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There Was Jubilation, Then Shock

A report from the Langley Advance in Canada. “Langley homebuyers looking for a house, condo, or townhouse have a huge increase in their options compared to a year ago, according to he Fraser Valley Real Estate Board. In September, there were 428 single family homes for sale in the Langleys. That’s up 7.5 per cent from August, and a 45.1 per cent increase from the 295 that were on the market in September 2017.”

“The increase was much steeper for townhouses and condos. There were 263 townhouses on the market in September this year, up 15.9 per cent from August, and up 189 per cent from the 91 townhouses that were for sale in September 2017.”

“Condo buyers could choose from 261 listed dwellings in Langley, up 13.5 per cent from August, and 230.4 per cent from the 79 on sale in September last year.”

“The increase in housing inventory has been building up for months, as sales dropped off sharply. Just 71 houses sold in September, 40 townhouses, and 61 condo units. Despite the big swings in sales and inventory, Langley realtor Deanna Horn said this isn’t a housing correction, just a return to normal.”

“‘We had for the last 18 months or two years, we had a very, very exceptional market,’ Horn said. That gave rise to the sharp price increases of 2016 and 2017, Horn said. ‘We’re moving into a normal inventory level,’ she said.”

The Squamish Chief. “Just 508 single-family homes traded hands across Metro Vancouver in September, which is a 40.4 per cent drop from one year previously, and down 11 per cent from August. The benchmark price for detached properties is $1,540,900, which is a 4.5 per cent decrease from September 2017 and a drop of 3.4 per cent in three months.”

“After many months of market activity deeply divided by property type, townhomes and condos seem to be finally succumbing to the sales slowdown that has dogged the detached home sector over the past year or so. Townhome activity saw the biggest annual slump, with a mere 275 sales in September, which is a whopping 46.9 per cent lower than September 2017, and a slide of more than 18 per cent from August.”

“After a long reign as the most resilient sector, condos are now suffering a similar fate, with a 44 per cent annual drop in sales, at 812 units in September. That’s the steepest month-over-month activity decline, down more than 20 per cent from August’s condo sales. Benchmark prices have also continued to fall off the peak seen in the spring for this home type.”

“Although Whistler is leading the pack for single-family home prices, it was the only area in the Greater Vancouver board’s jurisdiction to see an annual price decline in its condo market, with the benchmark price one per cent lower than a year ago and an eyebrow-raising 10.1 per cent lower than its peak price earlier this year.”

“Vancouver West didn’t do much better, with condo prices up only one per cent since last September, and down 5.6 per cent in the past three months. Squamish benchmark condo prices are 3.4 per cent higher than a year ago, but a full nine per cent off their peak in spring this year.”

The Kelowna Daily Courier. “A bouncing ball is the best way to describe the average selling price of a single-family home in Kelowna. In July, the average was a record-high $782,400. There was jubilation. And people who owned their own homes simply felt richer.”

“Then in August, shock, as the average plunged $95,000 to $687,400. Homeowners felt instantly poorer and the explanations piled up. It’s confounding as sales continue soft, impacted by a mix of tougher mortgage rules, higher interest rates, a correction in the integral Vancouver market and consumers adopting a wait-and-see stance.”

“‘Houses are sitting on the market for longer, so it’s likely only a matter of time before we start to see (more) downward pressure on price,’ said Okanagan Mainline Real Estate Board president Marv Beer. ‘More supply means buyers have more choice and, as a result, tend to become more discerning.'”

From CBC News. “Regina’s realtors association attributed a dip in local housing numbers in part to mortgage rules designed to cool off other housing markets across Canada. Gord Archibald, CEO of the Association of Regina Realtors, said the new rules have been applied to markets across the country — whether they need them or not.”

“‘The rules should be applied on a regional basis where needed, not with a broad brush across all Canadian Markets,’ Archibald said. ‘As a result many local buyers have been unnecessarily put on the sidelines.'”

“A drop in prices which started in September 2013 continued, with the average home being listed at $277,000, down from $290,700 from 2017. The average home was listed at $303,700 in September 2013.”

From Global News. “Housing prices in Saskatoon remained flat for the most part in September. Sales continue to remain off for the year as Saskatoon remains a buyers’ market.”

“‘It seems that sellers who are not highly motivated are choosing to wait until conditions are more favourable to sell,’ said Saskatoon Region Association of Realtors CEO Jason Yochim. ‘Currently we are in a buyers’ market with elevated levels of inventory and downward trending prices for most properties.'”

The St Albert Gazette. “The housing market continues to burn hot for the buyer, but sales are lagging behind. ‘There’s not a lot going on; it’s still pretty much steady as she goes,’ said Darcy Torhjelm, chair of the Realtors Association.”

“In September there were 8,969 homes for sale across the Edmonton metro region, a decrease from July and August when a record of over 10,000 homes were up for sale. Torhjelm said the drop, however, was mostly attributed to sellers finally taking their houses off the market as opposed to homes actually selling.”

