Monday listings were 267, while sales were 134. Sell/List was 50.19%
Inventory right now is 11,833. Over 90s are 2863 (24.20%)
Rob asks: will inventory drop at months end? 🙂
Filed under Daily Numbers
Could you also post the sale-over-list numbers as well? Thanks
Yes, Yes, Yes!:))
Awesome, just awesome. The trend continues.
Thanks for the data Rob/Chan.
Yes, inventory will drop, for about a week to 10 days – then ramp up for a month – then drop into Jan – then ramp way way way up – jmho.
We have a sales to list differential of 133 and the inventory DROPS 7. That’s an awful lot of expiries. That’s been the same for most of this month. Inventory is just treading water right now it seems which I guess is impressive with the large number of expiries.
As BBY suggest in a previous thread, there is a lot of hidden new condo inventory. How much is anyone’s guess.
Ya – Rob – do you think these expiries will re-list (clearly the expiries are outpacing listings, so this is a net loss of existing listings not cleared by sales – therefore a lot of people testing the market?).
Anon – for what it’s worth – my westside realtor friend says the craziness is definitely gone and stuff is now going under list. Would be very cool to see some stats, though.
rentingsucks: for what it’s worth, it’s the end of the month now, and it’s typical for expiries to spike around this time– expect a lot of expiries for the next two or three days.
It’s also typical for listings to peter out until a few months into the new year, so expect sales+cancellations to outstrip listings starting mid-November.
People are waiting. Still nurturing hope it’s not a start of deflation .. once the hope is invalidated, the listings will go up. As others pointed out, it is likely to be a wave-shaped graph, with each spike climbing higher as more owners will be reaching their risk tolerance levels. First major spike is likely to be in February, that’s to allow potential buyers to somewhat recover from Christmas spending frenzy. IMO listing before, on or shortly after Christmas does not make much sense, as buyers have other priorities.
I think that as the market changes (can you say “softens” when we’re still getting the prices we are?) seller perspecticves will change. Sellers who listed based on achieving a certain price will probably be less inclined to disbelieve their listing agent. If their only motivation was price, or if price was the dominant one (if I can x for this, I can pay Y for that), I think that fewer expiries will re-list.
Of course, if Y becomes y – 10%, then the X can also be reduced. Can it be reduced the same amount? Do the math:
House X is listed for $100,000. Seller 1 bought for $50,000 and had a $25,000 mortgage.
Seller 1 wants house Y, which is listed at $125,000. He still needs more money to buy ($25k original dp, $50k equity, $25k original mortgage, plus an additional $25k from somewhere). In other words, he can increase his mortgage by 100%.
If house Y falls to $112,500, and house X falls to $90,000, Seller 1 needs the original DP of $25k, his original mortgage of $25k, his increased equity of $40k, plus…another $22,500. Hence the rule that you can buy up more cheaply, all things being equal, in a falling market (the 10% is bigger, in absolute numbers, on the bigger ticket item).
The reverse holds true in a rising market, so you should really buy the bigger house first, then sell the smaller house, assuming you know the market will rise. Stressful? Yes. But what would be scarier? Buying two houses in a market you were confident was rising, or buying up in a market you feared was falling? Its that kind of Hobson’s choice that makes moves with the principal residence so hard on the principals. You really have to factor in the intangibles (how much do you want the house, what is the family doing (new kids, empty nest, divorce), what is going on on the income front, etc).
Yup, agree with your comments Rob. It becomes relative, once you are an owner (to some degree at least).
Question – are you seeing more/less/the same in terms of folks buying a place and then listing theirs (ie. running the risk of carrying two mtgs until home 1 sells)?
Are you seeing signs of softening – if so, what do they look like (ie. how/where are you seeing it).
I have been looking at your site for some time now. I think you are being quite capricious with your observations about the current RE market.
If it suits you, that is.
For example, awhile ago, you tried to “make a case” for fundamentals backing this market.
NOW, you seem to be changing your tune. Which is it?
I would advise you to Google the “Charles Hugh Smith” blogsite. He seems to have realtors like yourself in mind in his blog today.
