British Columbia Q2 2008 Residential Sales Summary
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British Columbia Q2 2008 Residential Sales Summary The Landcor Report – Sept 2nd, 2008
www.landcor.com
Landcor Data Corporation. Real estate data and analysis experts. Dear Valued Data Users, The best real estate decisions are made using comprehensive and reliable information. Since our incorporation in 1987, Landcor Data Corporation has grown to be one of the most trusted providers of objective real estate data and analysis in British Columbia. Last year, over $70 billion in residential property values were pulled through our systems. During the past two decades, we’ve helped thousands of clients achieve their goals by offering the most comprehensive data, analysis and insight available. Our clients include a wide array of local, provincial, national and international financial institutions, real estate brokers, strata corporations, property managers, landlords, insurers, government agencies, investors, academics, homeowners and the media. From real estate valuation and analysis to land economics research and systems development, our staff of highly qualified experts are here to help you find solutions to your real estate analysis and data needs. Landcor maintains the largest, most comprehensive database of historical sales and current information on BC residential and commercial markets. Unlike MLS® data which includes only broker sales, Landcor’s data utilizes government land titles information which includes all registered sales – MLS® and nonMLS® – in British Columbia. Founded by Rudy Nielsen, R.I. (B.C.) F.R.I., Landcor is a wholly owned subsidiary of the NIHO Group of Companies. We’re providing this report in response to your interest in our company. The purpose is to provide marketwide trends for British Columbia based on available historical information. For further information on what Landcor can offer you and your business, contact Rudy Nielsen at 604-606-7914, or at [email protected]. For information about Landcor’s products and services, visit our website at www.landcor.com. Thank you for your interest in Landcor Data Corporation and have a great day.
Yours sincerely,
Rudy Nielsen, R.I. (B.C.) F.R.I. President & Founder
LANDCOR Data Corporation #200 - 313 Sixth Street New Westminster, BC Canada V3L 3A7
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Contact Rudy Nielsen R.I. (B.C.) FRI Tel: 604-606-7914 [email protected]
Q2 2008 Report Summary – Buyers remain in the driver’s seat. The numbers are in, and Landcor Data Corporation finds that the number of residential sales throughout the province continues to decline. In turn, this is causing the total value of residential sales to drop in all BC markets for the first time in five years. What does this mean for home buyers and sellers in BC? Landcor Data Corporation’s Q2 Residential Market Analysis found that: 1. Sales prices throughout the province have continued to adjust this quarter, with median price changes ranging from -3.8% to 15.6%, depending on the region and property type. Change in Median Sales Price, Q2 08 to Q1 08 • Greater Vancouver -0.2% to 3.4% • Okanagan -1.9% to 8.7% • Kootenays 1% to 7% • Fraser Valley -3.8% to 1.1% • Vancouver Island -3.5% to 3.8% • Northern BC 1.2% to 15.6% ~ Figures noted above are median price comparisons from Q2 08 to Q1 08, ranging by property type
2. The lack of affordable detached single-family homes has skewed buyer preferences in some regions. • Almost half (48%) of all residential home buyers in BC chose condominiums or attached homes, which is an increasing trend. • Nearly two thirds (63%) of buyers in Greater Vancouver chose condominiums or attached homes. • Almost half (47%) of all Fraser Valley area buyers chose condominiums or attached homes. 3. Out-of-province purchasers remain hesitant about investing in BC, with purchases from the United States and the rest of Canada (non-BC) down 24% since 2007. • However, Albertans made a come-back in the second quarter, up 36% over the total number of sales in Q1 08. After years of sky high prices, the market continues to cool, leaving buyers in the driver’s seat for another quarter. As buyers continue to be selective, it has become more difficult to sell your home. If you are selling your home or if you plan to: • Price smart – the market may be cooling, but homes that are properly priced will sell. • Market a quality product – make sure your home is at its best, since it has to be in the top 60% of homes on the market to move in a timely manner • Sell first and then go looking – if you do the opposite, you could be stuck with two mortgages, two sets of payments, two utility bills, two homes to keep up. Sell first and then buy. What lies ahead for us? With Federal, Municipal and American elections fast approaching, these are interesting times for our economy and real estate market. Will prices continue to adjust or will the market regain it’s footing in the coming months? Only time will tell and we will continue to keep you up-to-date in our following quarterly reports.
Stay tuned for more from Landcor Data Corporation Landcor is currently working on two more special reports: • Using the power of Landcor’s industry renowned Property Valuator, we will assess if there are pockets of negative equity in BC. • Using BC’s historic sales data unique to Landcor Data Corporation, we will analyze the impact of interest rate fluctuation on residential home sales since 1974.
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www.landcor.com
Q2 2008 - Provincial Overview
Provincial Overview Total Number of Residential Sales in BC - First Half of Year
Total Number of Residential Sales in BC - Q1 and Q2
The total number of residential sales in BC is down in the first half of 2008 by 15.2% compared to the first half of 2007, from 75,788 to 64,268 total sales. This follows a 4.8% decrease from the previous year, and has now fallen below 2004 levels. Note: 2006 was a record year for residential property sales.
The total number of residential sales in BC is down in the second quarter of 2008 by 19.5% compared to the second quarter of 2007, from 45,459 to 36,612 total sales. Q1 08 was also down 8.8% vs Q1 07.
Total Residential Sales Volume in BC - First Half of Year
Total Residential Sales Volume in BC - Q1 and Q2
The total residential sales volume in BC is down in the first half of 2008 by 4.1% compared to the first half of 2007, from $28.59 billion to $27.4 billion in total sales volume. This follows a 10.5% increase over the previous year, and still well above 2006 levels. Note: 2007 was a record year for residential sales value.
The total residential sales volume in BC is down in the second quarter of 2008 by 11.6% compared to the second quarter of 2007, from $17.49 billion to $15.467 billion in total sales. This is the first decrease in total sales volume in the 5 years examined (since 2004). However, Q1 08 was up 7.6% over Q1 07.
