June 2009 Vancouver Real Estate Update / Everest Report
I am back from Everest and sad to report that I was unsuccessful in reaching the summit. Although I had an army of people praying for good weather, a cyclone in the Bay of Bengal sent us a metre and a half of snow on us the night we started our push and threw in some heavy wind for good measure. I missed the one weather window that the North side had this season by one day. It was a disappointing experience to not get a chance to go to the summit but it is a fairly routine problem in the mountains and fortunately or unfortunately I will try again either next spring or in 2011.
On the positive side, I am glad to report that the market has been quite robust while I have been away:
Sales volumes increased and active listings decreased three months in a row for all product types pushing the months of inventory index down to below 3 months for detached and apartments and below 4 months for attached homes. This strong trend is likely a combination of both “pent up demand” (buyers who were waiting for the market to fall finally bought) and incredibly low interest rates. With the bond market recovering and fixed term interest rates poised to continue to rise we can expect 3 more months of strong activity while buyers with held rates get their shopping done. The strong trend is unusual in light of the larger recessionary market forces currently at play but certainly good news for Vancouver. The months of inventory index suggests upward price pressure over the next several months and the average price chart shows that this has already been the case over the last three months.
Attached are links to the current Inventory and Average sales graphs for Vancouver West (May need to visit samwyatt.com for links to work)Vancouver West Inventory May 2009.pdf Vancouver West Average Sale Prices May 2009.pdf.
Remember that: “Months of Inventory” is a measure derived from the number of active listings during a given month divided by the number of sales that month. It indicates the theoretical length of time it would take to sell all of the properties on the market if nothing changed. Historically, 0-5 months of inventory has meant generally upward price pressure for the ensuing six months, 5-8 months of inventory meant a flat market with respect to pricing and over 8 months of inventory has precipitated downward price pressure.
By Sam Wyatt, Vancouver BC Realtor.