METRO VANCOUVER

Sales decline as rate hikes continue; early signs of rising prices

Metro Vancouver’s residential market saw another month of last month. Home sales this past October dropped 12.8% from the preceding September to a total of 1,904. This continues the downward trend seen since the current series of mortgage rate increases began last spring when the Bank of Canada’s inflation-fighting policy rates commenced in March. However, to put the past seven months of lower sales volume in perspective, it must be noted that the decline is relative to the record high volumes recorded last year as pandemic-induced low interest rates fuelled historically high sales levels. The Bank of Canada’s most recent policy rate increase of 50 percentage points in late October has now raised the key rate to  3.75%. Current mortgage rates based on the central bank rate are near 5.0% for fixed five-year mortgages with some variable rates about 25 percentage points lower. While the slowing of home sales is part of the Bank of Canada’s goal of cooling the overheated residential market, prices have generally dropped to levels attractive to buyers who are able to qualify for higher mortgage rates. Last month there were 4.033 new listings in Metro Vancouver, almost the same rate for new listings for the same period one year ago, although a 4.6% decline from the preceding month. With the lower sales volume, however, the available housing supply has been able to grow, reaching 9,852 available properties at the end of October. This is an ample supply providing an excellent selection of homes for buyers at this time, and there are now signs that prices are beginning to edge upwards again. The composite residential benchmark price in Metro Vancouver at the end of October was down 11.7% from six months ago. At the end of October this benchmark price was $1,148,900, a mere 0.6% down from the  preceding month.

For a comparison of benchmark prices across different geographical areas in Metro Vancouver, please view the month-over-month price changes in the selection below. In this month’s analysis, as mentioned above, there are some notable price increases, mainly in townhouses and condominiums. This may be a sign of prices now finding their floor after declines for several months. The selected municipalities show their closest average prices on the upper and lower sides of the benchmark for each property type. For each of the property types, October sales were led by condominiums with a total of 995 or 23.2% of listings in the category; detached homes followed with a total of 575 or 14.3% of the category listings; and townhouses with a total of 333 or 21.6% of the category listings. It is important to keep in mind when looking at the benchmarks that these are averages made up of a range of prices. There are often individual prices that represent excellent bargains concealed in the averages. If you would like more detailed information on your preferred neighbourhood, I am happy to provide you with the most up to-date information on the market for your purchase offer. And for anyone thinking about listing, I can prepare a customized market analysis of your property and advise you on the optimal listing price for the current market demand.  Please don’t hesitate to call. I am always eager to help my clients in any way I can.       

Detached homes

The benchmark price for a single-family detached home in Metro Vancouver at the end of October was $1,882,100, a decrease of 0.7% from the preceding month. The extremities of this average were West Vancouver at $3,317,500 and Sunshine Coast at $917,000.  The three municipalities closest to the benchmark on the higher side of the average were: Burnaby North at $1,946,300, a decrease of 0.6% from the preceding month; Port Moody at $2,029,800 a decrease of 2.1% from the preceding month; and Richmond at $2,053,800, a decrease of 1.3% from the preceding month. The three municipalities closest to the benchmark on the lower side  of the average were: Burnaby East at $1,826,700, an increase of 2.3% from the preceding month; Coquitlam at $1,750,400, a decrease of 1.6% from the preceding month; and Vancouver East at $1,700,100 a decrease of 1.3% from the preceding month.

Townhouses

 

The benchmark price for a townhouse in Metro Vancouver at the end of October was $1,043,600 a decrease of 0.5% from the preceding month. The extremities of this average were Vancouver West (not West Vancouver) at $1,477,700 and Sunshine Coast at $718,500. The three municipalities closest to the benchmark on the higher side of the average were: Richmond at $1,058,300, an increase of 0.8% from the preceding month; North Vancouver at $1,230,600, an increase of 3.4% from the preceding month; and Vancouver West at $1,477,700, an increase of 1.5% from the preceding month; The three municipalities closest to the benchmark on the lower side of the average were: Vancouver East at $1,028,500 a decrease of 3.9% from the preceding month; Port Moody at $1.021,600 a decrease of 2.0% from the preceding month; and Coquitlam  at $1.014,600, a decrease of 1.7% from the preceding month.

Condominiums                           

 

The benchmark price for a condominium in Metro Vancouver at the end of October was $727,100, a decrease of 0.2% the from the preceding month. The extremities of this average were West Vancouver at $1,193,200 and Sunshine Coast at $506,100. The three municipalities on the higher side of the average were: Tsawwassen at $751,500, a decrease of 0.2% from the preceding month; Burnaby South at $751,600, a decrease of 0.2% from the preceding month;  and Burnaby East at $721,200, an increase of 0.6% from the preceding month. The three municipalities closest to the benchmark on the lower side of the average were: Ladner at $717,100, an increase of 1.2% from the preceding month; Burnaby North at $711,900, an increase of 0.6% from the preceding month; and Richmond at $699,600, a decrease of 0.6% from the preceding month.

 

I can help

 

These are challenging times for home buyers and homeowners. With Bank of Canada interest rates still rising, 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.