The Vancouver Market Guessing Game

[rofina]

Hello Everyone.

Lets play a game!

We all love to speculate, pontificate, guess, and sometimes argue.

Its May 22, 2019.

With all the facts we have on hand, status of sales, total listings, trade war, etc, etc. Account for it all as you may.

The questions:

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.

2. Where are we in the cycle? Predict a bottom!

3. The long shot - when will YVR RE mark a new high?

Predict away everyone. Ill post mine when I have more time later on.

[jlousa]

Let's see how close my numbers land.

1) end of may2020 numbers down 7.8% from end of may 2019.
2) market bottom between March and June of next year. If I have to narrow it down I would say Jun 2020 is the last month we see decreases this cycle.
3)No numbers so just a shot in the dark I'm going with early summer 2025 before we reach last year's numbers and push slightly past them.

[WarrenC12]

1) Average down 10% (May 2020)
2) Aug 2021
3) Spring 2026

[WarrenC12]

Originally Posted by WarrenC12

1) Average down 10% (May 2020)
2) Aug 2021
3) Spring 2026

I played the long game and COVID beat me like a rented mule.

What are the actual answers though?

[Changing City]

Originally Posted by WarrenC12

I played the long game and COVID beat me like a rented mule.

What are the actual answers though?

Detached homes, REBGV (so Metro without Surrey)
May 2019 $1,421,900
May 2020 $1,456,700 (1 year +$34,800, +2.4%)
May 2021 $1,800,600 (1 year +$343,900, +23.6%)
(another $49,900 higher in October)

Apartments
May 2019 $664,200
May 2020 $686,500 (1 year +$22,300, +3.4%)
May 2021 $737,100 (1 year +$50,600, +7.4%)
(another $9,300 higher in October)

[misher]

Originally Posted by rofina

Hello Everyone.

Lets play a game!

We all love to speculate, pontificate, guess, and sometimes argue.

Its May 22, 2019.

With all the facts we have on hand, status of sales, total listings, trade war, etc, etc. Account for it all as you may.

The questions:

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.

2. Where are we in the cycle? Predict a bottom!

3. The long shot - when will YVR RE mark a new high?

Predict away everyone. Ill post mine when I have more time later on.

What I see is a pile of fuel that keeps getting bigger waiting for a spark. A lot of people are holding off on buying but will buy as soon as it seems like the market has hit its bottom and will now recover. The ratio of housing units per a person is getting lower not higher. Interest+unemployment rates are still low and the economy is strong.

Long-term predictions point to rapid price increases before 2025. We just don't know when they'll start.

Liberals may modify the stress test pre-election. Conservatives may modify it post election.

I've seen signs that sales have picked up slightly this month but there still so bad so there's no rush to buy yet. However, sales are still happening at a decent pace, we say slowdown but the market is still decently strong.

The FBT summary trial has ended and thats a wild card depending on what the judge says in a few months.

So I'd say late 2019 we should see price gains. But so much depends on policy rather than the market so who knows.

The numbers are there, the demand is there, I feel we've put a dam in thats holding it back and its just building up now. We have huge government cash injections in BC with LNG, the pipeline, and the coast guard plan. There is a crazy amount of money entering our economy and eventually ending up in peoples hands and there going to want to spend that money on something. People only talk about foreign demand but local demand is huge and we're one of the wealthiest nations in the world so people have money.

The below is a great read.

https://chambermaster.blob.core.wind...esentation.pdf

[rofina]

Originally Posted by misher

What I see is a pile of fuel that keeps getting bigger waiting for a spark. A lot of people are holding off on buying but will buy as soon as it seems like the market has hit its bottom and will now recover. The ratio of housing units per a person is getting lower not higher. Interest+unemployment rates are still low and the economy is strong.

Long-term predictions point to rapid price increases before 2025. We just don't know when they'll start.

Liberals may modify the stress test pre-election. Conservatives may modify it post election.

I've seen signs that sales have picked up slightly this month but there still so bad so there's no rush to buy yet. However, sales are still happening at a decent pace, we say slowdown but the market is still decently strong.

The FBT summary trial has ended and thats a wild card depending on what the judge says in a few months.

So I'd say late 2019 we should see price gains. But so much depends on policy rather than the market so who knows.

The numbers are there, the demand is there, I feel we've put a dam in thats holding it back and its just building up now. We have huge government cash injections in BC with LNG, the pipeline, and the coast guard plan. There is a crazy amount of money entering our economy and eventually ending up in peoples hands and there going to want to spend that money on something. People only talk about foreign demand but local demand is huge and we're one of the wealthiest nations in the world so people have money.

The below is a great read.

https://chambermaster.blob.core.wind...esentation.pdf

1,2,3 please.

[misher]

Originally Posted by misher

What I see is a pile of fuel that keeps getting bigger waiting for a spark. A lot of people are holding off on buying but will buy as soon as it seems like the market has hit its bottom and will now recover. The ratio of housing units per a person is getting lower not higher. Interest+unemployment rates are still low and the economy is strong.