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Q2 2008 - Provincial Overview
Total Number of Residential Sales by Property Type - Q2 per Year
All four property types saw the total number of residential sales decrease this quarter, compared to Q2 07. Detached and Vacant Land saw the greatest decrease, both over 23%. Condos saw the least change year over year, with a decrease of 12.2%.
Total Residential Sales Volume by Property Type - Q2 per Year
The total residential sales volume decreased in each of the four property type categories this quarter compared to last year. Vacant Land saw the greatest percentage decrease, at almost 24%. Condos saw the smallest decrease in total sales volume at 2.5%. Detached property sales volume was down a total of $1.26 billion (-12.8%) this quarter compared to Q2 2007 (which was a record year).
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www.landcor.com
Q2 2008 - Provincial Overview
% Change in Total Number of Sales & Sales Value by Region - Q2 08 vs Q2 07
Every region saw a dramatic drop in both volume and count in Q2 08 vs Q2 07. The largest drop, by percentage, was in Northern BC, where the volume and count are down 17% and 25%, respectively. Fraser Valley saw the smallest decrease at only 8% in volume and 14% in total sales count.
Stay tuned for more from Landcor Data Corporation Landcor is currently working on two more special reports: •
Using the power of Landcor’s industry renowned Property Valuator, we will assess if there are pockets of negative equity in BC.
•
Using the historic BC sales data unique to Landcor Data Corporation, we will analyze the impact of interest rate fluctuation on residential home sales since 1974.
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Q2 2008 - Provincial Overview
Total Number of Residential Sales by Region - Q2 per Year
Residential sales in Greater Vancouver slipped by over 2,900 in Q2 08 compared to Q2 07. The Okanagan saw a substantial slip as well, down over 2,000 sales. The Fraser Valley remained the most stable market, averaging around 5,000 sales in Q2 for the past 5 years.
% Change of Number of Residential Sales by Region - Q2 per Year
The Kootenays saw the largest percentage decrease in Q2 08 compared to Q2 07, at -28.56%. The Okanagan had a comparable decline at -26.44%. Fraser Valley and Greater Vancouver saw the smallest declines, both approximately -15% over Q2 07.
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www.landcor.com
Q2 2008 - Provincial Overview
Total Residential Sales Volume by Region - Q2 per Year
After seeing increases in every region in the second quarter of 2007, this year’s second quarter saw every region declining in total residential sales volume. Greater Vancouver was down by more than $1 billion this quarter, compared to last year. The Okanagan and Vancouver Island saw the second and third largest declines, both down more than $330 million over the same period last year.
% Change in Residential Sales Volume by Region - Q2 per Year
The largest decrease year over year occurred in BC Northern/Northwest, declining 17%; the smallest decrease was in Fraser Valley, at -8% over Q2 07. The Kootenays saw the greatest net change, going from a 36% increase in Q2 07 to a -11.84% decrease in Q2 08.
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Q2 2008 - Provincial Overview
Total Number of Residential Sales by Region - Q1 08 vs Q2 08
The total number of residential sales in BC is up across the province when compared to last quarter. Greater Vancouver had the greatest regional increase, up over 3,200 sales compared to Q1 08. The Kootenay region saw the smallest increase, up 649 sales over Q1 08.
% Change in Number of Residential Sales by Region - Q1 08 vs Q2 08
Every region in BC saw an increase of over 25% in the total number of sales in Q2 08 compared to Q1 08. The largest change was the Kootenay region, at over 62%, followed by BC Northern/Northwest at 56% and the Okanagan and Vancouver Island, both increasing around 34%.
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Q2 2008 - Provincial Overview
Total Residential Sales Volume by Region - Q1 08 vs Q2 08
Residential sales volume across the province is up in Q2 compared to Q1. Greater Vancouver saw more than a $1.5 billion increase in total sales volume over the previous quarter. Vancouver Island and the Okanagan both increased by more than $500 million. As the smallest region in the Province, the Kootenays saw the smallest Q2 increase over Q1 this year, gaining only $168 million in total sales over the previous quarter.
% Change in Total Residential Sales Volume by Region - Q1 08 vs Q2 08
The two regions with the smallest gains in total value saw the greatest percentage increase over last quarter – BC Northern/Northwest and the Kootenays, at 67.5% and 63.3%, respectively. The same is true on the other end of the spectrum, with Greater Vancouver seeing the smallest percentage increase over Q2 in total sales value, at 22%.
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Q2 2008 - Provincial Overview
Median Residential Sales Price in BC - Q1, Q2 & Half Year - per Year
Although the total sales counts and sales volumes are down in BC this quarter, median sales prices continued to increase this year. The median sales price of residential property in BC in the first half of 2008 is up $46,668 compared to 2007. Q1 08 is up over $60,000 since Q1 07, and Q2 08 is up almost $38,000 over Q2 07. The median sales price in BC is up about $3,000 in Q2 08 compared to Q1 08.
% Change in Median Residential Sales Price - Q2 vs Q1 per Year
The second quarter of 2008 saw median prices increase a meager 0.7% over Q1 08. In 2006 and 2007 BC’s residential real estate market posted Q2 median price gains of over 7%. This year’s performance remains slightly above 2004’s Q2 vs Q1 change of -0.03%.
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Q2 2008 - Regional Overview - Median Sales Price Fraser Valley Median Sales Price by Property Type - Q2 08 vs Q1 08
The Fraser Valley has seen little change in the median prices of residential properties in Q2 08 compared to Q1 08. Attached home median sales price remained the same, while detached increased by $5,000 and condos dropped by $9,000 over the previous quarter.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached homes were the only property category to post an increase in sale price in the Fraser Valley, rising a meager 1%.
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Q2 2008 - Regional Overview - Median Sales Price Greater Vancouver Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached homes in Greater Vancouver increased $20,500 in median price over the previous quarter, followed by attached homes at $13,430. Condos headed in the other direction, slipping slightly by $550 over Q1 08’s median sales price.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached and attached home median sales prices both rose 3% in Q2 08 compared to Q1 08.
