The Metro Vancouver Real Estate Thread

[rofina]

Lets be objective here - I think we can all agree prices are trending down. Its not apocalyptic out there, but there isn't much pressure on prices to move up.

I don't see why there would be any upward price pressure going forward, borrowing costs are up, trade wars abound, plenty new completions coming soon.

Like I mentioned above, I don't think were headed for US 2008 - but I do think we have a few years of stagnation ahead.

This also doesn't mean that I don't think that in 10 years things wont be significantly more expensive - its like that old saying best time to buy RE was 10 years ago, second best time is today.
Probably not far from the truth, but everyone is always scared to catch a falling knife, more confidence to get into a bidding war than pay under ask.

Such is the investing world.

[misher]

Originally Posted by WarrenC12

Condo prices are going down. This is the beginning of the end.

You'd make a great violin player on the Titanic.

Your conclusions are not supported by most recent data. Sales are actually picking back up. This was predicted as coming as they've already picked back up across the country after being down from the mortgage increases. There was a downward trend occurring until this month. Honestly the average condo didn't go down much if at all over the past year it was mostly detached and luxury. Infact condos appear to have gone up overall over the past 12 months.

Signs of a market recovery? Home sales improve slightly in October
After a gloomy September, Metro Vancouver’s real estate activity brightens somewhat

September may have been dismal for real estate sales, but October showed a slight improvement, the latest statistics from the Real Estate Board of Greater Vancouver reveal.

There were 1,966 home sales in October 2018, according to board stats released November 2. That’s a considerable 23.3 per cent increase compared with September's 1,595 residential sales.

https://www.vancourier.com/real-estate/s...s-improve-slightly-in-october-1.23485200

[whatnext]

Originally Posted by misher

Your conclusions are not supported by most recent data. Sales are actually picking back up. This was predicted as coming as they've already picked back up across the country after being down from the mortgage increases. There was a downward trend occurring until this month. Honestly the average condo didn't go down much if at all over the past year it was mostly detached and luxury. Infact condos appear to have gone up overall over the past 12 months.



https://www.vancourier.com/real-estate/s...s-improve-slightly-in-october-1.23485200

You are buying into the spin from the REBGV. Sales are picking up compared to what? September? October sales almost always pick up from the previous month. Go back and look at the data.

The Real Estate Board's job is to polish turds. Collapsing markets are "a great buying opportunity" with "more choice for buyers".

[WarrenC12]

Originally Posted by misher

Your conclusions are not supported by most recent data. Sales are actually picking back up. This was predicted as coming as they've already picked back up across the country after being down from the mortgage increases. There was a downward trend occurring until this month. Honestly the average condo didn't go down much if at all over the past year it was mostly detached and luxury. Infact condos appear to have gone up overall over the past 12 months.

The most recent increase from the BOC took place last week and is just hitting variable mortgages for their next payment.

Stop drinking the koolaid.

[misher]

Originally Posted by whatnext

You are buying into the spin from the REBGV. Sales are picking up compared to what? September? October sales almost always pick up from the previous month. Go back and look at the data.

The Real Estate Board's job is to polish turds. Collapsing markets are "a great buying opportunity" with "more choice for buyers".

Let me ask you, who runs the real estate council? who runs the real estate board? The real estate board has been publishing a ton of reports saying the markets going down and suddenly they are bad because they publish one that says its going back up?

And they definitely used the right words there. Sales have gone down and inventory has gone up which means there is definitely more choice for buyers. With sales down buyers have better opportunities to negotiate and more choices to choose what they want.

[CanSpice]

Originally Posted by misher

Your conclusions are not supported by most recent data. Sales are actually picking back up. This was predicted as coming as they've already picked back up across the country after being down from the mortgage increases. There was a downward trend occurring until this month. Honestly the average condo didn't go down much if at all over the past year it was mostly detached and luxury. Infact condos appear to have gone up overall over the past 12 months.



https://www.vancourier.com/real-estate/s...s-improve-slightly-in-october-1.23485200

The rebuttal to what you said is in the link you provided. Like whatnext said, sales always go up in October vs September, just look at the first graph in that story.

