There were 315 new listings Wednesday, and 201 sales, for a sell/list of 63.81%.
There were 131 price changes.
The 14 day rolling sell/list was 65.93%
Filed under Daily Numbers
I would like to see a thread on whether or not it is justifiable to compare Vancouver to US cities like Miami or San Diego. I heard that the reason that Florida is seeing lower house prices is more due to the cost of property taxes and house insurance than to the cost of housing itself. I can’t speak for San Diego. I know property taxes are deductible in the US but you still the the income flow from which to deduct them n’est-ce pas?
this seems like a lot of listing for Mid July. Is it normal?
We’re getting strong listings. No question. It may be that some sellers are more worried about rising rates than buyers are. (Mind you, the news this morning had the BoC saying that inflation will peak at 3% in Q4, and 1 more increase and the high dollar will cure the problem, so rates may not continue climbing. We’ll see). Anyway, I’m going to get one listing based on interest rate fears. On the other hand, the seller is going to turn around and buy more (improve his holdings).
I think you mean that mortgage interest is deductible, not property taxes (although they may be as well). I know Florida is flat and seems to have no real boundaries on land supply, but San Diego is quite different. Mountains, border, ocean, Camp Pendelton. Maybe there’s an argument there.
It is hard to tell what a distant market’s characteristics are from here. I’d assumed land was easy to get in Las Vegas. 2 different clients who live and own there disagreed with me strenuously. They claim supply is very tight.
The numbers tell me there is a serious crash up ahead. In fact for about 10 or 11 months in a row, sales were dropping and inventory was increasing, and so were prices, which fly in the face of the housing shortage spin, and the supply/demand rationalization.
As for the San Diego question:
Here is a well spun report from a San Diego Realtor:
Welcome to sunny, balmy San Diego County and its RAGING Buyer’s Market! We love sharpening our pencils and battling on behalf of our clients. For our buyers, we are negotiating some incredible bargains (call and ask how low!).
Savvy sellers who are serious about getting their homes sold; trust we can get the job done. If a property isn’t selling it is either because of condition or price or both. It is the MARKET that determines property value–not the agent, the seller or concerned neighbors.
The prior market where sellers could sell to the highest frantic bidder is long gone. Pricing is now determined by the market, and what a willing and able buyer is willing to pay. That buyer, in turn, may compete with other buyers to determine an equitable sales price. To see the most recently published market report, go to:
Additionally, a recent USA TODAY article reconfirms that “Home Sales Shifting into Buyer’s Market.”
We remain optimistic about the San Diego economy and see this pricing adjustment as a healthy and normal phenomenon. Furthermore, we have had a recent surge in buyer calls. It may be that shrewd buyers waiting in the wings are now stepping into the market. It is an entrance that should please both sellers and their agents.
I know I will be eaten alive for this…..but could it be the start of a rush for the exits? The past 12 months have seen sellers piling up in many NorthAmerican cities….why not Vancouver? The mountain, the ocean and the Olimpycs????
Just a thought…..
Here is an article that I tried to post a link to a few days ago. I found it a quite interesting review of the country-wide British experience with RE over the last 30 years. Any lessons for us here?
If you find the case studies too lengthy scroll to the stats at the end – fascinating!
Reprinted from the Daily Telegraph.
The rise… And rise… AND RISE…
Last Updated: 12:01am BST 07/07/2007
Over the past 25 years the price of this home has soared. And the story is the same all over the country…
55 PALACE GARDENS TERRACE KENSINGTON
2007 Under offer £5.5 Million
The “Bank of Mum and Dad” has had quite a hand to play in Britain’s 11-year-old property boom. It being near impossible for an ordinary person on an ordinary salary to get a foothold on the property ladder, first-time buyers are increasingly driven to go cap-in-hand to their parents to ask them for a hefty deposit. But how did Mum and Dad themselves afford their own home? A lot more easily than today’s buyers. In 1977, according to the Nationwide, the average British home cost £12,800, against today’s average of £181,584. That figure needs to be put into perspective. Over the past 30 years, using the Office for National Statistics’s longterm indicator of prices, general inflation has slightly more than quadrupled. In today’s prices, the average house in 1977 cost £52,700. In other words, house prices over the past 30 years have more than trebled in real terms – hence the difficulties in which today’s buyers find themselves.
Some of the inflation is undoubtedly due to property shortages created by low levels of house-building. But above all it has been caused by a combination of lower interest rates and a much more competitive mortgage market. In the 1970s, borrowers had virtually to beg for a home loan, lenders stuck to a rigid rule of advancing no more than three times a borrower’s salary and banks and building societies operated an effective cartel, meaning there was little point in shopping around for a better deal. Nowadays, some lenders will lend five or more times a borrower’s salary.
As some of the stories below demonstrate, in the 1970s many house-buyers were reluctant to borrow money at all. While the easy availability of mortgages may seem to have made buying a home easier, the house-price inflation which has resulted has ultimately achieved the opposite. Many frustrated buyers will sob to learn what buyers used to pay for a roof above their heads.