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www.landcor.com
Q2 2008 - Regional Overview - Median Sales Price Kootenay Median Sales Price by Property Type - Q2 08 vs Q1 08
The Kootenays saw all three property types increase in value this quarter compared to Q1, but all net out in the mid-high $200K range. There is less than a $23,000 difference between the median sales price of a detached home and a condo in the Kootenay region this quarter.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached gained a slight 1% over the previous quarter’s median sales price, while attached prices gained 7% and condos almost 5%.
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Q2 2008 - Regional Overview - Median Sales Price BC Northern/Northwest Median Sales Price by Property Type - Q2 08 vs Q1 08
The most affordable market in BC is again the Northern region, where the median sales price of a detached home remains under $250,000. This causes the majority of buyers to select detached homes, which increased less than $2,500. Condos and attached homes, which have less supply and demand here, increased $15,900 and $13,250 over the previous quarter’s median sales price, respectively.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
The largest median sales price quarterly percentage increase in the North this quarter was condos, up 15.6%. Attached homes were up just under 9%, while detached held steady with an increase of only 1%.
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Q2 2008 - Regional Overview - Median Sales Price Okanagan Median Sales Price by Property Type - Q2 08 vs Q1 08
Condos in the Okanagan gained an impressive $22,395 over the previous quarter’s median sales price. Detached followed at $7,750 and attached took a dip, losing $6,300 in value.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
The median sales price of Okanagan condos increased nearly 9% in Q2 08, while detached and attached homes gained and lost 2%, respectively.
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Q2 2008 - Regional Overview - Median Sales Price Vancouver Island Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached home sale prices made the largest gains in Q2 08, increasing $15,100 over the previous quarter. Condos dipped $10,000 and attached remained nearly the same, up only $1,000. Prices on Vancouver Island are very similar to those in the Okanagan.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached and condos gained and lost almost 4%, respectively, while attached posted an increase less than 1%.
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Q2 2008 - Property Type Preferences
Property Type Preferences
We were interested to see if the property type preferences of residential property purchasers had changed across the province this quarter. With the sky high price of detached homes, we decided to examine whether people have turned to more affordable options, such as condos and attached homes.
Share of Purchases - Detached homes vs Attached and Condos - BC ALL
We found that overall in BC, people had a slight preference for detached homes, accounting for 52% of total residential sales in BC this quarter. As illustrated above, this preference is depleting year over year, mainly influenced by the decreasing affordability of detached homes in most areas of BC.
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Q2 2008 - Property Type Preferences
Share of Purchases - Detached homes vs Attached and Condos - Fraser Valley
As house prices have increased in the Fraser Valley, it is evident that the preference for detached homes has slipped from 65.26% of all homes purchased in Q2 2004 to 52.51% in Q2 08. In Q2 08 there were 555 less detached homes sold in the Fraser Valley, while attached homes and condos increased by 74 purchases, compared to Q2 07.
Share of Purchases - Detached homes vs Attached and Condos - Greater Vancouver
As may be expected, condos and attached homes account for the majority of residential property purchases in Greater Vancouver. The decreasing affordability of detached homes is forcing families to purchase attached homes and condos, rather than detached properties. In the second quarter of 2008, almost 63% of purchases were attached homes and condos while detached homes accounted for only 37% of all purchases.
Share of Purchases - Detached homes vs Attached and Condos - Kootenays
With more reasonable detached home prices in the Kootenay region, 64% of residential property purchases in Q2 08 were detached homes. Though only 36% of purchases this quarter were condos, this segment has increased year over year in popularity.
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Q2 2008 - Property Type Preferences Share of Purchases - Detached homes vs Attached and Condos - Northern BC
Due to the lack of condo inventory in the North and the affordability of detached homes, the vast majority of residential purchases in Q2 08 were detached homes – a trend that has remained constant from previous years.
Share of Purchases - Detached homes vs Attached and Condos - Okanagan
In the Okanagan region, condos are growing in popularity, though they still do not account for the majority of residential property purchases. 62% of sales in Q2 08 were for detached homes.
Share of Detached homes vs Attached and Condos - Vancouver Island
Residential property purchasers on Vancouver Island maintain a strong preference for detached homes, with over 66% of residential purchases in Q2 08 being detached homes.
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Q2 2008 - Out-of-Province Sales Overview Out-of-Province Buyers Total Number of Residential Sales Purchased from Outside of BC - Q2 08 vs Q2 07
Out-of-province purchases are down in Q2 08 from US and Canadian investors. Alberta remains the largest out-of-province purchaser of BC property. Due to a change in currency values and a declining US economy, purchases from the United States are down 40% in Q2 08 compared to Q2 07. Alberta and Ontario buyers have also declined by 21.52% and 28.19%, respectively.
Total Number of Residential Sales Purchased from Outside of BC - Q2 08 vs Q1 08
Comparing the first two quarters of 2008, Alberta purchases have increased by 348. Purchases from the United States have remained steady, while Ontario buyers decreased slightly.
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Q2 2008 - Out-of-Province Sales Overview
Total Value of Residential Purchases from Outside of BC - Q2 08 vs Q2 07
The total value of out-of-province purchases is down in the second quarter of 2008 compared to the same quarter in 2007. Though they spent less in Q2 08 compared to the previous year, Albertans still spent close to a half of a billion dollars in BC this quarter. US buyers, however, spent almost half of what they did the previous year.
Total Value of Residential Purchases from Outside of BC - Q2 08 vs Q2 07
Comparing the first two quarters of 2008, the total value of Alberta purchases has increased by $113 million.
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Q2 2008 - Out-of-Province Sales Overview
Alberta Buyers Total Number of Residential Purchases by Albertans by Property Type - Q2 08 vs Q2 07
Of those properties purchased by Albertans in Q2 08, buyers preferred condos. This property type was the only one to increase in total number purchased in Q2 08 compared to Q2 07.
