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Baby, we got a bubble!?
- Thread starter simuls
- Start date
interested
Senior Member
I will take a stab at making some sense.
I believe people are trying to arrive at predetermined conclusions and using arguments that support their cause.
I will concentrate on the price for the moment. Prices last year were on a climb commencing April or so and continued to rise. Therefore, while prices are up for april 2009 to april 2010, may 2009to May 2010, June 2009 to June 2010: July 2010 prices are in fact lower than June 2010 I believe. Further, since prices continued to climb in 2009 for the rest of the year, the relative price increase is falling (and doing so rapidly). At this rate, in 2 to 3 months, there will be no more growth year on year and by Oct or so price declines year on year will commence.
So to improve numbers, those promoting real estate will say but compared to the "average of 2009, prices are still up".
Remember, housing starts take time to occur. They are a lagging indicator since plans have to be drawn, permits obtained and therefore expect that within a few months, these too will decline as it becomes clearer that house prices are no longer rising (read falling) and that the market has shifted.
I would contend the rate of decline is alarming of sales compared to last year. True, they say house listings are down but conveniently, the numbers are not in the article and I suspect that while down, they are not down near the 3000+ shortfall in sales. In other words, inventories I believe are still rising. Perhaps someone could shed some light on this further.
Again, and no disrespect to my mathematical colleagues: There are lyers, damn lyers, and statisticians, My point is that the results you are reading depends on the spin the person giving the facts wishes to achieve.
I believe people are trying to arrive at predetermined conclusions and using arguments that support their cause.
I will concentrate on the price for the moment. Prices last year were on a climb commencing April or so and continued to rise. Therefore, while prices are up for april 2009 to april 2010, may 2009to May 2010, June 2009 to June 2010: July 2010 prices are in fact lower than June 2010 I believe. Further, since prices continued to climb in 2009 for the rest of the year, the relative price increase is falling (and doing so rapidly). At this rate, in 2 to 3 months, there will be no more growth year on year and by Oct or so price declines year on year will commence.
So to improve numbers, those promoting real estate will say but compared to the "average of 2009, prices are still up".
Remember, housing starts take time to occur. They are a lagging indicator since plans have to be drawn, permits obtained and therefore expect that within a few months, these too will decline as it becomes clearer that house prices are no longer rising (read falling) and that the market has shifted.
I would contend the rate of decline is alarming of sales compared to last year. True, they say house listings are down but conveniently, the numbers are not in the article and I suspect that while down, they are not down near the 3000+ shortfall in sales. In other words, inventories I believe are still rising. Perhaps someone could shed some light on this further.
Again, and no disrespect to my mathematical colleagues: There are lyers, damn lyers, and statisticians, My point is that the results you are reading depends on the spin the person giving the facts wishes to achieve.
KA1
Senior Member
Just a few words to correct your grammer, Interested. It is "lies, damn lies and statistics" (grin here).
myfive
Active Member
I wouldn't read too much into the 3.3% price decline. With sales volume dropping thru the summer doldrums the overall price change will be skewed by the lower volume. For example, maybe a lot of cheaper condos sold in July as opposed to expensive houses.
I call it pretty much a wash and prices are holding steady, which is mostly due to the drop in listings to offset the sales volume drop.
Overall, the perforance of the market is excellent given we are in the summer and have the post HST lull as people adjust.
Put this formula in your pocket:
Low Interest Rates + Low Unemployment + Good Economic Growth = Rising Real Estate Prices
CN Tower
Banned
Lowest Toronto July sales since 2004
Lowest Toronto July sales since 2004. Enough said.
http://tinyurl.com/3a3zqom
Lowest Toronto July sales since 2004. Enough said.
http://tinyurl.com/3a3zqom
cdr108
Senior Member
to help put things in perspective, i pulled the June and July 2009 reports to also access June/July 2008 figures since 2009 was such an anomoly ...
here's the MW report for June 2009 ...
http://www.torontorealestateboard.com/consumer_info/market_news/mw2009/pdf/mw0906.pdf
Housing Market Indicators June 2008 June 2009 % Change
Sales 8,600 10,955 (27%)
New Listings 16,069 13,357 (-17%)
Active Listings* 26,697 18,704 (-30%)
Days on Market 34 33 (-3%)
here's the MW report for July 2009 ...
http://www.torontorealestateboard.com/consumer_info/market_news/mw2009/pdf/mw0907.pdf
Housing Market Indicators July 2008 July 2009 % Change
Sales 7,806 9,967 (28%)
New Listings 14,830 12,174 (-18%)
Active Listings* 26,543 16,915 (-36%)
here's the MW report for June 2010 ...
http://www.torontorealestateboard.com/consumer_info/market_news/mw2010/pdf/mw1006.pdf
Housing Market Indicators June 2009 June 2010 % Change
Sales 10,955 8,442 (-23%)
New Listings 13,357 15,086 (13%)
Active Listings* 18,704 23,923 (28%)
Days on Market 33 27 (-18%)
regarding lower listings, hence lower sales ... didn't TREB at some point say lower listings resulted in higher sales + prices b/c people were competing for limited product ?!?
comparison for 2008/2009/2010:
Housing Market Indicators June 2008 June 2009 June 2010
Sales 8,600 10,955 8,442
New Listings 16,069 13,357 15,086
Active Listings* 26,697 18,704 23,923
Days on Market 34 33 27
Housing Market Indicators July 2008 July 2009 July 2010
Sales 7,806 9,967 6,564
New Listings 14,830 12,174 10,825
Active Listings* 26,543 16,915 21,714
daveto
Active Member
Why did US housing prices decrease in 2007?
KA1
Senior Member
Only thing we have in this equation is Low interest rates. And that is not enough to spur sales and rising real estate prices.
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KA1
Senior Member
Thanks for quoting various figures Cdr.
Can you, please, add your understanding/conclusions of the statistics? Txs.
myfive
Active Member
U.S. Real Estate Peaked in 2007. Since then unemploiyment has been rising due in large part to the 'gutted' manufacturing base because jobs have been shipped overseas, and related job losses in the support industries. They then entered a recession and are still not projectting much growth. (I thought everybody knew these things!)
So their real estate may contine lower unless unemployment or economic growth can turn around.
myfive
Active Member
interested
Senior Member
Thanks CDR.
This helps.
It confirms my suspicions. Sales from last year are down 3400 units. but only 1300 from 2 years ago.
New listings have continued to drop but the active listings is up sharply from last year though down from 2008 when alot of listings due to frothy prices. So, the total active listings went up 4800 units and sales down 3400 units for a net of 8200 more properties on the market this July compared to last year.
Again what is worrisome is that the market is going down, even if resale listings come on the market more slowly now as people are sidelined again, what about the 12000 new condo units to come on line in the next 6 months. Assuming 25% come on the market, that is another 3000 listings.
Barring a marked change, we will be reaching 2008 active listings very soon and if sales are not where they were in July 2008 (when they were very strong so unlikely to be that strong), there will definately be more downward pressure on prices.
daveto
Active Member
Not true. It peaked in Q4 2006, and decreased throughout 2007.
http://www.standardandpoors.com/ser...alue3=abinary;+charset=UTF-8&blobnocache=true
I don't mind discussing the issues, but it's not fair of you to post unsupported and inaccurate statistics.
thx
dt
KA1
Senior Member
For the next time around, Bank of Canada has already sounded cautious/no increase move.
myfive
Active Member
These guys are saying March 2007
http://investmenttools.com/median_and_average_sales_prices_of_houses_sold_in_the_us.htm