And when you say "In fact condos appear to have gone up overall over the past 12 months" if you're talking about sales (which you have been) then sure, if by "up overall over the past 12 months" you mean "a total of 985 Metro Vancouver condos traded in October 2018, a decline of 35.7 per cent decrease compared to the 1,532 sales in October 2017" then yeah, I guess that's going up over the past 12 months, sure.

Do you even read the links you post here?

[Abii]

Here's an anecdotal support for the camp that says prices are going down: I sold my condo in the summer, because I wanted to go back to school and wasn't in the mood for student loans (in other words I wasn't trying to time the markets, I needed the money). I sold my unit for 650k and the list price was 15-20k higher (don't remember the exact number). At the time I was competing with the unit right below me, which was completely renovated (same exact plan/views, but mine didn't have any renovations). That unit was listed for a higher price, but I though it was justified because of the renovations.

Long story short, I just checked, and most 1 bedrooms in my old building are now listed for 550-590k, with the exception being the above-mentioned unit, which remains unsold, and is now listed for exactly 650k, the price I sold my unit for back in the summer! The two-bedroom listings also seem lower, but I can't say for sure.

I also have a realtor friend that says I got really lucky for selling when I did.

[whatnext]

Originally Posted by Abii

Here's an anecdotal support for the camp that says prices are going down: I sold my condo in the summer, because I wanted to go back to school and wasn't in the mood for student loans (in other words I wasn't trying to time the markets, I needed the money). I sold my unit for 650k and the list price was 15-20k higher (don't remember the exact number). At the time I was competing with the unit right below me, which was completely renovated (same exact plan/views, but mine didn't have any renovations). That unit was listed for a higher price, but I though it was justified because of the renovations.

Long story short, I just checked, and most 1 bedrooms in my old building are now listed for 550-590k, with the exception being the above-mentioned unit, which remains unsold, and is now listed for exactly 650k, the price I sold my unit for back in the summer! The two-bedroom listings also seem lower, but I can't say for sure.

I also have a realtor friend that says I got really lucky for selling when I did.

Yep, anybody buying now is basically trying to catch a falling knife.

[misher]

Originally Posted by CanSpice

The rebuttal to what you said is in the link you provided. Like whatnext said, sales always go up in October vs September, just look at the first graph in that story.

And when you say "In fact condos appear to have gone up overall over the past 12 months" if you're talking about sales (which you have been) then sure, if by "up overall over the past 12 months" you mean "a total of 985 Metro Vancouver condos traded in October 2018, a decline of 35.7 per cent decrease compared to the 1,532 sales in October 2017" then yeah, I guess that's going up over the past 12 months, sure.

Do you even read the links you post here?

Do you? Factoring in the October rise from last year there still up quite a bit.

[Alex Mackinnon]

I see a lot of conjecture and not a lot of hard numbers and facts in this thread.

I've been watching the stats that Zolo puts out for the last year or so. My overall impression is that the market has been freezing up and prices are stubbornly waiting for a side to blink. The pressure for the for a price collapse has been doing nothing but growing. Canadians are leveraged to high hell, and the mortgage rates are likely to do nothing but climb for the next year or two.

Anyway, enough of my opinions or industry dogma. Have a look at the stats:

Vancouver

Surrey

Burnaby

If it asks for an account just make up an email address.

The inventory to sales ratios indicate that all these markets have around a years inventory now. Who wants to hold onto a house for a year?

It's a buyers market, but the buyers now realize the cheap money is gone.

[misher]

Originally Posted by Alex Mackinnon

I see a lot of conjecture and not a lot of hard numbers and facts in this thread.

I've been watching the stats that Zolo puts out for the last year or so. My overall impression is that the market has been freezing up and prices are stubbornly waiting for a side to blink. The pressure for the for a price collapse has been doing nothing but growing. Canadians are leveraged to high hell, and the mortgage rates are likely to do nothing but climb for the next year or two.

