Towards a Balanced Market?
Various recent housing market reports have been the topic of discussion in the Vancouver Sun in late September. All seem to agree that prices are leveling (the headline stated "price hikes have tapered off") and also the obvious, that the number of sales for the past few months are down from the same months last year.
The best analytical comments came from Cameron Muir of Canada Mortgage and Housing Corp and addressed the question of a "balanced" market. He felt that we still have too low an average inventory (supply) relative to the demand that continues to exist. While he is referring to Greater Vancouver, the argument applies equally to our North Shore. His thought is that this balance (Vancouver-wide) could arrive "sometime in 2007". My 2 cents; the stronger (higher socio-economic) nature of the North Shore could lead to our region being slower to attain this "balance". To put it another way, our supply (inventory of homes for sale) may need to rise fairly significantly to satisfy the strength of demand (or those who wish to live here). This supply can only come from two sources; i) new construction and ii) those selling and moving off the North Shore. New supply is slowing down (a significant proportion of current construction is already pre-sold). One conclusion: Is the North Shore still a good investment? You bet it is!
Number of N/Van detached sales down (-2%) year over year. Average prices +15% and inventory up 11% over last year. On the attached (t/hse) front, sales numbers down 10% while apt sales were down 14%. Average prices up 18% (t/hse) and up by 14% for apartments. We continue the “leveling off”, but all prices clearly up over last year. Inventory (t/hse) up from ‘05, by 12%, and (apt) up from ’05 by 20%.
In W/Van, detached shows a 3% drop in number of sales 05/06 YTD. Average price +20% YTD and inventory now stands at 19% higher than 2005. On the condo side – attached (t/hses) sold are up 6% YTD over 2005; average price change up 4%. Active listings down 8% from last year. Apts reflect 15% fewer sold vs. ‘05; with average prices up 42% and active listings at 88 compared to 80 in ’05 (+9%). The North Shore maintains its more gentle sales pattern and its increased prices month over month from last year.