“There are over 5,000 homes in Vancouver for sale for over $1 million. In comparison, in April, just over 7,000 homes sold in the entire US (135 times the population) for over $1 million.”

“There are currently over 5,000 homes in Vancouver metro area for sale for over $1 million according to MLS.ca. In comparison, the NAR reports that in April, just over 7,000 homes sold in the entire US were sold for over $1 million. And this despite the fact that the US population is 135X greater than the metro Vancouver market, the average personal disposable income in the US is 20% higher than the Vancouver average ($37,100 vs. $30,800) while US per capita GDP is higher than the average for all of BC.”
– from Vancouver housing in full correction mode: Implications for Canadian banks, Ben Rabidoux, The Economic Analyst, 3 Aug 2012

Truly remarkable. Thanks to Ben for that insight.
– vreaa

30 responses to ““There are over 5,000 homes in Vancouver for sale for over $1 million. In comparison, in April, just over 7,000 homes sold in the entire US (135 times the population) for over $1 million.”

  1. It’s amazing how 1 million dollars was a lot of money just 10 years ago. Now, it’s like, if you don’t own a million dollar home you’re probably considered poor in this city.

  2. The Toronto area has about half as many:

    http://tinyurl.com/cepgnz5

  3. Dimitri Tishchenko

    Winter is coming…

    • The Poster Formerly Known as Anonymous

      The White-Walkers are coming with it.

      • is that a reference to the walking dead ?

      • This should help clear it up……..

        “The White Walkers, referred to as the Others in the books, are a mythological race mentioned in ancient legends and stories from the time of the First Men and the Children of the Forest. Eight thousand years before Robert’s Rebellion, a winter known as the Long Night lasted a generation. In the darkness and cold of the Long Night, the White Walkers descended. None knew why they came, but they killed all in their path, reanimating the dead as wights to kill the living at their command”.

  4. pricedoutfornow

    Good luck to Vancouver homeowners. This train is about to be in a wreck.

  5. The Poster Formerly Known As Anonymous

    All we need now are over 5,000 HAM families to buy over the internet or by heli-remote, and we’ll be saved!

    Or, alternatively, we could lower interest rates and raise ammortization periods so that first time buyers can buy all the 400,000 condos so the 400,000 condo owners can buy all the 700,000 houses so the 700,000 house owners can move up to the 1 Million plus houses, and we’ll be saved!

    Oh. But what about the 20,000 brand new and unsold condos coming soon?

    We could offer second time homeowner investor grants so that they can buy them all up, and rent them out! Then all we need is another 6,000 immigrant families to fill them. Shouldn’t be a problem; this is the best place on Earth and everyone wants to come here and rent!

    I’m bullish on Vancouver Real Estate.

    • Dimitri Tishchenko

      Haha. If it worked in 2008, I don’t see why it can’t work now. 50 year amortization, zero down.

      • van east guy

        With changes like that, sfh prices will reach a 2 mil avg for Van. That’ll be pretty fucked up.D

      • Make it 60 year amortization, interest only, plus 60 years fixed mortgage. Hell, have the homeowner buy life insurance to cover the original amount of mortgage. Their second generation will not have to worry about housing anymore….

      • As we all know, homeowners already have 20+ subsidies. The ironic part is the subsidy goes to the Developers not the actual homeowner (flow through prices raises). If you want to actually subsidize these second time homeowners you have to give the RENTER a subsidy, because then disposable cash increases and then rents can be increased without your tenant leaving. As a renter I’m thankful everyday that renters have 0 subsidies compared to homeowners because it keeps rent prices low. Bailout us renters? HELL NO.

  6. Haven’t they heard, $999,999 is the magic number these days.

  7. 4SlicesofCheese

    Although the numbers are shocking, you have to take into account that 5000 are FOR SALE in Vancouver and 7000 SOLD for over a million in the states.

    Actually never mind that still is ridiculous hahaha.

  8. Speaking of US sales over a Mill…

    [TMZ] – Michael Phelps DUMPS Baltimore Condo At $400,000 Loss

    …”Michael Phelps didn’t just take a beating in the 200m butterfly recently … he also got his ASS kicked by the real estate market — letting go of his swank Baltimore condo for $400,000 less than what he bought it for.

    Phelps purchased the 4,080 sq. ft. home in Fells Point back in 2007 for $1.69 million — but then the housing market crashed … and so did the value of his home.

