METRO VANCOUVER

Sales dip surprises; plentiful supply; BoC rate cut – finally!

Following recent monthly increases in the Metro Vancouver residential market, May’s home sales showed a slight drop in a period when spring sales activity normally picks up. While the current dip was unexpected, last month’s sales weres down significantly by 19.6% from the 10-year seasonal average. However, viewed through a micro rather than macro lens., the month-over-month decline is less dramatic. May’s sales of 2,733 homes was a 3.5% drop from the preceding April total of 2,831. New listings last month also declined from the preceding month, with May’s total of 6,374 homes representing a 10% drop from the 7,092 new listings in April. On the historical comparison for this month, however, this was a solid showing, 12.6% higher than the same per period one year ago and 7.0% higher than the 10-year seasonal average.  With the decline in sales, the new listings left Metro Vancouver’s residential market with a healthy inventory at the end of May with a total of 13,600 available homes across all property types. The Metro Vancouver market is still settling into balance after exuberant purchasing during a period of Covid-incentivized low interest rates, then followed Bank of Canada inflation fighting rate increases cooling demand through higher mortgage costs. It was welcome news, therefore, when Canada’s central bank announced last week its first interest rate cut in four years, lowering the key policy rate from 5.0% to 4.75%, which should be followed in turn with lower mortgage rates. The reaction by financial markets suggests that further cuts will be coming later this year, with several leading economists predicting another two 25 basis points cuts  to bring the central bank policy rate to 4.25% by the end of the year. Bank of Canada Governor Tiff Macklin noted in last week’s announcement that he has increased confidence that Canada’s inflation rate is now headed sustainably toward its 2.0% target. Canada’s consumer price index inflation rate in April was 2.7%. With the lower interest rates, it is expected that demand will begin to rise, thus putting further upward pressure on prices. At the end of May, the composite benchmark price for a residential property in Greater Vancouver was $1,212,000, a 0.5% increase over the preceding month.   

In section below, you will find our monthly guide to benchmark prices and their monthly changes in different areas around Metro Vancouver at the end of May. Each benchmark, representing the overall average price for comparable homes of a particular property type, has the three closest average prices on each side of the benchmark for different geographical areas The month-over-month price change is typically influenced by the demand fluctuations in the area. The extremities of each benchmark is provided to show the upper and lower prices making up the average. It is important to remember that underlying the averages, there may be individual prices that you may find more attractive. If you are interested in exploring homes for sale in a particular neighbourhood, please don’t hesitate to give me a call. I can provide you with the most up-to-date prices and assist you with your home search. And if you are thinking of listing your home, I can prepare a Customized Market Analysis for your property and help you set the optimal asking price in the current market. Please let me know what I can do to assist you. I love to help my clients.    

Detached homes

The benchmark price for a single-family detached home in Metro Vancouver at the end of May was $2,062,600, an increase of 1.3% from the preceding month. The extremities of this average were Vancouver West at $3,548,900 and Sunshine Coast at $912,200. The three municipalities closest to the benchmark on the higher side of the average were: Burnaby North at $2,154,100, an increase of 1.8% from the preceding month; Port Moody at $2,171,400, an increase of 1.0% from the preceding month; and Richmond at $2,218,600, an increase of 0.5% from the preceding month. The three municipalities closest to the benchmark on the lower side of the average were: Vancouver East at $1,879,000, an increase of 1.0% from the preceding month; Coquitlam at $1,854,400, an increase of  0.4% from the preceding month; and Tsawwassen at $1,667,300 a decrease of 0.6% from the preceding month.

 

Townhouses

The benchmark price for a townhouse in Metro Vancouver at the end of May was $1,145,500, an increase of 0.9% from the preceding month. The extremities of this average were Whistler at $1,815,400 and Sunshine Coast at $791,500. The three municipalities closest to the benchmark on the higher side of the average were: Richmond at $1,169,400, an increase of 1.3% from the preceding month; North Vancouver at $1,426,500, an increase of 2.8% from the preceding month; and Vancouver West (Squamish is omitted here because it is too far out for my clients) at $1,492,200, an increase of 0.9% from the preceding month. (The three municipalities closest to the benchmark on the lower side of the average were: Vancouver East at $1,134,500, a decrease of 0.1% from the preceding month; Coquitlam at $1,096,900, an increase of 1.5% from the preceding month; and Tsawwassen at $1,020,400, an increase of 0.2% from the preceding month.

Condominiums                           

 

The benchmark price for a condominium in Metro Vancouver at the end of May was $776,200, a decrease of 0.3% from the preceding month. The extremities of this average were West Vancouver at $1,341,100 and Maple Ridge at $543,200. The three municipalities closest to the benchmark on the higher side of the average were: Burnaby East $811,800 a decrease of 0.3% from the preceding month; North Vancouver at $823,600, no change from the preceding month; and Vancouver West at $844,300, a decrease of 0.9 % from the preceding month. The three municipalities closest to the benchmark on the lower side of the average were: Richmond at $764,900, a decrease of 1.3% from the preceding month; Burnaby North at $759,400, a decrease of 1.3% from the preceding month; and Coquitlam at $751,900, a decrease of 0.4% from the preceding month.

 

Let me help

 

These are challenging times for home buyers and homeowners. With higher mortgage interest rates, you may need to adjust your financial strategy for your home purchase. If you need help in managing your home ownership plans, I can help. I have post-graduate education in business along with years of experience in both banking and real estate. I am happy to help in any way I can. I want my clients to achieve their goals. Please don’t hesitate to call me.