May 19 Week Ending Stats

Overall, SFH MLS listings rose only slightly this past week. Only homes with asking prices less than $300k or more than $700k had an increase in listings. Between $300k and $700k there are fewer listings on MLS this week.

Inventory of homes with asking prices of more than $700k continues to skyrocket. 36.6% of all SFH listings on MLS are in that price range. On the million dollar home front, there are 7 more listings on MLS this week, bringing the total to 184.

Listings of condos and townhomes appear to be flat over the past couple of weeks.

Side notes:
- Through an email service of a local realtor, I received a newsletter this week where the top article was on the "Secrets to making a lowball offer". I had a good snicker.
- How did you like the usual full page ad today in the TC for Tuscany Village? "Priced well below appraised value."

The Best Place to Live

Very interesting. And to think that we all thought that everyone wants to live in Victoria. Well, here's some news, apparently, no one wants to live in Victoria! At least, Victoria is in no ones list of top 5 places to live in the world.

To compare, 5 out of 59 people list Vancouver in their top five places to live. 0 out of the 59 people list Victoria.

This statistic comes from a very statistically accurate source - the comments on Housing Panic's website. Check it out here.

Of course, this is silly. I think most of us Victorians love our city. If we didn't, there certainly wouldn't be much reason to stay!

Spreading the Gospel

Mark 16:15 "... Go into all the world and preach the good news to all creation..."

Is this something that we need to be doing more of? Should we be preaching on the street corner that house prices are too high, that renting is cheaper than buying, that North America's economy is in for a rude awakening? When friends talk about jumping into this market with heavy hearts, I try to tell them that there is no shame in waiting it out. Things will get better. We have to believe that. We have to have faith!

There are many signs out there that things are awry. I love the following sites because they remind me to stay strong.

Irvine Housing Blog's Anatomy of a Credit Bubble

Priced Out Forever's Action Page

Don't Buy Stuff You Can't Afford

Today's housing market is as much out of context as the Scripture above. I do believe that we can have an impact by telling others that high prices and unaffordability are not here to stay. The bottom line is - don't do something foolish out of fear.

May 12 Week Ending Stats

Inventory of single family homes with a listing price of more than $500000 continues to rise much faster than SFH with a listing price of less than $500000. There are 34 more MLS listings for SFH with an asking price of over $500k this week, with 17 of those having a listing price of more than $700k. There are only 2 more SFH listings this week with an asking price of less than $500k.

The number of listings for three bedroom SFH and townhomes continues to rise. Listings for two bedroom condos appears to be all over the map. There has been a large decrease in the last two weeks.

I'm suspecting that this month is shaping up to have a decrease in average price for SFH. The reason being that inventory of high priced homes is building rapidly, while lower priced home inventory is not. Through this, I'm lead to think that homes with sub-$500k prices are selling in higher quantities than home with the higher prices. I could be wrong - I usually am.

April Housing Starts

CMHC has released April statistics for Vancouver Island housing starts. The report can be found here.

Housing starts for Victoria for the year thus far are 15% higher than the January - April period of 2006. April was a big month for Victoria, with 300 new starts, 193 of them being condos in Victoria proper.

"Victoria's under construction volumes have now reached their highest level since September 1976, meaning this generation of builders is experiencing their busiest year ever," said Peggy Prill, Market Analyst at CMHC Victoria.

The Metro Victoria Condo Supply graph is amazing. More than 2000 units under construction! However, the graph shows nearly 0 as inventory. I don't understand that.

Wow, the highest level of home construction in 31 years, more than 2000 condo units under construction. I'm very curious as to what the construction related employment numbers are like for our city. Does anyone have access to this information?

Most of Victoria's large condo developments are due for completion within the next 3 years. As buildings are completed, will new buildings and developments take their place? Are we at a permanently high construction level plateau? If not, what will all the people with construction related jobs do when development slows? I'm guessing that Wendy's and Tim's will have an easier time filling their job vacancies.

Million Dollar Market

In yesterday's post, I commented on how according to estimated numbers, it appears that the housing market is still a seller's market. There were a number of comments on how homes in certain neighbourhoods are sitting for a long time. These homes are high-end homes, with asking prices over $1 million. So, I thought it would be appropriate to calculate the market we are in for million dollar plus homes.

From yesterday's numbers, let's assume that there were 1653 SFH listed in April. I've been tracking the number of SFH listed on MLS for over $1 million for a couple weeks. Yesterday, we had 169 SFH listed with asking prices of $1 million or higher. This represents 15.5% of all SFH listings. 15.5% of April's 1653 SFH listings is 256 listings. According to VREB, 28 SFH sold for over $1000000 in April. This gives us 9.1 months of inventory for SFH priced over $1000000.That is definitely a buyer's market!

Attention! Everyone in the market for buying a $1 million dollar home - name your price to the seller, because their home is going to be sitting for a long time! Everyone selling a million dollar plus home, you'd better be sharpening your pencil if you truly want to sell your house!