Long-term predictions point to rapid price increases before 2025. We just don't know when they'll start.

Liberals may modify the stress test pre-election. Conservatives may modify it post election.

I've seen signs that sales have picked up slightly this month but there still so bad so there's no rush to buy yet. However, sales are still happening at a decent pace, we say slowdown but the market is still decently strong.

The FBT summary trial has ended and thats a wild card depending on what the judge says in a few months.

So I'd say late 2019 we should see price gains. But so much depends on policy rather than the market so who knows.

The numbers are there, the demand is there, I feel we've put a dam in thats holding it back and its just building up now. We have huge government cash injections in BC with LNG, the pipeline, and the coast guard plan. There is a crazy amount of money entering our economy and eventually ending up in peoples hands and there going to want to spend that money on something. People only talk about foreign demand but local demand is huge and we're one of the wealthiest nations in the world so people have money.

The below is a great read.

https://chambermaster.blob.core.wind...esentation.pdf

I made a mistake and didn't answer the questions.

The questions:

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.
-In 12 months I expect the average price to have gone up around 5-10%. Possibly more depending on what happens, there's a lot of factors. Likely stress test will have been modified or removed, China trade war will hopefully be settled and Meng released, and a few other things look good. However, there's a decent change something bad may happen in the world.

2. Where are we in the cycle? Predict a bottom!
-I'd say we're close to the bottom with maybe 3% more to go down in prices.

3. The long shot - when will YVR RE mark a new high?
Highest prices will happen when the FBT is removed and/or the Liberals regain power for a year. Both are likely to happen but it'll be a while. After either happens there will be a steady rise above inflation.

[WarrenC12]

Originally Posted by misher

I made a mistake and didn't answer the questions.

The questions:

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.
-In 12 months I expect the average price to have gone up around 5-10%. Possibly more depending on what happens, there's a lot of factors. Likely stress test will have been modified or removed, China trade war will hopefully be settled and Meng released, and a few other things look good. However, there's a decent change something bad may happen in the world.

2. Where are we in the cycle? Predict a bottom!
-I'd say we're close to the bottom with maybe 3% more to go down in prices.

Oh god these are GOLDEN!

[rofina]

Originally Posted by misher

I made a mistake and didn't answer the questions.

The questions:

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.
-In 12 months I expect the average price to have gone up around 5-10%. Possibly more depending on what happens, there's a lot of factors. Likely stress test will have been modified or removed, China trade war will hopefully be settled and Meng released, and a few other things look good. However, there's a decent change something bad may happen in the world.

2. Where are we in the cycle? Predict a bottom!
-I'd say we're close to the bottom with maybe 3% more to go down in prices.

3. The long shot - when will YVR RE mark a new high?
Highest prices will happen when the FBT is removed and/or the Liberals regain power for a year. Both are likely to happen but it'll be a while. After either happens there will be a steady rise above inflation.

Year to the day everyone. I suppose it would have been smarter of me to start this this thread on the 4th or 5th, so stats can be readily available.

That being said, safe to say that despite a global pandemic Misher is closest to the goal.

I will revisit this in early June when the REBGV stats are out.

[misher]

Originally Posted by rofina

Year to the day everyone. I suppose it would have been smarter of me to start this this thread on the 4th or 5th, so stats can be readily available.

That being said, safe to say that despite a global pandemic Misher is closest to the goal.

I will revisit this in early June when the REBGV stats are out.

Hah thanks. Of course no one predicted the virus outbreak....I would say I look a lot more accurate if we're looking at the market in Feb/Early march.
I was right about the Stress test too, it was about to be modified until they put it on pause due to the virus.

Had hoped Meng would go faster.

Looks like our trade dispute with China is small cheese now, Aussie and USA getting the flak. We may even benefit from it. US trade deal was going to hurt us for their benefit. Had thought that the FBT tax case would do better. Can't predict them all.

[dreambrother808]

Originally Posted by misher

Had hoped Meng would go faster..

I’ve suspected that the Meng issue is all on American terms. They have forced Canada into this position as a proxy in their battle with China. They want to delay the extradition because it makes us take the blowback instead of them. We have agreed to it because they are threatening or offering something in return. Is this how others perceive the issue?

[rofina]

My shot;

1. Prices on average are down 7% from May 2019.
2. We will see lowest prices before spring 2022, winter 21.
3. New nominal high printed Summer 2026

[Changing City]

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.

I'm guessing GVRD detached will be 6.6% lower in May 2020 than in May 2019, so a benchmark of $1.32 million. I think condos will lose more - 10%, so a benchmark of $575,000.

2. Where are we in the cycle? Predict a bottom!

I wouldn't expect to see any recovery before spring 2021, so nearly two more years falling, but less precipitously than in the past few months.

3. The long shot - when will YVR RE mark a new high?

I would expect at least six years before we reach $1.6 million for detached and $700,000 for condo benchmark prices again.

