Thursday Numbers

Busy day, so short numbers tonight.  320 new listings, 271 sales, 104 price changes, sell/list of 84.69%.  Inventory broke 12,000 again, reaching 12,008.  Over 90s dropped to 1,830, or 15.63%.  The 14 day rolling sell/list climbed to 65.24% 

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43 Comments

Filed under Daily Numbers

43 responses to “Thursday Numbers

  1. rob1

    good numbers…

    is it because people r rushing to get out?

  2. macchiato

    Has there been an increase in the number of expiries recently? They seem to be high over the last two weeks, but I haven’t kept close tabs before.

  3. sutluc

    If people are rushing to get out then it looks as though plenty are rushing to get in as well.
    I’ll wait, thanks all the same!

  4. jim

    Listings drive sales. But inventory is a relentless rising tide. If you’re on the beach and the tide rushes out suddenly, don’t wander out to look at all the pretty shells and flopping fish. And I would rush to buy a house just yet either.

  5. jim

    sb: And I would not rush to buy a house just yet either.
    Look up….Wow that’s a funny looking wave way out there….looks like we’re gonna be under water for while hon.

  6. millionpitfall

    Two days of good numbers is hardly people rushing to get in. The first week of May had list/sell numbers from 73% to 83%, but the second week of May the list/sell ranged from 27% to 61%. This week we are up, next week we are down?

  7. Anonymous

    Interest rates going up in July, and more than one hike by the sounds of it. Tick.. tick …tick……

    http://www.reportonbusiness.com/servlet/story/RTGAM.20070518.wretailsales0518/BNStory/Business/home

  8. tqn

    “This week we are up, next week we are down?”
    because the bear made a deal with the bull, the bear works one week and take the next week off, and the bull’s turn. “You and I would drive the buyers crazy, keep ’em guessing”, said the bear!

  9. millionpitfall

    If prices are supposed to go up and the market is so hot; I find it amazing that so many flippers and landlords are rushing to exits now. Why not wait, if your going to make so much more cash in this so called bull market in the future.

    Even our realtor who use to flip properties, stopped buying so that speaks volumes in itself.

  10. renting

    I predict that house prices will either go up, down or stay the same by September. Same for the sell/list ratio.

  11. millionpitfall

    tqn,

    Sounds like the job sharing ideas of the past with a new twist.

  12. robchipman

    million:

    I think its fair to say a hot market is one with lots of sales volume. Price direction is secondary. I know that from my point of view if we had lots of sales and prices were being beaten down I’d still consider it busy, and hot. Clearly different from a rising market, but with similar pressures to get action. (That’s theory, right? Because we all know that with clear indications that prices are falling demand will become…well, let’s just say that the patience exhibited by buyers will be greater ;-))

    Bottom line, this market is still hot. Prices are rising, sell/lists are good, places sell very close to asking, and DOMs are low. A cold market will be characterized by generally the opposite. (Again, prices dropping, sell/lists high, DOMs low, but prices falling and sales averaging say -10% off listing – that’d still be a hot market, no?)

    I’m not sure that its widely believed that prices are “supposed” to go up. People see the trend, and see the wider characteristics of the economy, and make a call. Business is good (witness the link above from the RoB), predictions for RE price growth are positive, interest rates, even with increases, remain low from a long term perspective, inflationary pressures exist (they contribute to price appreciation) On the other side of the coin there is the consideration that the market has been so strong for so long that it can’t possibly continue for much longer. It doesn’t matter how many times we us words like “insane”, “speculative”, “greedy”, “greater fool”, etc. The argument basically remains the same. Even if we argue that current prices are detached from fundamentals I think we have to recognize that this has been the case for a while, with no negative price growth. Claiming that this is actually proof that we are exhibiting “classic” bubble signs, or that we’re even closer to the the peak, is akin to whistling past the graveyard. As the Bank of Canada paper on duration dependence indicates (I can’t say enough good stuff about that report!), duration dependence for expansionary cycles is much less predictable than it is for contractions. Its really tough to say when a boom will end.