Here is a cut n’ paste from calculated risk (http://calculatedrisk.blogspot.com) that is topical to the last few postings (note that he is referring to the bubble south of the border):
“Even though the current housing bubble is probably the largest ever, both in price terms (relative to fundamentals) and geographically (the bubble was widespread), the bust is still following the normal pattern.
A typical housing bubble does not “pop”, rather prices decline slowly, in real terms, over several years. This is because house prices display strong persistence and are sticky downward. Sellers tend to want a price close to recent sales in their neighborhood, and buyers, sensing prices are declining, will wait for even lower prices.
This means real estate markets do not clear immediately, and what we initially observe is a drop in transaction volumes, followed some time later by price declines….”
However, since few people predicted the extent of this bubble in the first place, why should anyone believe it will be a slow leak?
As a matter of fact, WHAT is believable anymore about the entire RE industry?
Just remember, like any other fad, “Whatever comes in fast, goes out fast”.
The same may be true for the coming collapse.
can anyone state how Oct 07 compares to Oct 06 ?
I think you’re confused. Can you point to a post where I made a case for fundamentals backing this market? Are you sure I wasn’t just throwing out a topic for discussion, as opposed to actually justifying current prices based on fundamentals?
The reason I ask is because I believe in some fairly strict metrics, and I also take issue with what some people refer to as fundamentals. Recommending a buy is not the same thing as not agreeing with a particular bear.
I don’t think I’ve changed on any basic level. I’ve always said the market will change (it always does), and that to prosper you should buy according to certain principles. I’ve speculated whether inter-generational wealth could change some of the metrics (I haven’t argued that they will) and I’ve certainly disagreed with many bears that the market is facing an imminent collapse (to be fair, unless you treat “imminent” in fairly elastic terms, many of those people have been wrong). And, of course, I’ve always said that the cure for high prices is high prices.
Anyway, what I’m most interested in is when I made a case that fundamentals justified current prices. I’ve taken a quick look back. I wrote this 6 months ago. Do you see a big change?
You can also check out posts on the old blog (there’s a link to it on the right) – I’ve got some posts about fundamentals from last year. You find my argument and I’ll be happy to try to square the circle. All the posts are still up where you can see them.
You can look at my old blog http://rireb.blogspot.com/2006_10_29_archive.html to get an idea.
I still think this bears scrutiny.
You need to be VERY careful with what you say even though this is your own blog site. Otherwise, you will lack the credibility you require in order to stay in business.
Rob, thanks. Was hoping someone would have a months view ? looking at your old blog, Oct 07 just looks very similar to Oct 06, but with slightly less inventory !
Rob: “And, of course, I’ve always said that the cure for high prices is high prices. ”
Here’s what you wrote on October 4th, 2007 at 11:43 am
I guess my question is: if high prices are the cure for high prices, can’t there just be a plateau? If $100 is the absolute top, and I bought yestarday for $99.50, and prices have stopped rising, will I sell at a loss if I can continue to hold? That’s why I think we need an additional event of some sort.
So which is it, Rob? High prices are the cure for high prices, or we need an additional event?
What exactly does that mean? Did I try to make a case for fundamentals backing this market or not? Is it possible that you aren’t remembering accurately? (BTW, did you know that you and Snick share the same IP address and provider?)
My problem is that I don’t see change as being restricted to either continued appreciation or a 180 change to decline. Throw in real versus nominal gains (or varying rates of increase or decline) and its more complex. We could have a nominal plateau, but real losses, for example.
The cliche is still valuable, I think, because it lets me state clearly that I recognize price growth can’t continue indefinitely without having to buy into the lastest bear argument (which sometimes don’t have much merit).
Prices can only go so high. They can plateau in nominal terms and decline in real terms. We’ve seen that happen before. High prices can cure high prices by curtailing price growth (and I’m not predicting that this will happen – I don’t know what the future holds). My point with the additional event requirement (and we could easily have one) is that there is more than one outcome possible. A halt in price growth does not have to equal a crash where sellers rush to liquidate at a loss (a relatively common prediction that doesn’t stand up to much scrutiny).
That said, is thinking that we need more than a halt in price growth to create a correction the same as saying that this market is underpinned by solid fundamentals?
