The Chief Pumper at the BC Real Estate Association is calling it the bottom over in Nanaimo today. Shilling in the Nanaimo Daily News, Cameron says:
"This is the second month, seasonally adjusted, we see a rising trend in consumer demand," said Cameron Muir, B.C. Real Estate Association chief economist. "I'm calling this a transition year. I think we're about to embark on another upswing."
Happy days are here again?
Never mind that every other market in the Island region, save Port Alberni, saw average selling prices decline. In popular Parksville, they fell by as much as 6%.
We're in a transition to rising prices?... Woohoo!
Back on the mainland, rational realtors don't seem to share Muir's enthusiasm.
While west side realtor Sam Wyatt is also reporting an uptick in sales...
While west side realtor Sam Wyatt is also reporting an uptick in sales...
Months of Inventory (MOI) fell to 5 months for Vancouver detached homes. It remained at, and fell to under 5 months for attached homes and apartments respectively.
Vancouver real estate is now back to the MOI levels of last spring. I was pleasantly surprised that May was a such a good month for sales volumes for both my clients and the Vancouver market. Those sales volumes are what helped drive down the MOI in spite of high volumes of active listings.
... he doesn't view this as a springboard to a market surge:
Sales volumes generally peak in the Spring so it is likely that May will be the high point for the year (though I said that about March). May's real estate sales are comparable to May of last year but the trend to lower volumes of sales remains apparent. Unlike sales volumes, active listings don't typically peak until mid summer so It will be very interesting to see whether sales remain strong and listing volumes drop over the next few months. I will be surprised if either is the case.
Sounds like a rough transition, Cam.
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It's not a bottom until Tsurd Sommerville says it is.
ReplyDeleteLOL...
ReplyDeleteFear and greed....the human nature never ceases to amaze me
Oh I know. Everyone in the world wants to live in Nanaimo. I forgot. It will be the new hot spot.
ReplyDeleteCam is paid to pump - his employers are very happy with him. Unfortunately the media allows him to speak verbatim.
ReplyDeleteI wouldn't be surprise that the evening TV news audience start plummeting ala Vancouver Sun.
Sales volumes in may were marginally better than 2012's abysmal numbers and our come the shills declaring the start of a new bull market. Truly we are learning much about the people in the real estate industry, and its not flattering.
ReplyDeleteIn July, 2012, Mr. Muir said: "The pace of home sales slowed during the first half of the year. However, the downturn is likely to be temporary as population growth, persistently low mortgage rates and encouraging employment figures suggest a stronger second half of 2012."
ReplyDeleteHome sales in B.C. for the first 6 months of 2012 was 38,341 units. For the second half of the year, 29,325 units were sold. First half transaction volume was $20.5 billion. Second half volume was $14.4 billion.
Mr. Muir's record of prediction speaks for itself.
Cameron says....I guess it will be ALL GOOD now since he said it. Man, it's getting comical out here. We are on the downswing in year #2 ( yes, most of 2012 was a slump in RE just don't as your agent)...the downturn will last 5+ years....check out the history of boom and bust in US and Japan. We just have not seen once since the late '80 or early '90....nice to see reality hit back for a change.
ReplyDeleteThere is an article titled - Why are home prices so high and when will they fall? - on cbc today.
ReplyDeleteOne aspect that frustrates me so much is that with all the talk of unprecedented credit growth, hot asian money, government medling and such, one huge factor that is never mentioned in the RE dirty little secret of PRICE FIXING!
If you look at the last 6 years on the news outlets, they've been forcasting houses in the Vancouver area to surpass $1M. Why is that? Unless CREA with the help of mortgage lenders and the CMHC were all in cahoots to achieve that target.
Not much different than say Nestle and Mars fixing the price on chocolates.
But one might ask for what purpose? The most logical in my point of view is the coming flood of retirees that have little in savings or pensions. The government simply doesn't want to shoulder that cost in the near future. It will drain already
indebted government levels and therefore it is simply easier to make the younger generations or wealthy immigrants flip the bill.
I doubt anyone in the media or finance will try to expose this fact.
In response to "Farmer", it should be noted that if the average buyer puts down 20%, say on a $500k property and the property devalues by 11%, that buyer will have lost 55% of his equity, exclusive of transactions costs. It is the debt/leverage which is the killer here.
ReplyDeleteIt was all great going up, but when he goes to refinance, many properties in the Lower Mainland which were purchased from 2009 and following, he will find unless he has bought in one of the more resilient areas (and there are a few of those) that he is short on refinancing.
The bottom line is that with debt, the gain or loss is amplified by the % borrowed, such that a 5% change on the total asset is 5 times that with an 80% loan to value.
We are only about 50% through those 5 year mortgages of properties purchased at high values.....wait until refinance time!
That said, there are still some bright spots which have held up pretty well (even in Richmond) considering what has happened in other areas of this city.
The mid-range townhouse has also fared better than the Single family dwellings