Total Value of Residential Purchases by Albertans by Property Type - Q2 08 vs Q2 07
Alberta purchasers spent more on BC condos than they did on detached homes this year. Another shift in purchase preference is Vacant Land—declining 46% in Q2 08 compared to Q1 08.
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Q2 2008 - Out-of-Province Sales Overview
Total Number of Residential Purchases by Albertans by Property Type - Q2 08 vs Q1 08
Of those BC properties purchased by Albertans this quarter, buyers preferred condos. Vacant Land and detached homes were also scooped up by Albertans this quarter.
Total Value of Residential Purchases by Albertans by Property Type - Q2 08 vs Q1 08
Albertans spent 63% more on condos and 42% more on detached homes in BC this quarter compared to Q1. Their investment in BC’s vacant land decreased 19% in Q2 08 compared to Q1 08.
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Q2 2008 - Out-of-Province Sales Overview
Location of BC Properties Purchased by Albertans - by Region - Q2 08 vs Q1 08
Alberta purchasers in Q2 08 focused their investment in the Kootenay and Okanagan regions. Surprisingly, Fraser Valley out-of-province purchases dropped off compared to the Q1 08, decreasing 63%.
Location of BC Properties Purchased by Albertans - Q2 08
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Summary
Glossary of Terms
BC’s residential real estate market continues to find its footing this quarter, with the number and value of residential sales slipping across the province. When compared to Q1 08 residential sale prices, median sale prices in Q2 made only moderate gains, and in some areas even declined.
Apartment:
Despite this recent breather in BC’s residential market, potential buyers still experienced difficulties in finding affordable single family homes in some regions, causing property preferences to shift to more inexpensive options, such as condos and attached homes.
A single-family occupied home located within a building containing multiple units. Also known as a condominium. Landcor uses the BC Assessment field Actual Use Type code 30 strata-lot residence (condominium).
Attached home:
A single-family occupied home attached by a common wall or walls to other like homes. Landcor uses the BC Assessment fields Actual Use Type 33, 34,35, 39, 47, 49, 36, and 41; including row housing, duplex, triplex, and fourplex structures.
In addition, out-of-province purchasers continued to stay home, with a trend of lower sales when compared to previous years. However, interest from Alberta picked up in the second quarter of 2008, with higher sale figures than the previous quarter.
Average price (also known as the mean):
With political change on the horizon, the immediate future remains uncertain. However, trust Landcor to keep you up-to-date with accurate, timely data on BC’s ever changing real estate market.
A free-standing single family residential building, also known as a Single Family Dwelling. Landcor uses the BC Assessment Actual Use Type codes 0, 32, and 60; including those single family dwellings, without or with basements, or less than or more than 2 acres of land.
Methodology Landcor maintains the largest and most comprehensive database of historical sales and current information on the BC residential and commercial markets. Using proprietary tools, Landcor staff analyze this information to provide a clear understanding of the market. All sales data encompass only arms-length transactions. This report is the summary of all second quarter sales transactions occurring in the province of BC between April 1st to June 30th of each year analyzed. All numbers are based on BC Assessment’s data available as of August 12th, 2008.
The price that results when all prices of properties in a given area over a specific time period are added and then divided by the number of properties in the distribution.
Detached home:
Median price:
The price that is midway between the least expensive and most expensive property sold in a geographic area during a specific time period. Half of all property buyers paid more than the median price and half paid less than the median price.
Other residential:
For information about the real estate market and trends, visit www.landcor.com.
Residential properties that do not fit within the other defined residential property types. Landcor uses BC Assessment Actual Use Type codes 20, 19, 31, 37, 38, 40, 42, 43, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 62, 63; including all residential outbuildings, stratalot residential parking and self-storage, manufactured homes, seasonal dwellings, multi-family buildings, stratified rental townhouses or apartments and seasonal dwelling and manufactured homes on 2 acres or more.
Questions and inquiries
Vacant Land:
Learn more
For questions about this report, or for consultation inquiries, contact Rudy Nielsen, President and Founder of Landcor Data Corporation at 604-606-7914 or [email protected].
Property that does not contain a building structure. Landcor uses the BC Assessment Actual Use Type codes 1 and 61; including vacant land less than, equal to or greater than 2 acres in size.
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Regional Boundaries Greater Vancouver: includes assessment area codes 8, 9, 10, 11, and 14 Vancouver Island: includes assessment area codes 1, 4, and 6 Thompson Okanagan: includes assessment area codes 17, 19, 20, and 23 Fraser Valley: includes assessment area code 15 Northern BC: includes assessment area codes 24, 25, 26, and 27 Kootenay: includes assessment area codes 21 and 22
Northern BC
Fraser Valley
Greater Vancouver
Thompson Okanagan
Vancouver Island
Kootenays
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LANDCOR Data Corporation #200 - 313 Sixth Street New Westminster, BC Canada V3L 3A7 604-606-7914 www.landcor.com
This report is provided by Landcor Data Corporation (“Landcor”) as a courtesy for general information purposes. Because the data in this report is provided to Landcor by the British Columbia Government and its various agencies, Landcor has no control over the accuracy of the data. The information in this document (the “content”) is therefore provided “as is” and “as available”. The content is provided without warranties of any kind, either express or implied, including, but not limited to, implied warranties of merchantability, fitness for a particular purpose, or noninfringement. Landcor, its subsidiaries, or its licensors are not liable for any direct, indirect, punitive, incidental, special or consequential damages that result from the use of this content. This limitation applies whether the alleged liability is based on contract, tort, negligence, strict liability or any other basis, even if Landcor has been advised of the possibility of such damage. Because some jurisdictions do not allow the exclusion or limitation of incidental or consequential damages, Landcor’s liability in such jurisdictions shall be limited to the extent permitted by law. © 2008. All information herein is intended for information purposes only. While this information is believed to be correct, it is represented subject to errors, omissions, changes or withdrawal without notice.