Anyway, enough of my opinions or industry dogma. Have a look at the stats:

Vancouver

Surrey

Burnaby

If it asks for an account just make up an email address.

The inventory to sales ratios indicate that all these markets have around a years inventory now. Who wants to hold onto a house for a year?

It's a buyers market, but the buyers now realize the cheap money is gone.

Way to explain it!! But I will point out that out amount of inventory is high compared to last year but overall it’s not much different than inventory in other cities our size. We’re just becoming an average market rather than being crazy. I think a huge price decrease is a risk but it’s a low risk. Much more likely buyers are taking a pause or going elsewhere for now.

[whatnext]

Originally Posted by misher

Do you? Factoring in the October rise from last year there still up quite a bit.

Nope.

[rofina]

Originally Posted by whatnext

Yep, anybody buying now is basically trying to catch a falling knife.

There is always a reason to not buy.

I totally agree the numbers are stacked in favour of prices to continue down.

But Its humorous what when prices are up 18% YoY pundits come out and say not to buy, its too hot. And then the following year they're up 12%. Still to hot though.

Now prices are down, maybe 5, 10, 15%, pundits come out and say don't buy, its like catching a falling knife.

I understand the desire for a getting the best possible price, but whats the answer here? Wait for the 50% collapse like some have been since 2006?

And again - not saying prices aren't trending down, they clearly are, and I think odds are in favour they will continue to do so for a couple years.

Even with that fact - you buy today, under asking, something you can afford to hold for 10 years. I cant believe that on a 10 year time frame it doesn't turn into a win.

EDIT: From personal experience, I "caught a falling knife" in 2009 with my first condo. 2 years of lower assessments left me in the red because of my tiny down payment at the time.
Now 9, almost 10 years on its doubled in price. So overall it turned out quite alright.

Crystal balls are tricky to read, but Vancouver has a pretty phenomenal decade over decade record.

[whatnext]

Originally Posted by rofina

There is always a reason to not buy.

I totally agree the numbers are stacked in favour of prices to continue down.

But Its humorous what when prices are up 18% YoY pundits come out and say not to buy, its too hot. And then the following year they're up 12%. Still to hot though.

Now prices are down, maybe 5, 10, 15%, pundits come out and say don't buy, its like catching a falling knife.

I understand the desire for a getting the best possible price, but whats the answer here? Wait for the 50% collapse like some have been since 2006?

And again - not saying prices aren't trending down, they clearly are, and I think odds are in favour they will continue to do so for a couple years.

Even with that fact - you buy today, under asking, something you can afford to hold for 10 years. I cant believe that on a 10 year time frame it doesn't turn into a win.

EDIT: From personal experience, I "caught a falling knife" in 2009 with my first condo. 2 years of lower assessments left me in the red because of my tiny down payment at the time.
Now 9, almost 10 years on its doubled in price. So overall it turned out quite alright.

Crystal balls are tricky to read, but Vancouver has a pretty phenomenal decade over decade record.

Except 2009 was the beginning of exceptionally low credit and in the middle of Chinese capital outflows. Both are unlikely to be repeated in the foreseeable future. I worry we have a lot of youngsters like misher who think the state of the market 2009-2017 was "normal".


Vancouver’s condo market continued its downwards trend in the month of October. This should generally come as no surprise considering Real Estate markets are incredibly slow moving and are highly dependant on the availability of mortgage credit. In other words, this trend is likely to remain in place for the foreseeable future unless we see a shift in either domestic credit, (mortgage credit growth is currently at its weakest pace of growth in 18 years), or we see large capital outflows from China. This seems unlikely given their need to maintain capital reserves in order to fight a trade war and growing economic instability and slowing real estate market...

...As is typical in all real estate markets, sales volumes lead prices. This is generally a result of market exhaustion and an adjustment phase were both sellers and buyers hold out, with sellers trying to maintain current prices and buyers holding out anticipating future price declines. Sales volumes in Vancouver’s condo market ultimately peaked out in the spring of 2016, it is only now where are seeing some movement on prices.