And yes, the asking price for this home is $1.15 million. There are almost 5 acres, but seriously! Get real!

May 5 Week Ending Stats

63.2% of all single family homes listed today for Greater Victoria on MLS.ca have an asking price of $500000 or higher. 14.4% of SFH are listed for $400000 or less.

The number of listings for SFH priced above $500k continues to rise faster than SFH listed under $500k.

I'm trying to wrap my head around some stats based on April's numbers and today's SFH "asking price" dollar range percentages. The median selling price for SFH in April was $489000. Therefore, more that 50% of SFH sold for less than $500k, less than 50% of SFH sold for more than $500k. Based on the number of listings on MLS today, 36.8% of SFH have an asking price of <= $500k, 63.2% of SFH have an asking price of >=$500k.

Some of the following numbers are estimates, but I think the general idea will come across. Based on my calculations, approximately 50% of the listings for Greater Victoria on MLS are SFH. According to VREB, there were 3305 active listings in April. Let's assume then that 50% of the active listings were SFH, 1653.

Using today's MLS percentage numbers, if there were 1653 SFH listed in April, 36.8% will have been listed for under $500k. This gives us 608 SFH under $500k. 63.2% will have been listed for over $500k. This gives us 1045.

467 SFH were sold in April. The median was $489000. More than 233.5 SFH sold for less than $500k, less than 233.5 SFH sold for more than $500k. For simplicity, I'll use those numbers. SFH under $500k, 233.5 sales, 608 listings, this equals 2.6 months of inventory. SFH over $500k, 233.5 sales, 1045 listings, this equals 4.5 months of inventory.

What does this all point to? Price compression? Sputtering upper-end? A seller's market? Perhaps a number of things. A quick search on the web regarding months-of-inventory and 6.0 came up as the MOI switching point between seller's and buyer's markets. This leads me to believe that based on April's numbers, Victoria's Real Estate market is still a seller's market, with homes priced under $500k very much favouring sellers. Homes prices over $500k are moving closer to a buyer's market, but not yet there.

Spring is a busy selling season. The MOI should move closer to a buyer's market over the summer. However, for a major shift, we will need significantly more listings and / or fewer sales.

Analysis of April's Sales Numbers

I've stopped sulking and am ready to take a look at the numbers presented by the VREB for April sales.

SFH hit a record high for average sales price. $568,710 - that's a chunk of change. In fact, if you were to buy that average home with loonies, it would take 3981 kilograms of loonies! There were 28 sales of $1 million+ SFH. The VREB's prez had the decency to mention that this skews the average. Quick calculation - if the 28 high-priced SFH that sold for $1 million each (which they didn't) were taken out of the SFH average, the new average would be $541201. That's just below last months average. Average selling price in each region other than Saanich West and Central Saanich was higher than the rolling six month average. The number of sales for April was higher than last year, but lower than April 2005.

Median sales price for SFH for Victoria proper was higher than last month, however, median sales price for the CRD was lower than last month by $1000.

The average sales price for condos in April just squeaked in higher than the six month rolling average. The sale of 15 waterfront condos helped pull the average higher. Number of sales was strong in comparison to April last year - 238 in 2007 vs. 188 in 2006.

There were more townhomes sold this April than last April as well. Average selling price was marginally higher than the six month rolling average.

Regarding active listings, the number is getting higher and higher. There were approx 700 more listings this April than last - a 25% increase. We are about 150 listings less than the peak last September. May 2006 was a big listings month. If May 2007 is also a big listings month, we'll smash through last years' record listings no problem.

In looking at the numbers more closely, they aren't as strong as I had originally thought. However, I was surprised at the quantity of sales. I admit, I spend way too much time on MLS. I see the same houses each day. That is a bit of an exaggeration, but, based on that, I thought there was going to be a low sales number. I'm guessing that houses that sell, sell fast. Houses that don't sell, sit there a long time.

The Bears have yet to score a point this year. The Bulls have kicked another field gold. The score is now Bulls 16, Bears 0. Hopefully we get a game out of this one. The real $64000 question is whether the Canucks can give us a game to cheer about!

April Sales Numbers

VREB has released the April sales numbers for Greater Victoria. Here is the link to the sales stats page. Sales are up, prices are up. More to follow. I need time to process the stats and my stance as a bear.

CMHC "Housing Now" Report for March

CMHC released the March edition of "Housing Now" for Victoria today. It can be found here.

Items of note:

• Housing starts year to date are nearly equal for 2006 and 2007.


• Units under construction year to date are way up for 2007. Most notably, condos are up 55.3%.


• Units completed and not absorbed are up 35% year to date.


• Months of inventory based on March 2007 numbers - SFH 2.22, townhomes 2.87, condos 3.12

I'd disregard the months of inventory for condos, as so many condo developments do not have their units listed on MLS. Based on the CMHC numbers given, the March MOI for SFH and TH are quite low. However, I'm confused with their numbers. A quick sum of the CMHC active listings for March equals 1827. VREB states that active listings for March were 3079. What gives?