Increasingly, as the mainstream media repeats the message, the reality of the real estate market is seeping into the public consciousness.
The latest missive comes courtesy of the North Shore News which blares: West Van home buying frenzy loses steam.
Recently released reports on the Lower Mainland’s real estate market hold a message for the sellers of high-end homes in West Vancouver: The party, it would seem, is over.
In a June 4 data package, the Real Estate Board of Greater Vancouver reported that regional home sales had seen their slowest May since 2001, and that the decline had been led by a once white-hot West Vancouver and other pricey enclaves.
For much of last year and perhaps longer, the Lower Mainland saw a frenzy of buying at the upper end of the market, widely believed to be driven by an influx of investment from China. The phenomenon pushed the price of already expensive property into the stratosphere, with a typical West Vancouver detached home jumping 20 per cent in just 12 months, according to the board. Tony neighbourhoods in Richmond and Vancouver’s west side saw similarly disproportionate booms.
The latest batch of data, however, suggests that surge in luxury purchases has slowed. Sales in West Vancouver saw a dramatic drop in May, according to the real estate board, with just 100 residences changing hands compared to 201 for the same month last year.
The North Shore News notes that despite the apparent slowdown at the high end, home prices in West Vancouver haven’t dropped significantly - yet.
But the News also notes that "other reports released this week suggested the outlook for the whole Lower Mainland market will soon darken."
Much like the locally produced X-Files mantra, the truth is out there.
And if conditions don't change by autumn, the term 'fall' could be used to describe much more than the season.
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The market cant handle the message!!
ReplyDeleteThe thing that will be hard to deal with as people is that the downward trend will take a good long while. Already down 12% YOY. If the market corrects another 5-10 % or so over the next year, then calls will be made in error of a 20% drop indicating stability with froth removed from market along with that oh so favorite realtor word of "balanced". Just as it is hard to know the top of the market it is hard to know the bottom until after the fact and the slow but consistent nature of price decline will provide disguise for some. The reality is that the decline will continue along in a slow melt for some time as the reversion to mean process unfolds. This could last 5-10yrs IMHO.
ReplyDelete+1 completely right. UK is now five years after the bust and -- whilst some sellers refuse to accept reality -- prices are down 35% from peak. But just under half of that is slow decline in the last three years (approx 5%/year)... one interesting thing: the shape of the market is changing, too: because fuel prices are up , SFHs a long way from work are way out of favour and are being hit disproportionately hard. Implications for sunshine coast and Fraser Valley?
DeleteWho knows,Europeans have had enough pain, relize that the US banking system also is done and head er up to Canada. And buy er uppppppppp. Don't wanna live in America...
ReplyDeleteu r a dweeb
DeleteYou are missed, Whisperer. Where are you?
ReplyDeleteFarmer
Whisperer went fishing and didn't give us a heads up? What the hell?
DeleteNeed to read your new blog, can't wait any longer!
ReplyDeleteBoth silver and gold followed the US dollar down again. This is really an interesting development and it is unusual. It does make you wonder if investors have finally concluded that no hyperinflation (or even a serious inflationary event) are even remotely likely anymore. With China decelerating and as its housing bubble deflates with Europe sinking into recession then the obviousness of deflationary pressures have finally made plain for all to see. Precious metals offer no assurance against loss of buying power. Cash is still king.
ReplyDeleteFarmer