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......now thas explains the mystery of the huge explosion we heard in the Puget Sound yesterday...."What happened?? One of the Bangor base nukes went off??".........."no.....the Vancouver real estate bubble finally burst!!!"
Don't get too excited. Two weeks of data really isn't enough to know yet what is happening.
Not surprising since the province introduced the new tax. The only way to see what real effect this will have is too look at homes sales over the next year as people adjust and the market adjusts to the new tax.
"While August is typically one of the slowest months for real estate transactions, MLS sales data from the first two weeks of the month shows what many have been hoping for during the last few years of escalating prices. According to realtor Brent Eilers, using MLS listing data, there were only three home sales in West Vancouver between Aug. 1 and 14 this year, compared to 52 during the same period last year. That’s a decrease of 94%."
"Zolo, a Canadian real estate brokerage, keeps track of MLS home sales in real-time and reports prices as an average rather than the “benchmark price†used by the REBGV. It currently shows a major correction underway in most Metro Vancouver markets. According to the website, the City of Vancouver currently has an average home price of $1.1 million, down 20.7% over the last 28 days and down 24.5% over the last three months."
Here it comes.... Get ready for a bumpy ride Vancouver with double-digit unemployment.
I wouldn't be surprised to see average home prices drop >60% and take decades to return to their previous highs....
$1.5m ($1.15m US) dollars lol, that's higher than the Bay area which itself is in a bubble and Vancouver doesn't have anywhere near the economy job market SF/SJ does.
Here it comes.... Get ready for a bumpy ride Vancouver with double-digit unemployment.
I wouldn't be surprised to see average home prices drop >60% and take decades to return to their previous highs....
$1.5m ($1.15m US) dollars lol, that's higher than the Bay area which itself is in a bubble and Vancouver doesn't have anywhere near the economy job market SF/SJ does.
Thing is Vancouver doesn't need and has never had the kind of economy SF has to support the real estate bubble. That's because the vast majority of buyers of detached million dollar homes and condos are not Vancouver residents (some not even permanent residents of Canada). Therefore their buying power is not dependent on the local economy's well-being: Vancouver can have 30% unemployment one day with low wages and that would still have little effect on the purchasing power of foreign buyers and real estate prices of detached homes in Vancouver proper. I personally know some family friends from China who have recently bought $3-6 million dollar homes in West Vancouver but their annual Notice of Assessment (Canada Revenue Agency) reports less than $50,000 CAD in household income, with some even collecting unemployment insurance. A very common occurrence among the foreign investors community, which I'm sure also occurs in real estate bubbles like SF and Miami under the radar.
If I were you, I wouldn't hold my breath for that "60% drop" in prices (wherever you got that number). Home transactions are down yes, but that has little correlation to the rise or fall of home prices. Most foreign buyers from China that I know in Vancouver are simply waiting on the sidelines to see what kind of effects the provincial government's new tax levy would have on home prices. In the next few months, if they see little price fluctuations and average price of a detached home stays put, the buying frenzy may very well return at an even more dramatic pace.
Just for reference, although sales transactions have declined, the average bench mark prices have actually increased over the past 3 months. Data collected by CBC:
- Benchmark price for a detached property in August in Great Vancouver rose +35.8% from August 2015 to $1.577 million
- On a month by month comparison, it represents a 4.2% increase since May 2016.
- The benchmark prices of condo properties saw a similar surge of 26.9% over August 2015, to an average $514,300, or a 6.1% increase since May 2016.
Keep in mind that the above data covers the entire Greater Vancouver area, including outlying areas such as North Vancouver, Burnaby, Surrey, Maple Ridge. And you can safely assume that within the City of Vancouver, prices have increased at an even faster pace than the above data show.
Last edited by bostonkid123; 09-02-2016 at 11:00 AM..
Here it comes.... Get ready for a bumpy ride Vancouver with double-digit unemployment.
I wouldn't be surprised to see average home prices drop >60% and take decades to return to their previous highs....
$1.5m ($1.15m US) dollars lol, that's higher than the Bay area which itself is in a bubble and Vancouver doesn't have anywhere near the economy job market SF/SJ does.
60% is impossible. A severe drop would finally help us get the upsize we need so I'm not against it as a condo-owner that would suffer much less significant setbacks than a house-owner, but I'm just not seeing it. At least not in certain areas of the GVRD.
Just think of it logically. The market is dictated by two parties, buyers and sellers - for one to get 60% off a housing price (or 50, 40, even 30 is a stretch IMO) a seller must be willing to part with it for that price - and the ridiculous losses it brings to their personal wealth and well being. No one sitting on a $4 million home is going to sell it for $2 million, unless they are absolutely forced to liquidate their investment via a move or some other cash related crisis. They'll just ride that wave back up before cashing out. There are fewer transactions being made because of downward pressure on prices, but I think a lot of it is from sellers just not wanting to sell when the market has clearly cooled.
I will fully admit I know next to nothing about Vancouver as I'm one of those annoying Americans. I've heard its very pretty up there. But anyway, I live in the San Francisco Bay Area. Its certainly not cheap here by any means. We bought a house about a year ago and it too wasn't exactly cheap.
But recently I saw a link to real estate in Vancouver and OMG! A modest house like ours would be two and three times as much in Vancouver! I was blown away by the amount of truly normal looking houses that were often well over a million dollars.
Now- I realize there's a lot I don't know about Vancouver. I think it might be safe to say we probably have better weather than you do, but I've heard for Canada Vancouver is one of the few cities where it doesn't get near as cold as the rest and hence if you're Canadian an want at least decent weather, Vancouver is basically it.
So I'm curious. If I wanted to live in a halfway decent area with say- a 2 to 3 bedroom house, how much are we actually talking here? Is it really a million dollars for a house such as this or was I merely looking at the wrong listings?
Hardly dropping. Benchmark prices for detached homes in Greater Vancouver actually rose by 15%-20% over the past 3 months from 2015 levels. Sales of new homes are down, but prices are continuing their rise.
Hardly dropping. Benchmark prices for detached homes in Greater Vancouver actually rose by 15%-20% over the past 3 months from 2015 levels. Sales of new homes are down, but prices are continuing their rise.
As for condo's, I'm still getting flyers and phone calls from real estate agents wanting to know if I want to sell since they have buyers.
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