The average sold price per square foot peaked in January at $1124/sq ft and has now dipped to $1016. While there is no perfect measure to gauge price movements, both the average and median sales price are also showing declines from their peaks earlier this year....

https://vancitycondoguide.com/vancouver-condo-sales-drop-october-2012/

[whatnext]

BC's pre-sale condo registry aimed at speculators was launched yesterday:

..The province said that, effective January 1, 2019, developers who sell strata units must:

• include terms and a notice in their contracts to inform buyers of the new collection and reporting requirements;

• collect information, including the terms of the assignment and the name and social insurance number or business information of the parties to the assignment; and

• report this information in the online register.

The announcement added, “The B.C. government will provide this information to the Canada Revenue Agency so that transactions can be traced back to the assigner’s income tax return. This will ensure that people who assign condos are paying the appropriate income taxes.”

https://www.vancourier.com/real-estate/b...mised-condo-flipping-registry-1.23487792

[Changing City]

CMHC have published their Outlook for the next two years for Canada, and regions. Here's some of what they said about Greater Vancouver:

"Over the next two years, the resale home markets of the Vancouver and Abbotsford-Mission Census Metropolitan Areas (CMAs) will be characterized by lower sales, higher inventories of homes for sale, and lower home prices compared with recent market highs. This shift in conditions marks the end of the “two speed” market conditions that had prevailed in the region since mid-2016, whereby lower-priced properties experienced higher demand and price growth compared with higher-priced properties. As 2018 has progressed, demand and home prices have now softened across all market segments and local geographies.

Slowing population and employment growth and rising mortgage rates have impacted demand for some properties in the Vancouver CMA. This reality, when combined with housing policy changes from all levels of government, has resulted in an evolution of short- to medium-term home price expectations compared with where they were one to two years ago. Changes in these expectations, in line with market conditions, will have a particular impact on the higher end segment of the market, where property prices are largely equity-driven.

While existing home sales are expected to rebound in 2019 from the trough in 2018 in order to be more in line with the region’s growing population, resales will remain below the levels seen in 2015-2017. Newly constructed homes coming onto the resale market will also lend some support to sales through the end of the forecast horizon With resale market home prices moving lower and a record number of new units currently under construction across the region, housing starts are expected to decline in the Vancouver CMA over the next two years. Completions of new units are expected to continue running ahead of household formation into 2019, necessitating a pullback in new construction as projected inventories of unsold units rise.

New condominium apartment developments may face longer sales periods over the forecast horizon as consumers have more options in a rising inventory environment. From a tenure perspective, new rental projects are expected to comprise a greater share of the construction mix due to tight rental market conditions and a more favourable development environment in many municipalities in the region.

With the record pace of units under construction, the availability and costs4 of materials and labour in the region could restrain the viability of some new developments. Given that there are a number of large infrastructure projects planned for the region, these constraints are expected to remain in the medium term even with lower residential construction."

[whatnext]

Originally Posted by Changing City

CMHC have published their Outlook for the next two years for Canada, and regions. Here's some of what they said about Greater Vancouver:

"Over the next two years, the resale home markets of the Vancouver and Abbotsford-Mission Census Metropolitan Areas (CMAs) will be characterized by lower sales, higher inventories of homes for sale, and lower home prices compared with recent market highs. This shift in conditions marks the end of the “two speed” market conditions that had prevailed in the region since mid-2016, whereby lower-priced properties experienced higher demand and price growth compared with higher-priced properties. As 2018 has progressed, demand and home prices have now softened across all market segments and local geographies.

Slowing population and employment growth and rising mortgage rates have impacted demand for some properties in the Vancouver CMA. This reality, when combined with housing policy changes from all levels of government, has resulted in an evolution of short- to medium-term home price expectations compared with where they were one to two years ago. Changes in these expectations, in line with market conditions, will have a particular impact on the higher end segment of the market, where property prices are largely equity-driven.

