The Vancouver housing bubble has finally burst and here is just some of what I have seen in the past month or so that has led me to this conclusion:
- Year over year sales dropped 30% in May 2008 and “Listings [are] up. Way way up!”.
- Inventory levels are crazy…check out the mid-May 2008 inventory chart for the entire GVRD and the mid-May 2008 inventory chart for Vancouver West.
- A local realtor is selling a house on my street and has been trying to sell it for a long time. Looks like a lot of his properties are selling at a “reduced price”!
- Anectodal evidence of prices dropping in Port Moody and Coquitlam and empty open houses.
- Foreclosures have doubled since last year.
- MSM (main-stream media) is reporting on it. Two more articles just appeared in the Sun one day apart: “B.C. Housing Sales Slow” and “Eroding consumer confidence puts a pause in B.C. housing market“. Sure, these articles are mostly just reporting on recent real estate data but, there are some comments like this: “For the past six years there’s been a remarkable boom in the residential real estate market. Booms can go bust. But this isn’t a bust — at least not yet: It’s a breather.” That’s they type of comment that you would have a hard time finding in the MSM over the past 6 years. It’s basically saying, in MSM-speak, the bubble has popped.
- More evidence: I was recently watching 6 homes in Vancouver West on MLS. It only took 3 days until this 3 bedroom 3 bathroom townhome dropped its price from $1,025,000 to $995,000, a 2.9% decrease.
Look for the real estate people to stay positive all the way down to the bottom. Check out this awesome graph charting David Lereah’s (US National Association of Realtors Chief Economist) comments.