    The 19-medal-winning swimmer listed the 3-bedroom pad earlier this year for $1.42 million — but even that was asking too much … because when he finally sold the place last week … he could only get $1.25 mill.”…

    http://tinyurl.com/brb3s5s

    [NoteToEd: Win some lose some.]

  9. The average income statistic is misleading. Here in Canada we are more than happy to work harder to provide a paycheque every two weeks for those that choose not to work. We have a lot of “stay at home yada yadas” they just don’t necessarily live in the same house as the person earning income.
    Otherwise, the stat of the US vs Vancouver total listings is very telling.

  10. In the JustForFun, SaturdayMorning Comps category [or, to put it another way, ignoring for the moment the self-evident pleasures of an owning an EastSide CrackShack… what would your Million and PocketChange buy you somewhere else?]…

    [FT] – Head v Heart: With £700,000 to spare where would you pick a property?

    …”Charles Weston Baker, head of residential development at Savills, thinks investment potential from maisons fatales comes down to how remote the property is: “A beautiful farm in rural Italy, maybe an hour’s drive from a city or holiday destination, can do very well. But if the property is very remote and a hassle to get to, it’s unlikely to appreciate no matter how beautiful it is,” he says. “One client bought 316 sq miles of forest in western Canada. There were no buildings on the land, just trees – he absolutely fell in love with the beauty of the place.” When the client died, finding a buyer was a difficult process…. So, if you’re wondering where to invest once the summer is over, perhaps you should have a look through these property options before you start analysing the futures market or book that flight to Las Vegas.”…

    http://tinyurl.com/bt6dmkc

  11. EconomicAnalyst Ben Rabidoux +2
    spells gloom and doom for British Columbians because of high debt levels and relative population rates in urban areas.

    In the comments section , the heavily indebted homeowner appears to be playing his ‘Bernanke Put’ by relying on CMHC –> BofC to honor insurance protocol on mortgage default

  12. So when Ben says…

    “Deposits at federally regulated financial institutions are insured by the Canadian Deposit Insurance corporation, a federal crown corporation. However, deposits at credit unions are guaranteed by the provinces. Credit unions in Canada are not as tightly regulated as federally regulated banks yet they are very active in the mortgage market, particularly in BC and Quebec.

    Few analysts cover them extensively since they aren’t publicly traded but all analysts I’ve spoken to express some concern about the fate of credit unions, particularly in BC, in the event of a sustained housing correction coupled with rising unemployment and delinquencies. This is particularly concerning once we consider that BC guarantees $45B in insured deposits, the equivalent of 23% of GDP.”

    Does that mean I should be worried about my Vancity Credit Union deposits?

    • Have you taken a careful (fine-print) look at who insures the deposits and the degree to which they are insured?

      • I have never found the information on the Vancity site. Almost half a year ago when I started looking into finances and RE and so on, I was driven to look into deposit insurance in the fear that Canada will undergo a bad depression/great recession (thanks to the precursors in Europe) that would result in hyper-inflation or deflation and banks failing. Basically Armageddon. I’m not sure I support that view fully right now.

        Anyhow, what I did find that was there was an organization named the Credit Union Deposit Insurance Corporation (CUDIC). http://www.cudicbc.ca/

        In November 2008, the Province passed legislation to provide unlimited deposit insurance (not just up to the first $100k) on all deposits in BC’s credit unions. Vancity is a member.

        It seems like CUDIC is part of FICOM which oversees a bunch of FIRE industries in BC. (RE, Mortgage Brokers, Strata properties, Insurance, …)

        So my take on it, would be that the BC gov’t through CUDIC will most likely pay the full amount on the deposits, but would ask non “risk-free” financial vehicles (e.g. bonds) to be restructured if they have trouble paying down debt. If a lot of credit unions undergo failure or distress, I would imagine they would quietly re-write or revert the unlimited deposits legislation quickly.

        But otherwise I have no idea. I don’t even know how most financial institutes work these days (perhaps not very many people do either though…).

        Of course any insight into those would be awesome.

  13. Pingback: Ben Rabidoux Reviews the Status and Implications of the Vancouver RE Market | Vancouver Real Estate Anecdote Archive

  14. That is somewhat true that most of the international buyers put down hefty down payment making them exempt from the new rules. However, with crises at home, far fewer of them are coming here to buy real estates. They are also the first one to leave town when they need funds back home. When they dump their investment in Canada, watch out below…

    That said, the current government policy does not protect the Canadian born citizens as it allow foreigners to drive up the housing prices, thus local with more than average earnings cannot even afford a decent place to live in their home town. .

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