Uncertain fate for Vancouver real estate prices
At least one economist says it's much too soon to say the bubble's burst
Vancouver's real estate market has taken another interesting turn, with listings up and sales down during what is usually a busy time of year.
In May, average prices for houses have dropped about $150,000 compared to one year ago. That 12-per-cent drop wiped out two years of price increases.
The reason appears to be that too many more sellers are trying to cash in at the same time. Listings are up by 23 per cent, but fewer are buying: sales are down 24 per cent.
"Probably, on average, about a 150 or 160 homes in Vancouver are reducing their price every day in the hope of catching, getting ahead of the train and maybe get out before they can't," said realtor Larry Yatkowsy.
Predictions of a bursting real estate bubble have swirled around the Vancouver market for years. Despite the indications, economist Tom Davidoff, of UBC’s Sauder School of Business thinks it’s too early to name it yet.
"It’s going to take several months of data-confirming of what we seem to be seeing before I would be anywhere close to be prepared to say, 'That's it, we had a bubble and now it's bursting,'" Davidff said.
On Monday, the Real Estate Board of Greater Vancouver releases its own statistics for May. It calculates prices changes on the value of a typical home, not on averages.
But it's expected those numbers will show that sales are down, putting more downward pressures on prices.
With files from the CBC's Kirk Williams