There are a lot of factors that could make those predictions ridiculous - all of them political, (except the earthquake scenario). Those aren't necessarily Canadian politics - what happens south of the border could throw another huge spanner in the Canadian economic works and see property vales take a much steeper turn down.

[whatnext]

Originally Posted by Changing City

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.

I'm guessing GVRD detached will be 6.6% lower in May 2020 than in May 2019, so a benchmark of $1.32 million. I think condos will lose more - 10%, so a benchmark of $575,000.

2. Where are we in the cycle? Predict a bottom!

I wouldn't expect to see any recovery before spring 2021, so nearly two more years falling, but less precipitously than in the past few months.

3. The long shot - when will YVR RE mark a new high?

I would expect at least six years before we reach $1.6 million for detached and $700,000 for condo benchmark prices again.

There are a lot of factors that could make those predictions ridiculous - all of them political, (except the earthquake scenario). Those aren't necessarily Canadian politics - what happens south of the border could throw another huge spanner in the Canadian economic works and see property vales take a much steeper turn down.

I don't even think there will be a marked recovery anytime soon, barring some turn of events that allows a flood of foreign money to return to the market. Instead we will be like Toronto post 1989, where there is a stagnation lasting over a decade, until incomes rise to a point where prices can be justified.

Even if China relaxed rules on capital outflows, there is too much political pressure here now for any sane politician to welcome that money back with open arms.

The city should deal with Boomers whining about their property equity by leveraging it to push for density. IE "You can still get a good price for your SFH if you sell for multifamily development".

[rofina]

Originally Posted by whatnext

I don't even think there will be a marked recovery anytime soon, barring some turn of events that allows a flood of foreign money to return to the market. Instead we will be like Toronto post 1989, where there is a stagnation lasting over a decade, until incomes rise to a point where prices can be justified.

Even if China relaxed rules on capital outflows, there is too much political pressure here now for any sane politician to welcome that money back with open arms.

The city should deal with Boomers whining about their property equity by leveraging it to push for density. IE "You can still get a good price for your SFH if you sell for multifamily development".

1, 2, 3, stake your predictions please.

[Galaxy]

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.

1.4 Million for detached homes and 578,000 for the condo market.

2. Where are we in the cycle? Predict a bottom!

Late 2020 or Early 2021.

3. The long shot - when will YVR RE mark a new high?

4-6 years before recovery to the previous highs.

There is also potential climatic issues where if there are issues with significant migration of people from other places running from droughts and or other issues that could throw a curve ball. I also wonder what will happen as more boomers retire around Canada as I have noticed more of them moving to Vancouver to escape the harsh winters in other parts of Canada.

[Alex Mackinnon]

Originally Posted by Changing City

1. Where do you see the market 12 months from today? Lets focus on price, that's all that anyone cares. Benchmark, average, whatever.

I'm guessing GVRD detached will be 6.6% lower in May 2020 than in May 2019, so a benchmark of $1.32 million. I think condos will lose more - 10%, so a benchmark of $575,000.

2. Where are we in the cycle? Predict a bottom!

I wouldn't expect to see any recovery before spring 2021, so nearly two more years falling, but less precipitously than in the past few months.

3. The long shot - when will YVR RE mark a new high?

I would expect at least six years before we reach $1.6 million for detached and $700,000 for condo benchmark prices again.

There are a lot of factors that could make those predictions ridiculous - all of them political, (except the earthquake scenario). Those aren't necessarily Canadian politics - what happens south of the border could throw another huge spanner in the Canadian economic works and see property vales take a much steeper turn down.

1. Down another 20+ % next year.

2. My guess is that the slowdown will take about 5 years to run it's course. I think we're 1.5 years in. First the market volumes dropped, then the prices have started to fall. Peoples stupid high leverage mortgages will renew at higher rates, and the myth of housing being a great investment will die. People with money will find other productive investments and not dump 100% of their net worth into housing.

3. 30 years+ indexed to incomes/inflation. I think it will take a long time for people to get excited about housing again. Millennials who were keen are going to be underwater and lose their crap. Boomers are going to be shedding RE to fund their retirement because all their net worth is in their house.

All it takes is one big crash for people to get scared for a loooong time.

[GMD]

1. 12 months from today, -9% per GVREB monthly benchmark (e.g. next year same as last year)
2. Bottom: Feb 2022
3. New high - nominal May 2026, real (inflation adjusted) May 2030

But hard to predict since a lot depends on policy. If the central bank drops rates to 0, that will revive the market, most likely. Rate increases could really crush Vancouver. The above is based on no change in the overnight rate from BofC

[misher]

Honestly the market is bigger than the residential market. You’d think you’d see a fall in the commercial market with residential going down and sales have slowed but prices still seem to be stable. That kind of speaks to how strong our economy is.

There’s also large 6.7% gains in the American commercial market over the last 12 months which implies ours should be going up as well https://www.creherald.com/u-s-commer...medium=ios_app