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www.landcor.com
Landcor Data Corporation. Real estate data and analysis experts. Dear Valued Data Users, The best real estate decisions are made using comprehensive and reliable information. Since our incorporation in 1987, Landcor Data Corporation has grown to be one of the most trusted providers of objective real estate data and analysis in British Columbia. Last year, over $70 billion in residential property values were pulled through our systems. During the past two decades, we’ve helped thousands of clients achieve their goals by offering the most comprehensive data, analysis and insight available. Our clients include a wide array of local, provincial, national and international financial institutions, real estate brokers, strata corporations, property managers, landlords, insurers, government agencies, investors, academics, homeowners and the media. From real estate valuation and analysis to land economics research and systems development, our staff of highly qualified experts are here to help you find solutions to your real estate analysis and data needs. Landcor maintains the largest, most comprehensive database of historical sales and current information on BC residential and commercial markets. Unlike MLS® data which includes only broker sales, Landcor’s data utilizes government land titles information which includes all registered sales – MLS® and nonMLS® – in British Columbia. Founded by Rudy Nielsen, R.I. (B.C.) F.R.I., Landcor is a wholly owned subsidiary of the NIHO Group of Companies. We’re providing this report in response to your interest in our company. The purpose is to provide marketwide trends for British Columbia based on available historical information. For further information on what Landcor can offer you and your business, contact Rudy Nielsen at 604-606-7914, or at [email protected]. For information about Landcor’s products and services, visit our website at www.landcor.com. Thank you for your interest in Landcor Data Corporation and have a great day.
Yours sincerely,
Rudy Nielsen, R.I. (B.C.) F.R.I. President & Founder
LANDCOR Data Corporation #200 - 313 Sixth Street New Westminster, BC Canada V3L 3A7
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Contact Rudy Nielsen R.I. (B.C.) FRI Tel: 604-606-7914 [email protected]
Q2 2008 Report Summary – Buyers remain in the driver’s seat. The numbers are in, and Landcor Data Corporation finds that the number of residential sales throughout the province continues to decline. In turn, this is causing the total value of residential sales to drop in all BC markets for the first time in five years. What does this mean for home buyers and sellers in BC? Landcor Data Corporation’s Q2 Residential Market Analysis found that: 1. Sales prices throughout the province have continued to adjust this quarter, with median price changes ranging from -3.8% to 15.6%, depending on the region and property type. Change in Median Sales Price, Q2 08 to Q1 08 • Greater Vancouver -0.2% to 3.4% • Okanagan -1.9% to 8.7% • Kootenays 1% to 7% • Fraser Valley -3.8% to 1.1% • Vancouver Island -3.5% to 3.8% • Northern BC 1.2% to 15.6% ~ Figures noted above are median price comparisons from Q2 08 to Q1 08, ranging by property type
2. The lack of affordable detached single-family homes has skewed buyer preferences in some regions. • Almost half (48%) of all residential home buyers in BC chose condominiums or attached homes, which is an increasing trend. • Nearly two thirds (63%) of buyers in Greater Vancouver chose condominiums or attached homes. • Almost half (47%) of all Fraser Valley area buyers chose condominiums or attached homes. 3. Out-of-province purchasers remain hesitant about investing in BC, with purchases from the United States and the rest of Canada (non-BC) down 24% since 2007. • However, Albertans made a come-back in the second quarter, up 36% over the total number of sales in Q1 08. After years of sky high prices, the market continues to cool, leaving buyers in the driver’s seat for another quarter. As buyers continue to be selective, it has become more difficult to sell your home. If you are selling your home or if you plan to: • Price smart – the market may be cooling, but homes that are properly priced will sell. • Market a quality product – make sure your home is at its best, since it has to be in the top 60% of homes on the market to move in a timely manner • Sell first and then go looking – if you do the opposite, you could be stuck with two mortgages, two sets of payments, two utility bills, two homes to keep up. Sell first and then buy. What lies ahead for us? With Federal, Municipal and American elections fast approaching, these are interesting times for our economy and real estate market. Will prices continue to adjust or will the market regain it’s footing in the coming months? Only time will tell and we will continue to keep you up-to-date in our following quarterly reports.
Stay tuned for more from Landcor Data Corporation Landcor is currently working on two more special reports: • Using the power of Landcor’s industry renowned Property Valuator, we will assess if there are pockets of negative equity in BC. • Using BC’s historic sales data unique to Landcor Data Corporation, we will analyze the impact of interest rate fluctuation on residential home sales since 1974.
-3-
www.landcor.com
Q2 2008 - Provincial Overview
Provincial Overview Total Number of Residential Sales in BC - First Half of Year
Total Number of Residential Sales in BC - Q1 and Q2
The total number of residential sales in BC is down in the first half of 2008 by 15.2% compared to the first half of 2007, from 75,788 to 64,268 total sales. This follows a 4.8% decrease from the previous year, and has now fallen below 2004 levels. Note: 2006 was a record year for residential property sales.
The total number of residential sales in BC is down in the second quarter of 2008 by 19.5% compared to the second quarter of 2007, from 45,459 to 36,612 total sales. Q1 08 was also down 8.8% vs Q1 07.
Total Residential Sales Volume in BC - First Half of Year
Total Residential Sales Volume in BC - Q1 and Q2
The total residential sales volume in BC is down in the first half of 2008 by 4.1% compared to the first half of 2007, from $28.59 billion to $27.4 billion in total sales volume. This follows a 10.5% increase over the previous year, and still well above 2006 levels. Note: 2007 was a record year for residential sales value.
The total residential sales volume in BC is down in the second quarter of 2008 by 11.6% compared to the second quarter of 2007, from $17.49 billion to $15.467 billion in total sales. This is the first decrease in total sales volume in the 5 years examined (since 2004). However, Q1 08 was up 7.6% over Q1 07.