    Clearly one side of the argument is lacking good information, and its the bear side. I’m not dismissing the argument – I’m just recognizing a characterisitc of it. The bull side has concrete, recent historical examples of growth (a trend is a trend until it changes), and the other side has a theoretical prediction of a grim future (which is the logical result of the “trend is a trend…” statement). The bears aren’t going to have proof until the current trend changes, which is the essence of prediction. The bulls, meanwhile, can simply point to what currently is.

    My point, again, is not to dismiss the bear argument, but to answer your comment about why people are selling when prices are “supposed” to go up. There is no “supposed”. For every seller with a view of the future there is a buyer with either a completely different view, or a different interpretation of that view. Selling at a profit never hurts, but you can’t ever attain that position unless you buy at some point. If the fact that someone is selling indicates that its a bad time to buy, why do sales ever occur? (Curiously there is a parallel: the seller knows what has happened, while the buyer is acting on his beleif about what will happen. Clearly one side has superior information, but that’s just the way it is).

  13. VHB

    “Its really tough to say when a boom will end.”

    Agreed. But it is not tough to say that it will end. And that is the point.

    Buy now vs. 6 months from now? Tough call. Buy now vs. 3 years from now? Easier call.

    Value investors don’t try to perfectly time markets. They just sit out ones that display little value.

  14. robchipman

    VHB:

    I might disagree with you a little about your time frames and the way to approach them (the old “buy anything if it makes sense” idea), but you are 100% right about value investors not timing markets. I’d add that the timing approach works both ways (buying and selling).

    If you’re sitting out you do need to find an alternate course of action. Doing nothing isn’t a plan (except in some very rare circumstances).

  15. jim

    As a buyer and seller I somewhat agree with Rob’s analysis. I stop short now of saying “A cold market will be characterized by generally the opposite. (Again, prices dropping, sell/lists high, DOMs low, but prices falling and sales averaging say -10% off listing – that’d still be a hot market, no?)”
    A slow market can have discreet characteristics. Any of the above with out the other. Rob defines a slow market from a realtor’s pardigm which is fine. I define it as some one playing with my own money. Rapidly declining prices is good and bad. Dead volume is good and bad. It depends on what you are triying to achieve.
    It’s riskier now than ever in the history of Vancouver to buy a house on Vancouver’s Westside. To say otherwise ignores too many variables. Even the “we plan on living in it for 10 years” argument is now weaker. If some one has a 10 year planning horizon-at least wait until September which is a better time to buy than May. As for the drive by bulls and bears they too have their own pardigm.

  16. Anonymous

    Ahh Rob, how about them interest rates going up ? No one seems to have commented and I figured that is like the number one threat to house prices. Guess your all wrapped in your arguements to read todays news, the tables will be soon turning,this is huge news after all the interest rate debates.

  17. robchipman

    Anonymous:

    Yeah, you’re right. I’m all wrapped up in making an argument so I can’t read the news. Very insightful.

    Oh, did you notice this part of my post: “interest rates, even with increases, remain low from a long term perspective”.

    Yes, I read the Financial Post. Yes, I have a few mortgages myself, one of which is variable. Yes, I have several mortgage brokers who update me regularly of rates (some by email, and two in person).

    All opinions are welcome here, but do try to pay attention to the conversation, ‘kay? Interest rates and increases to the same have been commented on not only in this post but regularly on this blog, and not just by me. The 500 gorilla is still inflation/stagflation/deflation.

    Another news flash: Canadian dollar hits 30 year high in trading. What’s the import there for i%?

  18. Many Franks

    Rob, I’m not sure I follow your argument about bulls having better data than bears. Here, both are using the same data — i.e. yours — to predict what the market is going to do. It seems a little willfully naive to point out that a first-order approximation favours the bulls. Markets do change and some resident bears have laid out very compelling reasoning for their belief that this one will change soon.

    I’ll meet your pithy “a trend is a trend until it changes” with the equally pithy “change is the only constant”.

  19. Barney

    Longtime lurker, and I will agree that a trend is a trend, but what is your timescale here? 25 year trend is 5.13% annual price growth, our short-term trend deviates heavily from that so regression to the mean is only to be expected.

    I am neither Bear nor Bull, I enjoy the attempts to apply statistics and logic to such an emotional market space; but do remember one man’s trend is another man’s blip – a circle is a straight line, if you look at it closely enough.

