Yesterday I came across the above chart (click on image to enlarge) courtesy of Makaya on VCI.
The chart is produced by Canadian Watchdog and puts the growth of listings for newly/recently built Single Family Houses in Richmond and Vancouver West in astonishing perspective.
Never before in history have so many properties been on the market for sale.
Should the housing correction pick up speed, the rush for the exits may truly become epic.
(Hat tip Makaya)
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I read the "Listings per Year Built" as the number of listings by the year the house was built, not by "how many listings there were in a given year". From that viewpoint the numbers look reasonable and normal - how many houses built in 1912 can we really expect to see for sale at a given time?
ReplyDeleteMakes sense that a lot of the listings would be new or nearly new builds - probably pretty typical. And the spike of listings in houses built around the late 1980s to early 1990s makes sense too - the boomer generation would have been trading up around then as their families got larger.
Well, I don't agree that this is pretty typical.
DeleteWhat we're talking here is new built of SFH (not condos or townhouses) in Vancouver West and Richmond, two areas that have not seen (because of land constraint) major development such as the ones we've seen in Langley for example.
What this graph shows is that 30% (last couple of years) of the SFH listings in these two cities are made by flippers/speckers/developers (doesn't matter how you call them) that have bought tear downs, rebuilt, and now trying to sell for a profit. This number is indeed astonishing if you add on top of it those SFH that have been bought during the last couple of years, received cosmetic renovations and put back on the market.
This segment of the market is most likely the pricier one ($2m+) and this is precisely the one that is not currently moving (I think MOI around 20 or something like that).
I believe, if a significant increase of sales doesn't materialize during the fall season, that these sellers will start panicking. If so, watch out below...
Sorry but the chart has been interpreted incorrectly. The chart is showing how many houses are listed today that were built in a particular year. The spike in 2012 shows that a lot of properties were completed just this year and are probably teardowns that were purchased in the last few years for a "quick" profit.
ReplyDeleteIf sales continue at the pace they have expect some relatively cheap brand new West side houses for sale next year.
all the graph says is that the more expensive homes (2.9M +) are newer. not rocket science.
ReplyDeletepoor example. i'm not disagreeing that prices are inflated... this graph just doesn't prove anything.