August 2017 Housing Charts: a break from the 2013 pattern

Submitted by Rich Toscano on September 16, 2017 - 3:19pm
Hey all, mostly graphs this month but I did want to call out one interesting development.  Thus far, this year has been strikingly similar to 2013 in terms of months of inventory. But the pattern seemed to diverge last month -- and not in a way that buyers will like:

We shall see if this disparity continues. If so, it will argue for accelerating prices immediately ahead, notwithstanding the typical fall lull. This chart looks pretty (short-term) price bullish too:

Many more graphs below...

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Submitted by spdrun on September 16, 2017 - 3:42pm.

Interesting that condos have fallen sharply two months in a row. Are higher and lower ends of the market diverging?

Anyway, 10% fall in condo prices in ~2 months (basically, erasure of the y-o-y gains) is a good start ... hope the salutary trend continues.

Submitted by Rich Toscano on September 16, 2017 - 4:23pm.

The condo data is too volatile to be of much use... "noise" is a more likely explanation than a divergence between high and low end.

Submitted by gzz on September 17, 2017 - 11:45am.

Official 4 year seasonal low in active ex-C inventory, and still healthy sales.

Spd, Condos are up 6% YoY.

7-8% is the new normal and reflects rent increases, lack of good alternatives investments, and scarcity.

Submitted by Escoguy on September 22, 2017 - 9:04pm.

If one extrapolates the peak in annual resale inventory, in 5 years, there may only be 3,000 homes for sale during the peak late summer period, which relative to population would be even lower months of inventory. The lows of the year may be below 2,000 available which really isn't much to choose from.

Personal theory is that several hundred homes enter the permanent investment property category every year given the numerous tax benefits, rising rents and relatively poor comparable investment alternatives.

We have a long way to go to reach a true bubble like Toronto was earlier this year or Vancouver but I guess anything is possible. Oddly, in the era of bitcoin, having an asset that only appreciates by 5-7%/yoy seems very modest and conservative.

Do we have any demographic info on the age of the "free and clear" homeowner, thinking about the scenario where perhaps the kids have grown up/out and now they inherit the property. I'm guessing in many cases the correct economic decision would be to rent it out or move in to use for ones own needs (after parents pass away).

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