  20. robchipman

    Many Franks:

    As a seller I can do my numbers and say “If I sell at market price (reasonable assumption) I’ll make X%” I’m making the call based on past info. That’s my point.

    That said, I have to stress that some rational bear arguments are exactly that – rational.

  21. Many Franks

    Thanks, Rob. I’m just pointing out that any good prediction, bearish or bullish, is a combination of past performance, reason, and intuition. A linear extrapolation is a useful estimating tool, but just because it comes out bullish doesn’t mean that it undermines the bears (as I believe Barney is pointing out). The bears are using the same data but different methodology. And in a volatile market, a magic 8-ball is as good as a first-order approximation… or, most likely, better.

    While I’m shooting my mouth off, thanks for all the time you’ve put into the numbers. I probably speak for a lot of lurkers when I say that it’s much appreciated.

  22. whitebear

    http://finance.yahoo.com/real-estate/article/103038/best-and-worst-u.s.-housing-markets&.pf=career-work

    Those people who kept bragging about the bust in the U.S. and how Vancouver will be next is in for a real surprise. You can do a search on zillow on the typical houses in the Seattle, Bellevue area. SFH prices doubling in 4 years is not limited to Vancouver, but to the Seattle area as well.
    http://www.zillow.com/HomeDetails.htm?zprop=48681640
    http://www.zillow.com/HomeDetails.htm?zprop=49142039
    See the charts to the right on each of the above links.
    Seattle housing prices have hardly softened a bit in face of so-called housing bust. What makes you think that it is a bubble in Vancouver?

  23. robchipman

    Many Franks:

    I had to give a short answer earlier, as I was running out of the office. You’re right: predictions are predictions, whether bear or bull. Right now bulls also have the luxury of recent past history, and their decisions don’t have to be based on predictions. Bears are the opposite (that will change in time) in that most of their decisions are predictive in nature right now (unless we’re saying the erstwhile bull who bought is now a bear who’s selling :-))!

  24. Annon

    to Whitebear,

    Seattle was pointed out in the news that its RE lagged and therefore is still going up in some areas where industry is still strong.

    Why don’t you look at Las Vegas, Florida, Detroit, Denver, Dallas…? I am sure Zillow will show you a good price decline since you seem to accept Zillow’s numbers so well.

  25. Domus

    whitebear:

    whoever said prices were collapsing in Seattle? Who? Please, speak out.

    Just yesterday we were discussing how volumes have been going down substantially in places like California but prices were holding up.

    The drop in volumes is likely due to the bottom part of the market disappearing because of credit constraints (end of free sub-prime money). Fewer properties are changing hands, mostly in the middle-to-high part of the market.

    This often gives stable or even higher prices. Obviously it cannot last, as RE market is a ladder.

    Just yesterday I was saying that I do not expect prices to go down for a while in vancouver, but I do expect a shrinking of volumes to happen pretty soon, probably by the end of the summer.

    It is good that bears are patient animals: it takes some endurance to listen to this bull-talk, where things are twisted until they appear something they are not. Why don’t other honest bulls step in and silence such remarks? After all, whatever your opinion, this is about basic honesty…..

  26. Domus

    Rob,

    I feel like venturing in a dangerous (but entertaining prediction) this afternoon.

    I have a theory and I want to check it out.

    The past few days have seen a hike in sales: my theory says that sales have been accounted for in bulk to allow listings to take center stage over the weekend. In that case, we should have a backlog of new listings which need to appear before tomorrow in order to facilitate weekend viewing.

    Conclusion: we should have an onslaught of listings tonight.

    I have done it now…..I am sure that if i am wrong some of these bitter, fearsome bulls will raise their heads to give me me a venomous bite. But it is still fun to argue with you guys!

  27. Anonymous

    “All opinions are welcome here, but do try to pay attention to the conversation, ‘kay? Interest rates and increases to the same have been commented on not only in this post but regularly on this blog, and not just by me. ”

    I’m sorry to piss you off Rob, it was just that it was the topic of the day on the business news and I thought your talking about :

    “predictions for RE price growth are positive, interest rates, even with increases, remain low from a long term perspective, inflationary pressures exist (they contribute to price appreciation)” was not what I thought would be right if rates go up sooner and higher than most have thought, but it’s your blog, plug what you want. From my perspective it was big change with the chance of “multiple” rate increases which in my mind would decrease affordability and prices not vice versa.

