B.C. Lower Mainland real estate sales plummet in July

[SpongeG]

B.C. Lower Mainland real estate sales plummet in July

VANCOUVER — B.C. Lower Mainland real estate markets saw their slowest July in decade, the region's real estate boards reported Wednesday, with sales down by almost half from July 2009's red-hot markets and prices slipping from the previous month's levels.

In Metro Vancouver, excluding Surrey, realtors saw 2,255 sales registered through the Multiple Listing Service, a 45-per-cent decline from July 2009. In the Fraser Valley, July MLS sales were off 47 per cent with 1,001 transactions.

The benchmark price for detached homes, an average for typical homes sold, dipped a negligible 0.2 per cent to $793,193 in the area of Metro Vancouver covered by the Real Estate Board of Greater Vancouver.

Fraser Valley Real Estate Board realtors saw its detached-home benchmark hit $510,470 in July, down 1.5 per cent from June, and the board reported that its benchmarks in all three categories fell from the previous month for the first time since January 2009.

...

Read more: http://www.vancouversun.com/business...#ixzz0vfusC3D3

[SpikePhanta]

HST probably is one of the main reasons

[Yume-sama]

Even though it doesn't count on re-sales, the mis-information about it through-out the province has probably cost an incalculable amount of money.

If the price of the home itself is only down a negligible 0.2%, we aren't seeing a market correction at work. We are seeing other factors scaring people off~

Of course, another reason why as many homes aren't selling is that... not as many homes are listed for sale every month. Those are also down 18% according to the article.

Both boards noticed that new listings of homes for sale are also waning.

In Metro Vancouver, new listings were off almost 18 per cent from a year ago. In the Fraser Valley, new listings were down 27 per cent.

[Zassk]

Funny how a 7% surge in house prices would irrationally motivate more people to buy, yet a 7% increase in taxes somehow has the opposite effect...

[Yume-sama]

Originally Posted by Zassk

Funny how a 7% surge in house prices would irrationally motivate more people to buy, yet a 7% increase in taxes somehow has the opposite effect...

Giving more to the "man" is never the option people choose Maybe if it was built in to the price, there wouldn't be the psychological aspect of it.

BUT if you buy a new condo in Vancouver for say, $500k, now you owe the government somewhere in the range of 14.5% with property transfer tax in there.

THAT is scary. An extra needless expense of $70,000~! However, if you just list the condo for $570,000 it all the sudden seems better...

In my opinion, there should neither be GST or PST or HST or ANY tax of the sort on housing, anywhere in Canada.

[Smooth]

I think it has just as much to do with rising interest rates. I'm sure there's lots of people who also just assumed that HST will make purchasing a home that much more expensive and have now held back. I think for most people it won't make a difference on the sticker price. Real estate agent fees might be the only thing that the HST will change.

The funny thing is, if sales have dropped off then the price of homes will be lowered so that they'll sell. HST could potentially lower the price of homes over the short term, at least until the market finds a balance again.

Also, just to clarify things here... HST only applies to new homes that cost over $525,000. You claim a rebate on the first $525,000 so you only pay tax on anything above that.
http://hst.blog.gov.bc.ca/faqs/new-housing-rebate/

[twoNeurons]

• HST
• Stricter buying rules
• Uncertainty over whether a correction is coming
• Higher interest rates
• People perhaps feeling the market's overvalued/peaked

There are likely a few reasons why there are fewer sales.

[JimmyJ]

What a crock article...July 2009 was the hottest month on record; the fact that we're down from that means the sky is falling??

[Yume-sama]

Originally Posted by JimmyJ

What a crock article...July 2009 was the hottest month on record; the fact that we're down from that means the sky is falling??

Perspective is rarely something the media has. Or the average person, really~

It's easier to fear monger!

[Rusty Gull]

The market has been upwardly mobile for nearly a decade.

A cooling off period is not a bad thing at all. With so many international markets in the toilet (US, UK, Japan, southern Europe, etc) we are going to see a major downturn in interest of higher-end properties. That means more choice for the few of us who actually work and live here.