“First major spike is likely to be in February, that’s to allow potential buyers to somewhat recover from Christmas spending frenzy.”
I don’t buy that, recovery time from spending a few hundred bucks or even a grand or two? I can’t imagine things being that pathetic.
Rob, I appreciate the effort you’ve put into your blog. I’ve been following your blogs close to a year; and it’s been interesting to watch the numbers.
Northern Ally, Wiseguy, others: don’t prosecute Rob, he puts up his numbers and makes some comments. Can’t you leave it at that ? If you don’t have anything useful to add to the conversation, take it elsewhere.
macchiato: I’m not saying things are going to be this pathetic. Xmas is a spending season, and some potential buyers will delay *all* further purchases because of that. It’s irrational behavior, but it does exists. So I am just assuming that some sellers will still be accounting for it and delaying listings until February … though it’d be nice to hear from Rob or anyone else in RE business, if there is in fact an annual dip in listings around January time. Rob ?
As (easily) predicted Harper et. al are buying your vote with your own money.
GST reduction, personal IT reduction, corporate tax rate drops…all bullish. An when the US fed drops their overnight rate by 1/4 of % today, the BOC will have to follow suit so the $CAD doesn’t kill everything but oil, gold and Air Canada in this country. And yet so much US bad news on house prices…its a fundamentals vs fear de mental cage match. I have no idea how this will play out over the next year, so i sit on my Gold, Oil and Air Canada stock 🙂
BoC will not drop rates unless inflation declines, it rose last month 2.5%. Employment at a record 5.9% economy firing on all cylinders. Even people who have been laid off in the manufacturing industry are finding work in other industries.
BoC has stated that interest rates will remain pat through 2008 and has stated that they do not make their decisions solely based on one industry (like manufacturing) unless it had a bottomline effect on the rest of Canada’s economy.
Federal government has also added some stimulus to the economy by its tax cuts, another reason that interest rates may not drop anytime soon.
Mortgages rates are set by the bond rates anyhow and will go up or down independently of BoC rate decisions.
High oil prices fuel inflation. High dollar calms inflation.
Oil prices spiked back up today $93.79. Owning Air Canada stock when fuel costs are rising is okay until Air Canada’s fuel hedging runs out or load factors decrease. Russian roulette, be careful.
Wise Guy said:
“However, since few people predicted the extent of this bubble in the first place, why should anyone believe it will be a slow leak?”
Wise Guy, Calculated Risk successfully predicted the collapse of the real estate bubble in the US and the timing of the collapse as well. He also predicted the market sell off in August with “spooky” accuracy.
(Formerly?) Red hot Strathcona: MLS V676271
1/2 duplex 2BD 2Bath, half a block from Bennie’s. This went on the market about a month ago at $529,000, reduced a couple weeks later to $499,900, now $474,900.
hatemyLandlord: I think I had a legitimate cause to ask Rob for clarification of a previous comment he made, and he had the grace to make a detailed response. As for you, what have you contributed except accusing others of persecuting Rob for simply questioning or disagreeing with what he has said on a public forum?
l Msg. to “hateMyLandlord”
This is your October 31 Horoscope for RE Bears
Real Estate prices are going up and you are renting and have nothing to show for it. By not getting on the bandwagon, you not only disappointed yourself but disappointed your family and friends. And while prices go up, expect your rent to increase also. Take action now. Tarda venientibus ossa – says the Latin proverb (late-comers to the meal get the bones)
But renters take heart. The government will partially subsidize your rent if it exceeds a certain percentage of your gross income. And if you need a second job to maintain your renters’ lifestyle you can offer to clean apartment/condos registered under Chipman and Sons in the Land Title Office.
Bank of Canada injects another $610 million into market today to lower the overnight interest rate toward the central bank’s target and improve liquidity.
Dollar trades 105.15
I find it amusing that people who own real estate think a person that rents has nothing to show for. Unless you have access to a renters bank statement, how would you know that.
You can assume one that owns property may be further ahead, but that may not be necesarily so. One can take out a 40 year mortgage with zero down, while the renter saves and purchases on a dip with a larger down payment. Sure there could be a slight price increase, but the renter will be paying a lot less interest over time than the person who bought with nothing down.