  28. jim

    I think Domus is correct. But I don’t think its a conspiracy on the part og the MLS.

  29. Domus

    No, I don’t think it is a consoiracy either. it just makes sense for them to go through the sales first and then concentrate on listings before the long weekend. Just a guess anyway.

  30. tqn

    if listings are entered tonite, when will they appear on the hotsheets and the mls? will they catch the public on Sat morning for viewing this LONG weekend?

  31. jim

    tqn,domus: from the trenches. I get every listing in my target, every day. Today, for me, was about the biggest listing day this year. Means nothing of course.

  32. jim

    domus: bulls aren’t bitter, they are smug, and a wee bit aggressive.

  33. millionpitfall

    Rob,

    What year did you become a realtor?

  34. Paulb

    Bottom line its a matter of time before we ‘correct’ IF we crawl up another 20% over 2 years and then fall whatever amount…. 2007 MAY still be a smart buy. I do not think this is the case, but we have been an irrational market for the last couple years, and our economy is still trucking along….

    For the record im a bear but when is this Sh-t gonna hit the fan???

  35. millionpitfall

    Jim,

    Agree, it will be a heavy listing day. If this market trends the same as last year, here come all the listings.

  36. millionpitfall

    Rob,

    My comment about flippers and landlords is a trend that is happening more often lately. Should you wish to interpret trend spotting as bearish, so be it. A bear with a realtor, quite funny.

  37. Skeptic

    Domus: “The past few days have seen a hike in sales”

    Take a look at last May Domus, the second half of the month had a big spike in sales too.

    Millionpitfall: “If prices are supposed to go up and the market is so hot; I find it amazing that so many flippers and landlords are rushing to exits now.”

    Is there any evidence that this is happening – rush to exits ? Care to share ?

    On the interest rates, I suspect they won’t be rising as quickly as everyone on here seems to think. The Canadian dollar is at an all time high, this means Canadian exports are expensive. This means that Canadian exporters will be suffering. This will be a significant factor and could lead to rate drops.

  38. millionpitfall

    Skeptic,

    Evidence, yes. Been working with realtors a lot in last two years. Watch VOW like a hawk. I also can see the trend of flips and tenanted properties being put up for sale at a lot faster pace than the past.

    But, I won’t bore everyone with by posting all the MLS numbers as proof.

  39. accountant88

    Skeptic
    May 18th, 2007 at 8:50 pm
    On the interest rates, I suspect they won’t be rising as quickly as everyone on here seems to think. The Canadian dollar is at an all time high, this means Canadian exports are expensive. This means that Canadian exporters will be suffering. This will be a significant factor and could lead to rate drops.
    —————————

    Canadian Dollar is currently at 30 year high vs US Dollar.

    In the 1970’s, the Canadian Dollar was worth MORE than the US Dollar.

  40. robchipman

    Anonymous:

    I wouldn’t go so far as to say you pissed me off. But you did say nobody had mentioned interest rates hikes. You’d mentioned it earlier, and I’d alluded to it in this post, so your observation was incorrect. You then concluded, on teh basis of an incorrect observation, that I wasn’t reading the news because I was trying to make some sort of argument. I may be making an argument, and you and I may disagree on how much interest rates are going to change, but one fact is clear: I read the news and stay on top of rates.

    Million:

    I was licensed in ’86, but I’ve been involved/around real estate almost as long as I can remember.

  41. Domus

    Rob,

    any chance of getting to see Friday’s number earlier rather than later……just curious whether my theory about listings was right or wrong…….

  42. Domus

    …and, it’s a long weekend, we might suffer from numbers’ withdrawal symptoms…….come on……

  43. coco

    Domus,

    I noticed when listings are high on Fridays, a lot of times the numbers are not posted until Monday or are mixed in with Monday’s numbers. Don’t hold your breath, it is the long weekend and they may not be posted until Tuesday.

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