The summer months of 2010 have been marked by a dramatic decline in sales, building inventory and price reductions galore. And bearish market watches sit poised to gleefully herald the long anticipated market correction.
But while August stats will be ample fodder for this outcome, the month's statistics also contain a foul element for the bearish community.
Back in springtime the average price of a detached house price in Vancouver broke through the $1,000,000 mark. And while it declined to $941,275 in July, the August figure has jumped back up to $999,407.
How can this be?
As record low individual sales are broken down, I suspect we will see more westside homes like this one profiled in the Vancouver Sun.
A prime example of some of the bizarre sales of high end homes, this 4-bedroom, 5-bathroom 2,462 sq. ft home (with a measly 33 ft frontage) located at 4036 West 19th Aven. was assessed by B.C. Assessment in July 2010 at $1.508 million.
That, however, was 'assessed' value. The owner listed the house way over assessed value and asked $2.388 million
After 9 days on the market it sold for $2.39 million.
And that has been the hallmark of the Vancouver market and one of the surest signs we in are a massive bubble: when people massively overpay for an asset.
Those conditions are clearly at play now. And even with a dramatic reduction in sales, those houses that are selling are exchanging hands at values dramatically higher than assessments.
The end result is that the average price rises despite the dearth of sales, such are the ridiculous asking prices currently being trotted out by speculators and long time owners alike.
Even this house, which sold below asking price, sold at a ridiculous price.
Located at 3946 West 30th Ave. in Vancouver, the house was purchased in 1981 for $195,000.
This summer it was listed with an asking price of $2,188,000. After 51 days ti sold for $2,050,000.
Thus is the state of the Vancouver Real Estate market, North America's most bubbly real estate market.
The R/E cheerleaders will point to this sales as an example of why it's different here... hallmarks of Vancouver's resiliency.
History is replete with stories of excess at the end of boom times. And the Village of the Rainforest is no different from those tales.
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