Most renters become buyers, so they might have cash.
If you read the peer-reviewed literature, over the long term renting plus investing wins out financially. eg, a Canadian (UBC) study I saw said the cut-off was about 80%, ie, just put in 80% of the difference between your housing payments and rent into stock indices and in the long-haul you break even with ownership.
“Real Estate prices are going up and you are renting and have nothing to show for it.” Yeah, right.
Everyday the sell/list ratio is less than one still the inventory stay the same. What gives ?.
No sweat in terms of asking the question and allowing me to answer. It’s a complex subject and nobody can do it justice in a few sentences, so we all need the opportunity to re-state our views if we don’t communicate them well.
Re-read Popeye. He’s not pro-ownership and anti-renter. He’s being funny.
Are you just trying to be funny? Or…stating your actual viewpoint in a funny way?
I think your other thread on 50% values, has stopped posting more comments for some reason. I posted a comment, it didn’t appear and when I went to post it again it said it was duplicate, but still has not appeared on the thread. Strange.
Here’s some scary Haloween facts.
My neighbour in Grandview sold his house in 2 days. Got an astronomical price for it. My friend won another property in the same neighbourhood last weekend by bidding war. There were 103 parties viewing the open house and 5 parties bidding the price up from $600K to $650. Every over-priced property on the West side we look at and hang back on goes for asking, over asking or close to asking. Even if they hang on the market for weeks/months.
Whatever the sales/list ratio says the market is doing is not happening in the core areas of Vancouver West/Vancouver East. My bet is spring prices will go even higher than this fall. My prediction after reading this site and watching the market like a hawk is that there will be no meaningful price correction for some time yet.
Last fall the market took a breather and I had 3 friends who moved up in that period. I thought they were crazy but it turns out they were right!
I’ve been monitoring detached houses mostly in Kits and see the same thing. In fact last year during the fall ‘slump’ things seemed to sit on the market longer than now.
Apparently, I’m not as wealthy as some people here. Although, we’re saving one thousand dollars a month on a sixty thousand/year family income. Spouse is working part-time/studying part-time, and my job (the main job) is at an American company so I fear the high Canadian dollar/low American dollar.
The markets I’m watching are pretty dead. New Westminster, older parts of Coquitlam, Port Moody, etc. Relatively affordable condos and townhouses, maybe even the odd “cheap” house with a suite. Realistically, though, we need to stay below $300,000.
Although there are some sales of the units I’m watching, the prices aren’t budging up or down. They are going for about the same as last fall. If I had bought last year, I would have been lucky to get 5% appreciation (not even enough to cover the costs).
Maybe things are still hot in the rich areas of Vancouver, but out here, in the housing for us working slobs, its cool, very cool.
I’m a working slob, Priced Out. I just got lucky by buying in the fall of 2001. I want to be lucky or smart twice, though.
I know the market will correct and I want to change properties when that happens. But this little doggy is getting fed up waiting and seeing dumps sell in the gazillions.
If you’re not going to move and like what you buy and find something in New West at or under $300K, then why not go for it in the next year or so?
U.S. Fed cuts by quarter-point, says that may be enough
“Fed explained that it believes the risks of a sharp slowdown are roughly in balance with the risk of higher inflation.”
Oil trading at $94.57 another record high
Canadian dollar trading at 105.97
How high will it go?
Gold trading at 798.00
Fraser Valley sales are like watching paint dry. Seems certain areas of Vancouver are much hotter sales wise than other areas. Probably the reason you have people saying sales are slow, prices are falling, sales are fast, prices are going up. A real mixed bag, depending on where you live.
Canadian dollar breaks through 106.
coco: AC has a very new fleet. Relatively fuel efficient. But i’m selling them anyway…I just got back an hour ago from the center of the universe (Toronto) and on the way back i didn’t even get a bag of pretzels. Luckily I stole some chips and a tiny box of musilix from the lounge, otherwise i would have been DOA.
$CAD: unless BOC adjusts, 1.1 by next week.
vomiting dog, we have a decent place with affordable rent. Considering we can save $1000/month and appreciation is negligible in the places we are looking at, why rush? We’ll wait for the crash and probably save about a hundred thousand dollars.
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