55 Palace Gardens Terrace, Kensington
# 1983: £200,000 (leasehold and divided into flats)
# 1986: £450,000 (leasehold and divided into flats)
# 1986: £675,000 (still divided into flats, but with freehold)
# 1990: £1.15 million (a single building)
# 2007: marketed for £5.5 million (now under offer) by John D Wood.
When Peter Young of John D Wood moved into Palace Gardens Terrace in Kensington in 1984, he had to rub shoulders with a lady of the night. Most of the stucco villas were divided into cheap flats and it was a busy bus route. Over the years, Mr Young has seen the street gradually turn into a very expensive enclave for wealthy bankers and businessmen. He has also seen the values of the houses multiply.
Thirty years ago no 55 housed a number of flats, while the ground floor was a doctor’s surgery. The building was held on a short lease, due to expire in 2006, with the freehold held by the Church Commissioners. The street really began to go up in the world in the mid-1980s when the church sold many of the freeholds. In a few months in 1986 no 55 was sold twice: leasehold for £450,000 and then freehold for £675,000. Between times, however, the owner had to buy out the sitting tenant in the basement for £20,000. The new owners spent £350,000 refurbishing the building, re-converting it to a single dwelling. When they sold in 1990, the next owners tore everything out and refurbished it again to a higher standard. In the process they also created an extra room in the attic.
The value of houses in the street was enhanced when Palace Gardens Terrace ceased to be a bus route in the early 1990s. “The residents persuaded the council to allow them to replace the ugly modern street lamps with Victorian ones, which the residents paid for at £1,500 each,” says Mr Young. “The result was that the street became too dark for buses. We held a meeting before the street lamps were changed, at which someone objected on the grounds that residents might be mugged if the lamps were replaced. An elderly lady at the back said: ‘If I am going to be attacked I would much rather it was under a pretty Victorian streetlight than under a horrible concrete one.’ And with that, the plan was passed.”
Hinton Manor, Hinton Parva, Wiltshire
# 1970: £25,000
# 2007: on market for £1.8 million (Carter Jonas, 01672 514545)
In 1970, advertising executive Michael Talbot- Ponsonby had no desire to take out a mortgage, says his daughter Caroline Pilkington: “People just didn’t in those days.”
Nevertheless, thanks to an inheritance and the sale of the small £6,000 cottage in which he then lived with his wife Judy and four daughters, he was able to scrape together enough to buy Hinton Manor, an eight-bedroom 6,000 sq ft manor house in 22 acres, for £25,000.
“We were in South Africa at the time, so my father had the surveyor’s report sent to his mother,” says Caroline, who was then 11. “She read it and thought he was completely mad to be spending so much money on a house which had damp. We were very excited, though. The house had stables and was surrounded with woods and fields. We used to pack some sandwiches and go riding up on the downs all day.”
Unlike nowadays, when it has become customary to refurbish a country house top-to-bottom, the Talbot-Ponsonbys didn’t do a lot to the house. But they did get round to scraping off the yellow paint with which the previous owner had covered the fireplace in the drawing room. “When my sisters and I were in our 20s, we used to bring people down for the weekend and fill the house,” says Caroline. “They had to work, mucking out the hens and so on, but then my father used to take everyone down the pub and drink them under the table. The house expands: last summer we managed to accommodate us and our 13 grandchildren.”
Sadly, there will be no more family gatherings at Hinton Manor. Judy died in the 1980s and Michael in March of this year, leaving Caroline and her sisters Lotty, Lucy and Spud (real name Catherine) to sell the property.
Clarke’s Cottage, Dorset
Clarke’s Cottage, Rimpton, near Sherborne, Dorset
# 1954: £3,500
# 1986: £60,000
# 2007: £595,000, through Jackson- Stops & Staff (01935 810141)
Returning to Britain to retire after a career working with the British Council, William Brook and his wife Dorothy paid £60,000 for Clarke’s Cottage, a four-bedroom dwelling formed from three 17th-century agricultural workers’ cottages. They then spent £30,000 refurbishing the cottage, which included repairing the roof and shoring up the walls. If it seemed a lot to spend at the time, it was a big step up on the £3,500 which had been paid for the cottage in 1954. Now widowed, Dorothy is selling up to be nearer her son, Peter, who lives in Kent.
Oak Cottage, Holywell
Oak Cottage, Holywell, Cambridgeshire
# 1959: £4,600 (plus £300 for the field behind the house)
# 1974: valued at £35,000
# 2007: £615,000 (without the field. The field has already been sold in parts for £340,000)
When Adrian Quinney, a chartered surveyor with the Ministry of Agriculture, and his wife Louise relocated with his job from Wolverhampton to Cambridgeshire in 1959, he had become something of an expert at buying and selling property: Oak Cottage was the fifth property he had owned. Nevertheless, the estate agent who sold it to him felt it necessary to give him some friendly advice. “Behind the house was a field which I insisted on buying with the property for £300,” says Mr Quinney, 87. “He took me aside and said, as a chartered surveyor to a chartered surveyor, I should be aware I was moving to a cheaper part of the country and that I was paying a ridiculous price for the field. I said, ‘Well, you’ve found your lunatic.’ I have since sold off the field to neighbouring properties for a total of £340,000.”