While existing home sales are expected to rebound in 2019 from the trough in 2018 in order to be more in line with the region’s growing population, resales will remain below the levels seen in 2015-2017. Newly constructed homes coming onto the resale market will also lend some support to sales through the end of the forecast horizon With resale market home prices moving lower and a record number of new units currently under construction across the region, housing starts are expected to decline in the Vancouver CMA over the next two years. Completions of new units are expected to continue running ahead of household formation into 2019, necessitating a pullback in new construction as projected inventories of unsold units rise.

New condominium apartment developments may face longer sales periods over the forecast horizon as consumers have more options in a rising inventory environment. From a tenure perspective, new rental projects are expected to comprise a greater share of the construction mix due to tight rental market conditions and a more favourable development environment in many municipalities in the region.

With the record pace of units under construction, the availability and costs4 of materials and labour in the region could restrain the viability of some new developments. Given that there are a number of large infrastructure projects planned for the region, these constraints are expected to remain in the medium term even with lower residential construction."

I found this sentence interesting, as it tends to contradict all those saying the problem is not enough supply:

Completions of new units are expected to continue running ahead of household formation into 2019, necessitating a pullback in new construction as projected inventories of unsold units rise.

[retro_orange]

Funny thing, people will stop moving here if they can't make a living. Which in turn kills population growth and growth in the economy.

[rofina]

Originally Posted by whatnext

Except 2009 was the beginning of exceptionally low credit and in the middle of Chinese capital outflows. Both are unlikely to be repeated in the foreseeable future. I worry we have a lot of youngsters like misher who think the state of the market 2009-2017 was "normal".


Vancouver’s condo market continued its downwards trend in the month of October. This should generally come as no surprise considering Real Estate markets are incredibly slow moving and are highly dependant on the availability of mortgage credit. In other words, this trend is likely to remain in place for the foreseeable future unless we see a shift in either domestic credit, (mortgage credit growth is currently at its weakest pace of growth in 18 years), or we see large capital outflows from China. This seems unlikely given their need to maintain capital reserves in order to fight a trade war and growing economic instability and slowing real estate market...

...As is typical in all real estate markets, sales volumes lead prices. This is generally a result of market exhaustion and an adjustment phase were both sellers and buyers hold out, with sellers trying to maintain current prices and buyers holding out anticipating future price declines. Sales volumes in Vancouver’s condo market ultimately peaked out in the spring of 2016, it is only now where are seeing some movement on prices.

The average sold price per square foot peaked in January at $1124/sq ft and has now dipped to $1016. While there is no perfect measure to gauge price movements, both the average and median sales price are also showing declines from their peaks earlier this year....

https://vancitycondoguide.com/vancouver-condo-sales-drop-october-2012/

You're correct - but this is also using the benefit of hindsight.

At the time literally all the Vancouver bears were screaming "you're catching a falling knife! This will be worse than Miami, Vegas, and Phoenix put together!"

Few predicted rates dropping, few predicted the epic real estate run that followed.

The reality today is that an inordinate amount of global wealth is tied to RE values. They can absolutely go down, but not to the point that it exacts pain on the real money out there. Private wealth, pension funds, hedge funds, etc.

I think RE is going to be slow moving for a couple years, on average headed down. But there will be another up cycle.

And as I say. If anyone is holding off buying, completely understand.

But if you can be comfortable, today pay less than 6, 12 months ago, and have a place to call your own for 7-10 years. You'll do just fine financially.

[rofina]

Originally Posted by retro_orange

Funny thing, people will stop moving here if they can't make a living. Which in turn kills population growth and growth in the economy.

Except job creation in non RE sectors will continue to be exceptionally strong over the foreseeable future. Film, finance, tech, bio tech, resource, all growing strong. Construction will slow down, but there is big infrastructure spend coming down the line, as well as LNG. I think on a whole the province and region will do well over next couple of years.

A RE correction is bullish for the City - if it ever gets close to anything resembling affordable there is no chance that people don't choose to relocate here.