Happy New Year everyone.
The very first thing to talk about in 2009 is 2008. It was quite a year, and this post is an end-of-the-year report of pre-owned single family home sales activity. The report covers two years, ending December 31, 2008, and covers used homes located in the core area of Victoria (Victoria, Oak Bay, Esquimalt, View Royal, and Saanich).
The year-to-year trend continues - yearly listings are up somewhat (up to 3,666 from 3,387), and yearly sales are markedly down (dropping to 1,851 from 2,413). These changes are summarized in the Year Over Year Comparison (Chart 1) and the Three Month Comparison Charts (Chart 2), below.
The chart to the right shows (Chart 3) shows the total (cumulative) 12-month listings and sales for each month during the past year. In effect, the lines on this graph are trend lines. No change in trend is evident.
Chart 4 below is an overview of listings and sales each month for the past 24 months. It’s a bit surprising to me that the number of listings bounced back in December from November lows (at least for pre-owned single family homes) - I would have bet that December would have seen the bottoming out of listings, but this year, November takes that honour. However, sales continued their downward slide.
The next three charts involve prices, all measured monthly as well as a three month rolling average. Chart 5 shows median selling price (see my earlier article - Median Home Values Explained if you aren’t familiar with median price). Chart 6 depicts average prices. And finally, Chart 7 compares average selling prices with assessed values for the corresponding period.
The three month median price rolling average dropped to $518,600 in December from its recent high of $589,900 in May, a decline of 12.1%.
The three month rolling value of the average selling price dropped to $561,900 in December from its recent high of $662,200 in May, a decline of about 15.3%.
chart 7 shows that the monthly sold-to-assessed multiple was constant for the last three months, and that the three month rolling average for this ratio has reached the monthly value of 1.04.
A few more words about Chart 7: I mentioned last month that the BC government announced it would use last year’s assessed value for 2009 too. Today’s Victoria Times Colonist reported a nuance on this that I missed earlier. If the BC Assessment Authority determines that the actual assessed value of a property as of July 2008 is less than the assessed value one year earlier (as of July 2007), the July 2008 value will be used. Otherwise, the July 2007 assessed value will be carried forward.
The final four graphs are based on statistics which may help gain further insight into market performance and trends.
I’m not convinced that ‘Days On Market’ before sale is a reliable barometer of much. Nevertheless, the trend line since May 2008 is sloping unmistakenly in the direction of longer sales times.
The final three charts show a strong correlation: since March 2008, they all indicate a trend toward a buyer’s market.
Chart 11 is very interesting, with its strikingly sharp increase in the percentage of price reductions.
Does this increase in the percentage of price reductions suggest the possibility of a changing mindset? That is, is it possible that in December owners began to accept that the heady ’seller’s market’ of just a few months ago has become a buyer’s market? Maybe so, when you consider that the ’sold-to-listed’ ratio went from 34% in October to 47% in November to 66% in December.
In summary, there is no indication whatever in December’s charts to suggest the downward trends in prices and sales volumes have changed. But maybe, just maybe, we have seen the beginning of an acceptance of that fact by those who wish to sell their homes.
Bye for now,
...Victoria's blogging real estate professional.
Tags: Victoria Home Market Report, Victoria Property Values, Victoria Real Estate