Today’s civil servants, many of whom can only dream of owning a £600,000 house, may wonder whether they would have been better off being born a couple of generations earlier. In 1959 Mr Quinney was earning £2,000 a year (£30,000 in today’s money). And yet he afforded £4,600 without taking out a mortgage. “I don’t believe in them,” he says.
Now Mr Quinney and his wife have decided to downsize to a bungalow in the local area and are selling Oak Cottage through Carter Jonas for £615,000. Anyone moving from Wolverhampton nowadays will not find the property cheap: Holywell, 15 miles from Cambridge, has come up in the world, thanks to the cluster of technological businesses in the area and the easy commute to London.
South Lodge, Mark Cross, near Wadhurst, East Sussex
# 1971: £7,000
# 2007: £435,000 (through Humberts 01892 782424)
South Lodge was built in the 1930s to house workers from the Houndsell Estate. When the estate was broken up in the early 1970s, the three-bedroom property made a good home for Adrian and Sheila Beetlestone and their two daughters. Previously, they had lived in a semi-detached new house in Hadlow, Kent, which they had bought four years earlier for £4,000. The proceeds from the sale of this just about covered the purchase of South Lodge. Now aged 69 and 67, Mr and Mrs Beetlestone have decided to move to Tunbridge Wells. “We never imagined in 1971 that we would be selling our home for £435,000, but sadly, of course, we still need to live somewhere, and we are buying in Tunbridge Wells, one of the most expensive towns in the country.”
# Report by Brian Geavis
Price rises by region
£10,000 put in property in 1977 would now be worth:
Greater London: £180,211
South East: £161,844
South West: £161,340
East Anglia: £151,340
North West: £149,838
East Midlands: £144,607
N Ireland: £142,311
West Midlands: £136,437
Yorks & Humberside: £118,336
Average uk house price
# 1977: £12,835
# 1979: £18,402
# 1981: £24,543
# 1983: £27,208
# 1985: £34,338
# 1987: £42,283
# 1989: £61,575
# 1991: £56,417
# 1993: £51,846
# 1995: £52,835
# 1997: £57,724
# 1999: £69,791
# 2001: £86,855
# 2003: £124,050
# 2005: £158,029
# 2007: £181,574
one note re: california property tax.
they’re not deductible. but they’re skewed.
remember, thanks to prop 13 (decades ago) the amount of property tax you pay is set when you purchase the house and remains constant as long as you remain in the home (unless you do a significant reno.) so if you’ve been living in your home for, say, 23 years, you may be paying $200/year in taxes (set based on rates in 1984) while your neighbour, who just moved in to a similar-sized home next door, is paying $10,000/year. (taxes based on today’s selling price.)
just another quirk of the california system.
Hey Domus, take a look at the same time last year, sell/list 59% for the same week: http://rireb.blogspot.com/2006_07_09_archive.html
great read over at Mohican’s blog.
A little snippet;
Given the deterioration in underwriting standards, models predicated on prior experience have little value when compared to the data of the last two or three years. In essence, one is assuming a normal distribution curve of data for modeling purposes, while in reality you have data that comes from a highly skewed distribution. We are beginning to see the negative effects of flawed modeling by the growing number of downgrades in the sub-prime sector. This trend is also starting to develop in the Alt-A sector as well. We believe these trends will continue to unfold over the next two or three years and should lead to a retrenchment in the securitization/origination industry. If our assessment is reasonably correct, mortgage credit availability will likely contract and, therefore, exacerbate the housing contraction and its effects upon the general economy. We disagree with the opinion expressed by our esteemed Federal Reserve Chairman Bernanke, when he said in his speech of May 17, 2007 at Chicago’s 43rd annual conference on Bank Structures and Competition, “We believe the effect of the troubles in the sub-prime sector on the broader housing market will likely be limited, and we do not expect significant spillovers from the sub-prime market to the rest of the economy or to the financial system.” We will see if this optimistic assessment proves to be the correct one.
“I know I will be eaten alive for this…..but could it be the start of a rush for the exits? The past 12 months have seen sellers piling up in many NorthAmerican cities….why not Vancouver? The mountain, the ocean and the Olimpycs????”
You could be right though. I wish all vancouverites could afford to own a piece of land in their own city; but a wish is still a wish!
I start seeing those newly built houses in East van, with larger lot i.e 40′ or more, asking for over a $million while it was only $800k last year.
I guess only some states have deductible property taxes. I know I have relatives in Portland who pay over 10,000 a year in property taxes and they are tax deductible. However an equivalent property here would only be paying about 5,000 a year.
“I start seeing those newly built houses in East van, with larger lot i.e 40′ or more, asking for over a $million while it was only $800k last year.”
Yup, this time last year (When people like Domus where preaching doom, and things had peaked) 33 foot lot value in Kits was ~$800 now it’s ~$1 mil.
Obviously someone is going to buy at the peak and not be happy about it. But I know 6 people who have bought over the last few years and every single one thought they had bought at the peak, now all of them will still be a head even if there’s a 20%-30% drop…
IMHO the interesting thing is what happens next spring.
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