“Torhjelm said he believed the hesitancy to buy stems from a continued lack of confidence in the economy. ‘There’s still some concern about the economy, no sense of urgency for the buyers,’ he said.”

“In , single-family sales dropped year over year by 9.52 per cent, while prices jumped 7.5 per cent year over year to $495,569 this September. While it may seem odd that prices would increase when homes are struggling to sell, Torhjelm said it’s a reflection of a steady market. He added that higher-priced properties have sold, which increases the overall average price of the market.”

“Condo sales in St. Albert, on the other hand, increased by 33.3 per cent from September last year to September this year, while the average price of a condo plummeted by 23.2 per cent to $254,248. The drop in sales could be attributed to some of the less-expensive homes selling, Torhjelm said.”

“When it comes to the rest of the year, Torhjelm said he expects the market to remain relatively unchanged. ‘You’re going to have to be really sharp when you’re trying to sell your property,’ he said.”

This Post Has 15 Comments
  1. What a great name: Marv Beer.

    One thing that’s unfortunate about this hyper active US market is I’ve had less time for these Canadian towns and cities I’ve come to know so well – even without visiting. I’ve been posting links to the Squamish Chief for well over a decade.

      1. What was that Benny Hill theme song? Yakity Sax? Would fun to drive around a neighborhood with that theme music playing to all the FBers.

  2. Vancouver Real Estate September Sales Drop 41%- Negative Sentiment is Accelerating

    Steve Saretsky
    Published on Oct 6, 2018

    https://www.youtube.com/watch?v=iCoJ78LLg-s

    The Vancouver real estate market is going through a psychological shift. Buyers are becoming more hesitant to pull the trigger in a belief that prices will drop in the months ahead. And those thoughts are certainly justified. Vancouver detached sales once again trickled in at a 27 year low for the month. There is now 15 months of inventory for sale in the detached space. This has now spread to the condo market where sales fell 42% and inventory jumped 73%. Inventory is still low historically but it is climbing rather quickly. Further, there will be a record 2200 pre sale units released in October, a record high for the month. From a Canadian economic perspective, the housing slowdown is now hitting the auto market, where car sales dropped 7%, the largest Y/Y decline since 2009. The Bank of Canada seems slated to raise rates again in October, while the 5 year Government bond hit a 7 year high this week.

    1. From the comments:

      Josh
      Toronto houses/ apartments prices are up

      Michael M

      I have no idea what you are looking at, perhaps last years data. My relatives and business associate have all given me information where prices are being reduced. I highly suggest you follow KTmoney on twitter. He gives many examples each week of prices being reduced significantly. He shows pictures of the house with the original price and dates when they were bought and sold. I can only assume with your bogus information, that you are a real estate agent.

      ElectronicWasteland

      There’s a definitely a lot of fear creeping in for recent home buyers. I’m hearing a few of my coworkers complain about what other condos in their building are being liquidated for. Buyer’s remorse is on the rise. Whether or not this negative trend translates into a collapse, and how big the collapse is, are the big questions right now. One thing is for certain, it was the biggest buying mania Vancouver has ever seen, so any unraveling will likely be a big one.

    2. One thing that they did in Vancouver was to change the tax system to make it harder/more expensive for foreign buyers. So that appears to be working! In the end it is societies interest for housing to be affordable.

    3. Anytime people start to make comparisons to the last housing bubble is good. Lets not get more people into trouble by buying at high purchase prices.

      [from Seattle Bubble Blog]
      “This is a fairly arbitrary measure, but it jumped out to me when I was looking at the chart of yearly home prices in yesterday’s NWMLS post. Between May and September this year, the median sale price of single-family homes in King County has fallen 8.0 percent. Most years home prices rise between May and September. The biggest decline between those months in previous years was 5.7 percent in 2008.”

      “Closed sales fell 23 percent between August and September. Last year over the same period closed sales dropped 10 percent. Year-over-year closed sales were down 27 percent—the largest drop since November 2010.”

  3. Oh no…this news comes shortly after Janet Yellen assured us that no more financial crashes would happen again, ever…
    ————————————–
    Banking
    World economy at risk of another financial crash, says IMF

    Debt is above 2008 level and failure to reform banking system could trigger crisis

    Phillip Inman

    Wed 3 Oct 2018 10.00 EDT
    Last modified on Wed 3 Oct 2018 15.30 EDT

    The floor of the New York stock exchange in September 2008.

    The world economy is at risk of another financial meltdown, following the failure of governments and regulators to push through all the reforms needed to protect the system from reckless behaviour, the International Monetary Fund has warned.

    With global debt levels well above those at the time of the last crash in 2008, the risk remains that unregulated parts of the financial system could trigger a global panic, the Washington-based lender of last resort said.

    https://www.theguardian.com/business/2018/oct/03/world-economy-at-risk-of-another-financial-crash-says-imf

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