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Q2 2008 - Provincial Overview
Total Number of Residential Sales by Property Type - Q2 per Year
All four property types saw the total number of residential sales decrease this quarter, compared to Q2 07. Detached and Vacant Land saw the greatest decrease, both over 23%. Condos saw the least change year over year, with a decrease of 12.2%.
Total Residential Sales Volume by Property Type - Q2 per Year
The total residential sales volume decreased in each of the four property type categories this quarter compared to last year. Vacant Land saw the greatest percentage decrease, at almost 24%. Condos saw the smallest decrease in total sales volume at 2.5%. Detached property sales volume was down a total of $1.26 billion (-12.8%) this quarter compared to Q2 2007 (which was a record year).
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Q2 2008 - Provincial Overview
% Change in Total Number of Sales & Sales Value by Region - Q2 08 vs Q2 07
Every region saw a dramatic drop in both volume and count in Q2 08 vs Q2 07. The largest drop, by percentage, was in Northern BC, where the volume and count are down 17% and 25%, respectively. Fraser Valley saw the smallest decrease at only 8% in volume and 14% in total sales count.
Stay tuned for more from Landcor Data Corporation Landcor is currently working on two more special reports: •
Using the power of Landcor’s industry renowned Property Valuator, we will assess if there are pockets of negative equity in BC.
•
Using the historic BC sales data unique to Landcor Data Corporation, we will analyze the impact of interest rate fluctuation on residential home sales since 1974.
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Q2 2008 - Provincial Overview
Total Number of Residential Sales by Region - Q2 per Year
Residential sales in Greater Vancouver slipped by over 2,900 in Q2 08 compared to Q2 07. The Okanagan saw a substantial slip as well, down over 2,000 sales. The Fraser Valley remained the most stable market, averaging around 5,000 sales in Q2 for the past 5 years.
% Change of Number of Residential Sales by Region - Q2 per Year
The Kootenays saw the largest percentage decrease in Q2 08 compared to Q2 07, at -28.56%. The Okanagan had a comparable decline at -26.44%. Fraser Valley and Greater Vancouver saw the smallest declines, both approximately -15% over Q2 07.
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Q2 2008 - Provincial Overview
Total Residential Sales Volume by Region - Q2 per Year
After seeing increases in every region in the second quarter of 2007, this year’s second quarter saw every region declining in total residential sales volume. Greater Vancouver was down by more than $1 billion this quarter, compared to last year. The Okanagan and Vancouver Island saw the second and third largest declines, both down more than $330 million over the same period last year.
% Change in Residential Sales Volume by Region - Q2 per Year
The largest decrease year over year occurred in BC Northern/Northwest, declining 17%; the smallest decrease was in Fraser Valley, at -8% over Q2 07. The Kootenays saw the greatest net change, going from a 36% increase in Q2 07 to a -11.84% decrease in Q2 08.
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Q2 2008 - Provincial Overview
Total Number of Residential Sales by Region - Q1 08 vs Q2 08
The total number of residential sales in BC is up across the province when compared to last quarter. Greater Vancouver had the greatest regional increase, up over 3,200 sales compared to Q1 08. The Kootenay region saw the smallest increase, up 649 sales over Q1 08.
% Change in Number of Residential Sales by Region - Q1 08 vs Q2 08
Every region in BC saw an increase of over 25% in the total number of sales in Q2 08 compared to Q1 08. The largest change was the Kootenay region, at over 62%, followed by BC Northern/Northwest at 56% and the Okanagan and Vancouver Island, both increasing around 34%.
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Q2 2008 - Provincial Overview
Total Residential Sales Volume by Region - Q1 08 vs Q2 08
Residential sales volume across the province is up in Q2 compared to Q1. Greater Vancouver saw more than a $1.5 billion increase in total sales volume over the previous quarter. Vancouver Island and the Okanagan both increased by more than $500 million. As the smallest region in the Province, the Kootenays saw the smallest Q2 increase over Q1 this year, gaining only $168 million in total sales over the previous quarter.
% Change in Total Residential Sales Volume by Region - Q1 08 vs Q2 08
The two regions with the smallest gains in total value saw the greatest percentage increase over last quarter – BC Northern/Northwest and the Kootenays, at 67.5% and 63.3%, respectively. The same is true on the other end of the spectrum, with Greater Vancouver seeing the smallest percentage increase over Q2 in total sales value, at 22%.
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Q2 2008 - Provincial Overview
Median Residential Sales Price in BC - Q1, Q2 & Half Year - per Year
Although the total sales counts and sales volumes are down in BC this quarter, median sales prices continued to increase this year. The median sales price of residential property in BC in the first half of 2008 is up $46,668 compared to 2007. Q1 08 is up over $60,000 since Q1 07, and Q2 08 is up almost $38,000 over Q2 07. The median sales price in BC is up about $3,000 in Q2 08 compared to Q1 08.
% Change in Median Residential Sales Price - Q2 vs Q1 per Year
The second quarter of 2008 saw median prices increase a meager 0.7% over Q1 08. In 2006 and 2007 BC’s residential real estate market posted Q2 median price gains of over 7%. This year’s performance remains slightly above 2004’s Q2 vs Q1 change of -0.03%.
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Q2 2008 - Regional Overview - Median Sales Price Fraser Valley Median Sales Price by Property Type - Q2 08 vs Q1 08
The Fraser Valley has seen little change in the median prices of residential properties in Q2 08 compared to Q1 08. Attached home median sales price remained the same, while detached increased by $5,000 and condos dropped by $9,000 over the previous quarter.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached homes were the only property category to post an increase in sale price in the Fraser Valley, rising a meager 1%.
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Q2 2008 - Regional Overview - Median Sales Price Greater Vancouver Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached homes in Greater Vancouver increased $20,500 in median price over the previous quarter, followed by attached homes at $13,430. Condos headed in the other direction, slipping slightly by $550 over Q1 08’s median sales price.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached and attached home median sales prices both rose 3% in Q2 08 compared to Q1 08.
