Canada's Housing Bubble

Jan 17, 2010 Glenn Sergius Mesich Media

Sale/List suffered a record drop from 182% to 29% in Greater Vancouver

The Greater Vancouver housing market is displaying mixed trends right now.  Mixed tendencies can sometimes be the forewarning of change and a response to new market interference.

The number of new listings are greater now than they have been in more than a month.  This is a big change.

Sales numbers however have not substantially changed from last week.  Sales remain slower now than they were in early December.

This may indicate the buyer’s desire for more choices and different choices. What has been offered for sale is not what people have wanted to buy or, the prices are too high.  Now that buyers have more choices sales may jump in the next week. If attached home prices continue in the four week trend of decreases this could be the beginning of the end of a bubble for attached homes.

The story of detached homes is different. Prices of detached homes continue to increase.  Sales are steady.

Profiles of buyers for attached and detached homes differ in terms of age, finances, and requirements.  How they view the world also differs.  A variety of events impact real estate sales. Natural disasters such as the earth quakes in Haiti that dominate the news can interrupt the focus on property purchase. It is possible the disaster in Haiti is a new factor impacting real estate sales market by slowing it down as people concentrate on this news rather than shopping.

Sometimes one section of the market is impacted more than another.  Younger purchasers are sometimes less well financed, and first time home owners, are more common in the attached home sector.  This purchaser sometimes responds more quickly to price ceilings. It may be that the attached market simply reached a price ceiling before the detached market.

Sales are generally slower in January and pick up as the months move on. If all sales hesitate it could mean the mad frenzy of real estate is entering calmer waters.

Look at the following information. Courtesy of Agent Will

More reading:

Bears Prematurely come out of Hibernation

On Nov 11, 2009 Richmond BC realtor James Wong said: "This may be the best time to sell when others are buying. If everyone is thinking of selling, it may be too late. Home prices can easily fall 15% to 20% when market sentiment turns, and home sellers are rushing to sell."

Click here to read James Wong's "Real estate lost decade?"