[mrjauk]

Originally Posted by JimmyJ

What a crock article...July 2009 was the hottest month on record; the fact that we're down from that means the sky is falling??

July 2010 sales in Vancouver were about 2200, which, except for 2008, is the lowest total (by far) since the late 1990s. What's happening is not unexpected and happened in 2008. Prices got to the point where the marginal buyer can no longer afford them. Prices in Vancouver slide 15% over 9 months in 2008 and didn't stop sliding until the Harper government urged the BoC to drop interest rates to almost zero.

The question those of you who are banking on price appreciation have to ask yourselves is "what mechanism is potentially available that could have the same effect on real estate prices as lowering interest rates to zero?"

Some of you may remember that I thought prices would have dropped much more dramatically by now than they have, so you may want to discount what I've said. But I'm sticking by my call for a drastic drop in real estate prices in Vancouver, with much worse price drops in boomer-affected areas such as the Gulf Islands and parts of the Okanagon.

[WBC]

Originally Posted by mrjauk

July 2010 sales in Vancouver were about 2200, which, except for 2008, is the lowest total (by far) since the late 1990s. What's happening is not unexpected and happened in 2008. Prices got to the point where the marginal buyer can no longer afford them. Prices in Vancouver slide 15% over 9 months in 2008 and didn't stop sliding until the Harper government urged the BoC to drop interest rates to almost zero.

The question those of you who are banking on price appreciation have to ask yourselves is "what mechanism is potentially available that could have the same effect on real estate prices as lowering interest rates to zero?"

Some of you may remember that I thought prices would have dropped much more dramatically by now than they have, so you may want to discount what I've said. But I'm sticking by my call for a drastic drop in real estate prices in Vancouver, with much worse price drops in boomer-affected areas such as the Gulf Islands and parts of the Okanagon.

I completely agree. The party is over. And if you guys think that 70 year old house in east van should be 20 times the average annual income just because Vancouver is special think again.

[Yume-sama]

The Okanagan has already seen a big drop. Particularly Kelowna. But their market relies on people from Calgary, and Vancouver, being wealthy enough... and feeling comfortable enough... in buying there.

The mythical foreign buyer isn't so mythical there. I can't count how many people I know with a condo / house somewhere in or near Kelowna.

Come the long weekends their roads can't even support the communities once all the people who own there, are actually there...

One day I would like to own a condo or house there, too

[SpongeG]

HST contributing to double-digit decline in B.C. housing starts

Tuesday, 10 August 2010

The number of B.C. housing starts fell 13.3% in July, according to data released Tuesday morning by the Canada Mortgage and Housing Corporation (CMHC).
The number of starts fell to 1,817 in July, down from 2,096 in June. The most significant decline was in Metro Vancouver with a 10% decline to 1,124 units from 1,250 in June.

From a seasonally adjusted basis, B.C. housing starts fell 14.8% in July, slipping to an average annual rate of 20,100 from 23,500 in June. The average annual rate in Metro Vancouver fell to 12,900 units from 14,100.

CMHC senior market analyst Robyn Adamache said in an interview, “The decline is not huge, but it’s pretty much what we had been expecting in terms of some moderation in the market going forward. People are expecting mortgage rates to go up a bit and sales in the resale market have slowed a bit.”

Other urban regions in the province with declines last month included Kelowna, Victoria, Kamloops and Nanaimo.

Nationally, the number of housing starts fell 1.6% in July to 189,200 units from 192,300 units in June. An RBC Economics report noted this is the third consecutive monthly decline, although, the dip was less than the decline expected by analysts.

The report noted that housing starts were largely concentrated in the two provinces that introduced the HST in July: B.C. and Ontario.

...

http://www.bivinteractive.com/index....2901&Itemid=32

[WarrenC12]

Can somebody lay out the pre and post-HST cost of a house? I didn't think it made much difference based on different housing sale prices.

[Smooth]

From the government's website...

"used (i.e., resale) residential housing is not subject to HST"

Total Sales Tax Payable on New Homes

http://hst.blog.gov.bc.ca/faqs/new-housing-rebate/


And here's a New Home HST Calculator