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Q2 2008 - Regional Overview - Median Sales Price Kootenay Median Sales Price by Property Type - Q2 08 vs Q1 08
The Kootenays saw all three property types increase in value this quarter compared to Q1, but all net out in the mid-high $200K range. There is less than a $23,000 difference between the median sales price of a detached home and a condo in the Kootenay region this quarter.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached gained a slight 1% over the previous quarter’s median sales price, while attached prices gained 7% and condos almost 5%.
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Q2 2008 - Regional Overview - Median Sales Price BC Northern/Northwest Median Sales Price by Property Type - Q2 08 vs Q1 08
The most affordable market in BC is again the Northern region, where the median sales price of a detached home remains under $250,000. This causes the majority of buyers to select detached homes, which increased less than $2,500. Condos and attached homes, which have less supply and demand here, increased $15,900 and $13,250 over the previous quarter’s median sales price, respectively.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
The largest median sales price quarterly percentage increase in the North this quarter was condos, up 15.6%. Attached homes were up just under 9%, while detached held steady with an increase of only 1%.
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Q2 2008 - Regional Overview - Median Sales Price Okanagan Median Sales Price by Property Type - Q2 08 vs Q1 08
Condos in the Okanagan gained an impressive $22,395 over the previous quarter’s median sales price. Detached followed at $7,750 and attached took a dip, losing $6,300 in value.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
The median sales price of Okanagan condos increased nearly 9% in Q2 08, while detached and attached homes gained and lost 2%, respectively.
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Q2 2008 - Regional Overview - Median Sales Price Vancouver Island Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached home sale prices made the largest gains in Q2 08, increasing $15,100 over the previous quarter. Condos dipped $10,000 and attached remained nearly the same, up only $1,000. Prices on Vancouver Island are very similar to those in the Okanagan.
% Change in Median Sales Price by Property Type - Q2 08 vs Q1 08
Detached and condos gained and lost almost 4%, respectively, while attached posted an increase less than 1%.
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Q2 2008 - Property Type Preferences
Property Type Preferences
We were interested to see if the property type preferences of residential property purchasers had changed across the province this quarter. With the sky high price of detached homes, we decided to examine whether people have turned to more affordable options, such as condos and attached homes.
Share of Purchases - Detached homes vs Attached and Condos - BC ALL
We found that overall in BC, people had a slight preference for detached homes, accounting for 52% of total residential sales in BC this quarter. As illustrated above, this preference is depleting year over year, mainly influenced by the decreasing affordability of detached homes in most areas of BC.
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Q2 2008 - Property Type Preferences
Share of Purchases - Detached homes vs Attached and Condos - Fraser Valley
As house prices have increased in the Fraser Valley, it is evident that the preference for detached homes has slipped from 65.26% of all homes purchased in Q2 2004 to 52.51% in Q2 08. In Q2 08 there were 555 less detached homes sold in the Fraser Valley, while attached homes and condos increased by 74 purchases, compared to Q2 07.
Share of Purchases - Detached homes vs Attached and Condos - Greater Vancouver
As may be expected, condos and attached homes account for the majority of residential property purchases in Greater Vancouver. The decreasing affordability of detached homes is forcing families to purchase attached homes and condos, rather than detached properties. In the second quarter of 2008, almost 63% of purchases were attached homes and condos while detached homes accounted for only 37% of all purchases.
Share of Purchases - Detached homes vs Attached and Condos - Kootenays
With more reasonable detached home prices in the Kootenay region, 64% of residential property purchases in Q2 08 were detached homes. Though only 36% of purchases this quarter were condos, this segment has increased year over year in popularity.
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Q2 2008 - Property Type Preferences Share of Purchases - Detached homes vs Attached and Condos - Northern BC
Due to the lack of condo inventory in the North and the affordability of detached homes, the vast majority of residential purchases in Q2 08 were detached homes – a trend that has remained constant from previous years.
Share of Purchases - Detached homes vs Attached and Condos - Okanagan
In the Okanagan region, condos are growing in popularity, though they still do not account for the majority of residential property purchases. 62% of sales in Q2 08 were for detached homes.
Share of Detached homes vs Attached and Condos - Vancouver Island
Residential property purchasers on Vancouver Island maintain a strong preference for detached homes, with over 66% of residential purchases in Q2 08 being detached homes.
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Q2 2008 - Out-of-Province Sales Overview Out-of-Province Buyers Total Number of Residential Sales Purchased from Outside of BC - Q2 08 vs Q2 07
Out-of-province purchases are down in Q2 08 from US and Canadian investors. Alberta remains the largest out-of-province purchaser of BC property. Due to a change in currency values and a declining US economy, purchases from the United States are down 40% in Q2 08 compared to Q2 07. Alberta and Ontario buyers have also declined by 21.52% and 28.19%, respectively.
Total Number of Residential Sales Purchased from Outside of BC - Q2 08 vs Q1 08
Comparing the first two quarters of 2008, Alberta purchases have increased by 348. Purchases from the United States have remained steady, while Ontario buyers decreased slightly.
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Q2 2008 - Out-of-Province Sales Overview
Total Value of Residential Purchases from Outside of BC - Q2 08 vs Q2 07
The total value of out-of-province purchases is down in the second quarter of 2008 compared to the same quarter in 2007. Though they spent less in Q2 08 compared to the previous year, Albertans still spent close to a half of a billion dollars in BC this quarter. US buyers, however, spent almost half of what they did the previous year.
Total Value of Residential Purchases from Outside of BC - Q2 08 vs Q2 07
Comparing the first two quarters of 2008, the total value of Alberta purchases has increased by $113 million.
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Q2 2008 - Out-of-Province Sales Overview
Alberta Buyers Total Number of Residential Purchases by Albertans by Property Type - Q2 08 vs Q2 07
Of those properties purchased by Albertans in Q2 08, buyers preferred condos. This property type was the only one to increase in total number purchased in Q2 08 compared to Q2 07.
