Vancouver

Vancouver Real Estate Declines On Almost Every Measure In November

Vancouver real estate felt further pressure in November, with the composite average of homes falling $11,000 from October.

Vancouver Real Estate Declines On Almost Every Measure In November

Vancouver real estate definitely isn’t ending 2016 the way it started. The latest report from the Real Estate Board of Greater Vancouver (REBGV) didn’t even try to sugar coat it. The newest stats from REBGV show lower prices, lower sales, and a significantly lower absorption rate from last year.

Prices Are Dropping

The benchmark average price across the Greater Vancouver Region (GVR) remained high, but is starting to show declining interest. The average composite dropped 1.2% from last month to $908,300. The $11,000 decline is somewhat softened by the fact that prices are still 20.5% higher than last year. Homes are still expensive, but speculators appear to be letting them go for less.

Sales Are Declining

Sales in the GVR declined across the board, and there’s no other way to read that. November saw 2,214 sales – a 0.9% decrease from the month prior. As large of a drop as that is, it’s a 37.2% decrease from the same time last year. It’s unclear how much of declining sales are attributed to environmental market changes, or if buyers are experiencing price exhaustion. Either way, buyers appear to be taking a wait and see approach.

Absorption Is Higher Than Last Year

Absorption of new listings had a minor uptick, but still remains much lower than it was at this time last year. The absorption rate climbed 2 percentage points from October to 26.4%. Anything above 20% is considered a seller’s market, and generally prices should increase. However, it is a 39% decrease from the same time last year – so it probably feels like the sky is falling to the real estate industry. The lower the absorption rate, the higher the inventory build.

Since Vancouver real estate hasn’t been driven by fundamentals, minor changes in indicators might provide major swings in opinion. This report comes just a few days after BCREA released their projection for a significant decline for home values in the GVR. We’ll break down the different segments of the market in separate reports. Like us on Facebook to be notified when the next report is released.

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6 Comments

  • Reply
    RE Bear 9 months ago

    Still overpriced. It’ll need to come down another 30-50% for locals to ever compete with it again.

    • Reply
      Chris 9 months ago

      It will have to be at least 50% from current price.

    • Reply
      Trash Panda 8 months ago

      Lol. Sure if you define overpriced as in comfortable affordability with low debt required to purchase a home. But the question is would houses come down 30-50%, just because you hope it is?

      Economically the houses are priced at where it should be worth with low interest rates.

      Think about it this way too. Even if interest rates start rising within the next 10 years. They will edge up slowly. In 10 years a guy with a 25 year mortgage is 40% paid off on that mortgage. Do you think he would sell the house for less than his mortgage + his down-payment? If he did, then that is asking him to cut off his left testicle and donating that to you for free. Don’t forget that Vancouver has limited land being a peninsula.

      The thing with the current real estate market is that scrubs that are selling because they are scared that the market is going down skew the numbers in the short term and make it look like the market is going down. Anyone with the holding power to keep holding will hold onto their properties. So the question is what happens after these scrubs sell? When supply runs out from scrubs that are selling, then prices edge back up and revert to market prices. Also, look at it this way how many scrubs are pissing their pants to sell in the market right now? If you look at the daily listings it is actually less than you think. So will the market rebound fast? This is the next question lol.

      So the final golden question is will house prices come down just because you want it to? ^^

      • Reply
        Buskas 8 months ago

        I r trash panduh, I do economiks gud

      • Reply
        Escobar 8 months ago

        Panda, in your analysis you forgot to account for a basic variable/factor of market trends. Speculation. Loss of confidence wasbone of the biggest factors of the great depression. What usually follows periods of great boom, like the roaring twenties or the 90’s are periods of bust like the great depression or the great recession. Yeah most people that can hold on to their overvalued assets could try to do that.. But it’s an analysis that needs to be done. The only issue with your logic is that you expect the real estate market to go back to the insanity we’ve experienced leading into this period. That’s not realistic. A smarter “SCRUB” would realize thus, cut their loses and look for a better investment to make up for their loses. As soon as rates rise, your return on investment in this new market will be horrible. And the ONLY SCRUB left will be people that didn’t realize they missed the boat a long time ago

  • Reply
    Trash Panda 8 months ago

    Trash Panda much kawaii http://imgur.com/wEcx2Jj

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