Friday, February 8, 2013

It's been 8 months since the HPI peak... how does Vancouver compare?

The image above is from an interesting chart posted by Observer over on Vancouver Price Drop.

As faithful readers know it has been eight months since we hit what now appears to have been the peak of our housing bubble (using the industry's franken-number, the HPI).

So it begs the question... how does Vancouver compare to US cities  when they were 8 months into their housing collapse?

That chart you see above plots the progress of Phoenix, Los Angeles, San Diego, Washington, Miami, Tampa Bay, Chicago, Boston, Minneapolis, Las Vegas, New York, Portland, Seattle and... Vancouver.

Vancouver is represented by the green line with the green circle:

The other cities identified as such:

Each starts at what is now accepted as their peak. Observer has combined the data from Vancouver West, Vancouver East, North Vancouver, West Vancouver, Richmond, Burnaby and New Westminster to provide a representation of the metro Vancouver area.

 The data is taken from the MLS HPI

To give you a sense of what is happening in our housing bubble, after 8 months Vancouver has plunged faster than all those other cities did at the 8 month point of their drop (with the exception of  Miami).

That's a chilling statistic.

Here is the full graph with the other cities plotted over 48 months as their collapses played out fully.

Where will our's be in a year and a half?

When you consider that realtor's like James Wong believe the market looks ripe for a very meaningful correction in the months ahead, it gives you pause to consider the broader picture with grave apprehension.

(click on image to enlarge):


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  1. And everyone will say "whocouldaknown"?

  2. Okay..I have just postponed buying for at least another 24 months. Buying now would be like hitching a ride on the Titanic.

    Thanks for your great work

  3. Demographics, deleveraging,and no growth will extend those lines to the right for the forseeable future.

  4. Wow... that's an incredible perspective. How many locals think we are crashing at a steeper rate than all those cities?

    I know I haven't looked at it that way. Very relevant youtube clip/song.

  5. It looks like it takes up to 20 months for things to really pick up speed which suggests another year of a slow melt before the real drops begin.

  6. Yeah, don't worry about this year ...

    "Serpent year lucky for Vancouverites

    By Tyler Orton, 24 Hours Vancouver
    Thursday, February 7, 2013 6:25:36 PST PM

    The Year of the Snake is set to be a prosperous period for West Coast residents thanks to the city’s close proximity to the ocean and its prime spot nestled next to the mountains, according to feng shui expert Marlyna Los."

    (for what it's worth)

    1. Yes, let's inspect chicken entrails next to confirm the feng shui expert's findings.
      I hear they are burning witches in front of the Vancouver Art Gallery to ensure a prosperous lunar new year.

  7. So instead of the MSM doing investigative reporting like this blog, we have them quoting Feng Shui "experts". Hoo boy, what a city we have become. Can you just imagine seeing a graph like this in the Vancouver Sun?

    1. You will NEVER see a graph like that in the Vancouver Sun.

      There is a higher likelihood of seeing a full frontal nude picture of Jim Shaw's grandmother on the front page of the Vancouver Sun...

  8. Are these numbers relating to sales volume or price drop?

  9. The real estate cartel and media in every US city talked bullish about real estate, at their peak, the same way it is happening now in Vancouver and Victoria. They thought a crash was impossible in the US - until it happened.

    In two years from now we can point to this discussion and explain to others how obvious it was that the housing markets in Vancouver and Victoria were about to correct/crash.

  10. Just for fun I searched "Vancouver Price Drop" in the Vancouver Sun. I won't spoil the ending for you.

    1. I got articles on Roberto Luongo. I trust you got something more worthwhile than I?

  11. Just drove around the False Creek/Olympic village area of Vancouver, I counted atleast 10 condo building in various forms of construction, all within a very small area of Cambie to Main St.
    These developments are within a 2 blk radius of the Olympic village which is I believe still 30% un sold ?, with these many condos in such a concentrated area it will be interesting to see if this ends up being the "center" of the Van condo correction/crash ???
    The building directly alongside the CAMBIE St bridge has been completed for approx. 3 months and is still not fully sold, so what chance the building within a few blks that are still not complete- price war ?
    Would be interesting to do a little digging to see what the pre sales etc are looking like !

  12. Foster by Mosaic. This building is a french style chateau. Southeast facing Penthouse with Superb style and layout. Corner unit with spectacular large balcony, 2 parking and locker. The building will be ready for occupancy approx Spring2013. Pets and Rentals 100% allowed no restrictions. We have 40 other units for sale by assignment, all of our units are first pick - meaning the best locations and best lay out.

    Wow - 40 units to pick from - in a building that is going to be ready this spring.
    Crunch time?