When you’re actively looking at real estate prices on a daily or weekly basis, either because this is part of your job or you happen to be in the middle of buying or selling a property and you want to keep a close watch on things, it can paradoxically become harder to notice big shifts in the market.
Why is this so?
Changes in real estate values for whole markets are usually determined using “benchmark prices” for properties the real estate board producing the statistics deems “typical.” Those values will average gains of only a few percentage points annually.
Even when a market swings as much as 10% either way in a given year, that’s less than 1% on a monthly basis. It’s a little hard to notice in the listing and sale prices for the relatively small section of the market than any one person happens to be tracking.
And watching the changes closely actually makes it harder to perceive the shift, since it’s happening so gradually.
This makes it a good practice to look back every so often and gain some better perspective. It may cause a person to refresh their take on where things stand. Six months seems a good amount of time for this kind of exercise.
So what has happened in Vancouver over the last six months?
Actually, benchmark prices for Vancouver’s west side as a whole are down nearly 5%. The east side of Vancouver has held more firmly, but is also down just under 4%. Note that these trends, if they hold for a year, constitute very significant price drops. To make an obvious point, a 10% drop on a $1M property is $100K.
In fact, the numbers over a full year are even more stark, so the last six months represent a mild improvement for owners and sellers in the sense that the rate of decline seems to have slowed.
Interestingly, detached homes have continued to be hit the hardest. Condo losses have slowed and East Van condos barely moved over the last six months (less than 1% drop in benchmark price).
Townhomes have fared better than condos and detached homes over six months. They are completely flat over that period in East Van.
Does this correspond with what you’ve been reading? Does it shift your perspective at all?
More stats are available and more stats are always coming!