Mon Post #1: Vancouver home prices are dropping

Realtor Larry Yatkowsky is out with his latest figures and for the fourth consecutive month the average detached home price in Vancouver has dropped.

Prices have gone from February’s high of $1,235,244 to a current average price of $1,061,067.

More significantly detached home sales are down 37% from this time last year and total active detached listing have soared 27% higher than this time last year.

Over on the blog Vancouver Price Drop, we are starting to see some significant price reductions. A couple of examples...

Address:# 206 1477 FOUNTAIN WY, False Creek, Vancouver West

March 09	V924617	$568,000	$0	0%
March 12	V924617	removed
March 28	V939572	$498,000	$-70,000	-12%
Open House: May 27
Open House: Jun 03, 10, 24
Open House: Jul 01
June 30	V939572	$320,000	$-248,000	-44%

Assessment: $463,000

Amazing Value-best price in the Creek! Experience one of Vancouver’s choicest communities at Granville Island with all its shops, restaurants, theatres and galleries. This well finished 2 bedroom condo exploding with light, enjoys a sunny SE exposed fenced patio in a tranquil setting. It also acts as a second entrance. With close to 1400 sq ft that will take your household furniture, a vaulted living room with garden outlook, air conditioning for comfort and a rustic kitchen with nook and library, you’ll feel instantly at home! Pluses include custom ensuite, large walk in closet, storage locker and full security. Easy wheel chair access & larger doors in the condo ease access. Open House every Sunday 1 to 3!

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 Address:4611 WOODBURN RD, Cypress Park, West Vancouver

March 15	V937107	$3,388,000	$0	0%
April 11	V937107	$3,188,000	$-200,000	-6%
April 24	V937107	$2,888,000	$-500,000	-15%
May 01	V937107	$2,688,000	$-700,000	-21%
Open House: May 20, 27
Open House: Jun 03, 10, 24
June 29	V937107	removed
July 02	V959849	$2,398,000	$-990,000	-29%

Assessment: $2,279,000

This 58,806 sq.ft. (1.35 acre) property offers total privacy with awesome ocean views. The gated entrance leads to a private rock bluff setting overlooking the views from Lion’s Gate Bridge to Vancouver Island. This spacious 5615 sq. ft home offers 3 bedrooms, 3 bathrooms, vaulted ceilings, sun drenched decks and a master bedroom with spa like ensuite. Perfectly located near Caulfeild Village, Rockridge High School and Caulfeild Elementary. This home offers a 3 car garage and indoor swimming pool to complete the package.

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 Address:3529 MATHERS AV, Westmount, West Vancouver

March 09	V924752	$4,188,888	$0	0%
April 12	V924752	removed
April 21	V944692	$3,980,000	$-208,888	-5%
May 26	V944692	$3,688,000	$-500,888	-12%
June 29	V944692	$3,288,000	$-900,888	-22%

Assessment: $3,412,000

A Sensational, almost new 5500 SQ FT, 5 bedroom, 8 bathroom home in sought after West Bay with good City and Ocean Views. Walk to Erwin Park Elementary School & the Beach. This luxury home features a large gourmet kitchen, large family room and elegant living and dining areas. The upper level features four bedroom suites including a lavish Master Suite with private patio overlooking the ocean. Enjoy a fully finished lower level with Games Room, Wine Room and Gym plus bedroom for nanny. Other features of this finely detailed home include beautiful hardwood floors, state-of-the art security system, hot tub, exercise room, wine cellar, triple garage, heated driveway. Best value in the Westmount/West Bay area…

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Happy Dominion Day/Canada Day

Dominion Day was the name of the holiday commemorating the formation of Canada as a Dominion on 1 July 1867. The holiday was renamed late at night by act of parliament without a quorum Canada Day on 27 October 1982.

So while we call it Canada Day now... I fondly wish everyone who drops by today a Happy Dominion Day. Happy Birthday Canada!

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Are bloggers Public Enemy No.1 in an attack on the fundamentals?

Watching the news this week, you can  can see the real estate industry mounting their latest counter offensive to spin their message.

And that message will be... 'fundamentals don't matter'.

Despite having rejigged they way the benchmark price is calculated (twice this year, actually), the reality of the market is becoming hard to ignore.

