housing
05. housing
Almost all housing markets across the country have been experiencing diminishing supply over the past year—even, in some cases, as sales counts rise.
EVALUATING THE SALES-INVENTORY CONTINUUM
In discussions and evaluations of our housing market, we operate almost as if housing demand (as measured by sales) and housing supply (as measured by inventory, or total listings) are mutually exclusive. In fact they are not mutually exclusive, either conceptually or mathematically. In simple terms and assuming all else being equal (a classic economist assumption), higher levels of sales counts are associated with lower inventory levels (because the sales draw inventory down), and vice versa. The lynchpin in the dynamic between housing supply and demand, then, is new listings activity: if sales are robust but new listing counts are even more so, then a market can certainly feature both rising sales counts and rising inventory. Alas, the recent scenario that has characterized our housing market here in Metro Vancouver,
and in many markets across the country, has been one of historically-high sales counts and completely depleted inventory. For the Vancouver Region as a whole (which combines the Greater Vancouver and Fraser Valley estate boards), there have been 72,360 MLS sales over the past 12 months (through August 2021)—the most in any 12-month period in our region’s history. The year-over-year change in sales counts in this region have begun to moderate in recent months, especially in the Fraser Valley, but inventory remains historically constrained: the 12,871 listings in August, for example, were the fewest in any August in the region’s history. For now, high sales activity does seem to be inhibiting available supply. Expect this dynamic to change (at the margin) through the fall, however, as rising new listings help to bring a modicum of balance to our market.
36
rennie.com
Made with FlippingBook - professional solution for displaying marketing and sales documents online