to place their trust in a man passionate about his work. Uncompromising ethics bring a balanced approach to realizing your real estate dreams.

When Life Moves You - contact Larry:

*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.

Reader Comments:

yvr2zrh Says:
October 1st, 2016 at 11:42 am

When you say that so many people want to live in Vancouver – you have to remember that the city is now essentially “closed” to outsiders. You have to either be:
a.) Canadian
b.) Moving to Vancouver for a job with permanent residence.

Otherwise – you are not going to buy anything.

Vancouver is not the only place in the world that is nice to live. I can confirm this – since I don’t live there anymore and I have no desire to ever return.

Also – with the empty home tax and the killing of the investor-led short-term rental market, this market is destined to return to some type of fundamentals – -.

There is a bit of a buyer stalemate for sure – However – it’s not that buyers are sitting waiting for prices to fall so they can reap the benefits of the lower price – they are waiting for it to fall because they can not pay the current price at all.

Thank you for posting the stats – you are the most reliable and the most accurate – on the first day of the month.

Kitty Says:
October 1st, 2016 at 3:52 pm

Dead Cat Bounce

Bbcoq Says:
October 2nd, 2016 at 8:39 pm

With less outside money ages will still need to grow for locals to afford places here. Are people willing to pay higher taxes and prices on goods to support higher wages? I don’t think so.
That means lower real estate prices reflecting local wages.

Fortune500 Says:
October 4th, 2016 at 10:30 pm

How do you think the Federal government’s recent mortgage changes are likely to influence the ‘entrance ticket’?

http://www.theglobeandmail.com/globe-investor/investment-ideas/canada-housing-stocks-fall-as-government-tightens-mortgage-rules/article32235045/

October 6th, 2016 at 3:50 pm

@Fortune,
strange – you ask a question and then provide a possible answer.

Dave Says:
October 8th, 2016 at 8:16 am

Larry, what’s the word on the street about the new mortgage rules?

As much as I would like to see prices go back to 2013/14 levels….. yes, I would be happy with that.

It is still supply and demand, and with in migration to lower mainland still high, and rentals near impossible, I think small correction is all we will see.
Thanks….Dave

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