Sales in May for all forms of housing across the Multiple Listing Service were down over 15.5% from last year, and the lowest for the month of May since 2001. For detached homes sales, the news is  even worse: They were down 25% for the same period last year.

While sales have fallen, the number of listings has risen. In the Vancouver westside, which is held up as the main beachhead for the Asian invasion, the total of active listings — those homes for sale that haven’t sold — has risen to 1,100 properties at present from 600 a year ago.

The pathetic attempts to neutralize the impact of these figures prompted Vancouver Sun columnist Pete McMartin recently to state the obvious:

Commenting on these numbers, the resolutely sunny Real Estate Board of Greater Vancouver decided this was “indicative of balanced market conditions.” But then the board would have viewed the crash of the Hindenburg as the result of “normal deflationary conditions.”

Yesterday we drew your attention to one of the latest piece by Global TV (Global reports the facts, concludes ours is now a 'depressed market', but then claims we're 'different').

 Global has also been unable to ignore the obvious:

Vancouver Real Estate had defied trends and showed steady growth for far longer than anybody believed possible. The evidence is not in the polls, which very often contradict one another, but on the ground, in the neighbourhoods where plum properties have always sold quickly and at a profit. Sellers are finding the days of multiple, over-asking offers have disappeared... and buyers are getting the pick of the crop with buyer reduced signs popping up all over the place.

They were even forced to admit that Vancouver is now "a depressed market".

So if the spin no longer works and the ugly numbers cannot be ignored, what do you do?

Invalidate the usefulness of the numbers, of course.

You could see the strategy launched when Bob Rennie spoke to the Urban Development Institute on May 17, 2012. Rennie said:

I joked with the CHMC’s board a couple of years ago, that the Vancouver market never went up on fundamentals, so why would we go down on fundamentals.  

However, our market really does have fundamentals but our fundamentals cannot be captured in a 90 second elevator conversation, at the water cooler, in a sound bite, and especially not on a blog or 140 character tweet.

And what are those fundamentals that cannot be captured in a 90 second conversation?

I think we saw that in the Global TV piece yesterday as well.

The spin we are going to see is the same as we have heard over and over before. "Rich people wanna live here.  We have limited area due to the mountains and the ocean.  And we have the scenic and lifestyle advantages of those same mountains and ocean." 

This is basically what Global TV said when they trotted out Tsur Sommerville:

Sommerville: Now we have a situation where prices aren't rising, they're flat. We have a situation were listing are rising, sales are falling and there isn't any of the kind of angst or anxiety out there in the marketplace. Instead what it's replaced with is less worries about people driving prices up and more worries about Greece blowing up the world economy.

Global Reporter: Vancouver is that market that is way different than any other kind of market.

Sommerville: Vancouver is very hard to figure out because so much of the purchases are done by wealth. Either people immigrating with wealth or people receiving wealth from parents or relatives so the normal 'what are incomes doing and what are prices doing', that just doesn't work out here well.

Global Reporter: And that may explain that while there are price reductions, average selling prices just aren't going down. Unlike other depressed markets in the world, there's no pressure to sell. And with our geography, the mountains and the ocean, it's not likely to change.

I suspect this will be the theme for the foreseeable future.

Claim prices simply can't go down here.  Tell everyone that wealth wants to be here. And desperately try to convince you to "buy now or be priced out forever".

And to the one segment of the community that the industry can't influence the peddle this message - the blogosphere - Rennie summed up his frustration in that May 17th UDI speech:

I do have a huge concern over what Tracie McTavish, the president of our company calls, your “Keyboard Courage”, referring to what is becoming a dangerous and apparently acceptable practice which is, negative market commentary that is nothing but speculation.

Speculation made by spineless, signature‐less, individuals on a blog, on a blog that in most cases has less than 500 followers.

Then the next thing you know, the mainstream media picks up on the negative as fact and all of a sudden, it’s breaking news and our industry spends the next 6 months attempting to dispel the rumors and sound bites.

The dispelling of the "rumours and sound bites" of the basic market fundamentals (ie. the inescapable reality of the hard sales data) has begun.

And it would appear that in this attack on the fundamentals, the blogosphere is being cast as Public Enemy No.1.

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Email: village_whisperer@live.ca
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