A gentle and positive slow down in our real estate market has been turned into a dramatic downturn with evidence of instability and a body blow to consumer confidence. Many purchase contracts negotiated over the past four years or so are being “rewritten” by what is being touted by many as a pre-election move, the far reaching implications of which do not appear to have been fully considered by the decision makers. Don’t get me wrong, I am and have been in favour of the imposition of some action to discourage the excessive foreign investment in Greater Vancouver’s residential housing stock. A commentator used the term “too little to late” – not appropriate here – more like “overly drastic and far too late”.
The comments I have made over the last two months, that the listings for sale (inventory) were starting to increase and numbers of sales starting to diminish is continuing. Little did we know that the provincial government would rush their “foreigner tax” through without warning and scant thought of the consequences. Yes folks, the buyers and sellers are indeed stunned and this will cause the public to hold back on making decisions. Innumerable contracts will collapse as foreign buyers back out. Not only will many Mainland Chinese do so, but the mega artillery [15% tax] used to discourage (‘punish’) the Asian luxury home investor, but those planning immigration to Canada (many with work permits and jobs here) may become collateral damage….and, yes, all we current Canadian home owners will likely see a decrease from the pre-August value of our homes. Better that these flagrant foreign luxury home investments had been discouraged some 10 plus years ago with a realistic “foreign investment tax” than allowing the rampant price growth to have gone unchecked.
Now to the YTD figures as we head into the final 5 months of 2016. North Van detached homes sold are 957 vs 969 last year on a YTD basis, attached (t/hses) down 4% from last year and apartments up 16%. The detached median price is up 30% and inventory now up 65% from 2015. Median prices (t/hses) up 31% and up 15% for (apts). Inventory (t/hses) up 20% from July 31st 2015 and (apt) down 11% from last year for the same date.
In West Van, detached number of sales YTD for July 31st 2016 is up by 7% from last year at that time. Median price of what has sold is up 38% from last year and inventory now up 9% from July 31st 2015. On the condo side, attached (t/hses) sold by July 31st 2016 are down 24% from 2016. Active listings at (6) are down from last year at July 31st (10). Apartments reflect a 28% increase in 2016 vs. 2015 – median price for (apts) sold increased by 10% for this period. Inventory (apts) down 29%.
Before I once again get castigated for having an opinion on past mishandling of what I strongly believe to be an important issue affecting my ‘beloved’ home and chosen city (also, despite the wording this is not at all an opinion on anthem rewording – a far less pressing issue) let me say that this isn’t a political endorsement or otherwise of ANY political party in any forthcoming election. I will also admit that, like many friends and colleagues, my wife and I have offspring born in the 2nd half of the ’80’s – the demographic potentially facing prolonged (or perpetual) tenancy.
Stephen Quinn (Host of ‘On the Coast’) and author of a recent Globe and Mail article most pertinent and succinctly “headlined” – ‘Letting the facts obscure the real story about real estate’. Coming as it did just after this week’s announcement that the BC Real Estate Council (the Council), appointed (by this same Government) approximately a decade ago to “self police” inappropriate Realtor behaviour in this province, was having their mandate revoked. That responsibility was being taken back by the same elected government that empowered this Council with the right to licence new salespeople/realty companies. An undisclosed number of these are currently under investigation/receiving suspensions and are some of those who are licensed through a company which is itself under “council supervision”.
A far greater percentage, of industry practitioners (be they sales associates, managing brokers or associate brokers) than any media/or governmental commentator have ever made reference to, totally agree with increased penalties and specifically a higher number of revocations of licence for unconscionable and unprofessional acts. The fact is that the ‘trade association’ Real Estate Board of Greater Vancouver, currently has far higher ‘dollar’ penalty levels than the Council (the now disenfranchised “self” governing body). Strangely this has to my knowledge not been highlighted. The only ‘higher level’ penalty the Council wielded was suspension and removal of licences. Even this censure, history shows, they have been reticent to use. Maybe those violators are also those not reluctant to sue for what many wrongdoers often claim to be “unfair treatment”?