Total Value of Residential Purchases by Albertans by Property Type - Q2 08 vs Q2 07
Alberta purchasers spent more on BC condos than they did on detached homes this year. Another shift in purchase preference is Vacant Land—declining 46% in Q2 08 compared to Q1 08.
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Q2 2008 - Out-of-Province Sales Overview
Total Number of Residential Purchases by Albertans by Property Type - Q2 08 vs Q1 08
Of those BC properties purchased by Albertans this quarter, buyers preferred condos. Vacant Land and detached homes were also scooped up by Albertans this quarter.
Total Value of Residential Purchases by Albertans by Property Type - Q2 08 vs Q1 08
Albertans spent 63% more on condos and 42% more on detached homes in BC this quarter compared to Q1. Their investment in BC’s vacant land decreased 19% in Q2 08 compared to Q1 08.
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Q2 2008 - Out-of-Province Sales Overview
Location of BC Properties Purchased by Albertans - by Region - Q2 08 vs Q1 08
Alberta purchasers in Q2 08 focused their investment in the Kootenay and Okanagan regions. Surprisingly, Fraser Valley out-of-province purchases dropped off compared to the Q1 08, decreasing 63%.
Location of BC Properties Purchased by Albertans - Q2 08
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Summary
Glossary of Terms
BC’s residential real estate market continues to find its footing this quarter, with the number and value of residential sales slipping across the province. When compared to Q1 08 residential sale prices, median sale prices in Q2 made only moderate gains, and in some areas even declined.
Apartment:
Despite this recent breather in BC’s residential market, potential buyers still experienced difficulties in finding affordable single family homes in some regions, causing property preferences to shift to more inexpensive options, such as condos and attached homes.
A single-family occupied home located within a building containing multiple units. Also known as a condominium. Landcor uses the BC Assessment field Actual Use Type code 30 strata-lot residence (condominium).
Attached home:
A single-family occupied home attached by a common wall or walls to other like homes. Landcor uses the BC Assessment fields Actual Use Type 33, 34,35, 39, 47, 49, 36, and 41; including row housing, duplex, triplex, and fourplex structures.
In addition, out-of-province purchasers continued to stay home, with a trend of lower sales when compared to previous years. However, interest from Alberta picked up in the second quarter of 2008, with higher sale figures than the previous quarter.
Average price (also known as the mean):
With political change on the horizon, the immediate future remains uncertain. However, trust Landcor to keep you up-to-date with accurate, timely data on BC’s ever changing real estate market.
A free-standing single family residential building, also known as a Single Family Dwelling. Landcor uses the BC Assessment Actual Use Type codes 0, 32, and 60; including those single family dwellings, without or with basements, or less than or more than 2 acres of land.
Methodology Landcor maintains the largest and most comprehensive database of historical sales and current information on the BC residential and commercial markets. Using proprietary tools, Landcor staff analyze this information to provide a clear understanding of the market. All sales data encompass only arms-length transactions. This report is the summary of all second quarter sales transactions occurring in the province of BC between April 1st to June 30th of each year analyzed. All numbers are based on BC Assessment’s data available as of August 12th, 2008.
The price that results when all prices of properties in a given area over a specific time period are added and then divided by the number of properties in the distribution.
Detached home:
Median price:
The price that is midway between the least expensive and most expensive property sold in a geographic area during a specific time period. Half of all property buyers paid more than the median price and half paid less than the median price.
Other residential:
For information about the real estate market and trends, visit www.landcor.com.
Residential properties that do not fit within the other defined residential property types. Landcor uses BC Assessment Actual Use Type codes 20, 19, 31, 37, 38, 40, 42, 43, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 62, 63; including all residential outbuildings, stratalot residential parking and self-storage, manufactured homes, seasonal dwellings, multi-family buildings, stratified rental townhouses or apartments and seasonal dwelling and manufactured homes on 2 acres or more.
Questions and inquiries
Vacant Land:
Learn more
For questions about this report, or for consultation inquiries, contact Rudy Nielsen, President and Founder of Landcor Data Corporation at 604-606-7914 or [email protected].
Property that does not contain a building structure. Landcor uses the BC Assessment Actual Use Type codes 1 and 61; including vacant land less than, equal to or greater than 2 acres in size.
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Regional Boundaries Greater Vancouver: includes assessment area codes 8, 9, 10, 11, and 14 Vancouver Island: includes assessment area codes 1, 4, and 6 Thompson Okanagan: includes assessment area codes 17, 19, 20, and 23 Fraser Valley: includes assessment area code 15 Northern BC: includes assessment area codes 24, 25, 26, and 27 Kootenay: includes assessment area codes 21 and 22
Northern BC
Fraser Valley
Greater Vancouver
Thompson Okanagan
Vancouver Island
Kootenays
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LANDCOR Data Corporation #200 - 313 Sixth Street New Westminster, BC Canada V3L 3A7 604-606-7914 www.landcor.com
This report is provided by Landcor Data Corporation (“Landcor”) as a courtesy for general information purposes. Because the data in this report is provided to Landcor by the British Columbia Government and its various agencies, Landcor has no control over the accuracy of the data. The information in this document (the “content”) is therefore provided “as is” and “as available”. The content is provided without warranties of any kind, either express or implied, including, but not limited to, implied warranties of merchantability, fitness for a particular purpose, or noninfringement. Landcor, its subsidiaries, or its licensors are not liable for any direct, indirect, punitive, incidental, special or consequential damages that result from the use of this content. This limitation applies whether the alleged liability is based on contract, tort, negligence, strict liability or any other basis, even if Landcor has been advised of the possibility of such damage. Because some jurisdictions do not allow the exclusion or limitation of incidental or consequential damages, Landcor’s liability in such jurisdictions shall be limited to the extent permitted by law. © 2008. All information herein is intended for information purposes only. While this information is believed to be correct, it is represented subject to errors, omissions, changes or withdrawal without notice.
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