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Vancouver Housing Market Report
Yes, the housing market in the greater Vancouver region saw huge growth in sales in the final months of 2019. Sales grew to 2858 units which is up 45% since last October’s total of 1966 units. And that was 9.8% above the October historic average.
The number of total property transactions grew 22% over last month. The Vancouver condo market forecast is highlighted with new demand and big price increases too. See the report and videos.
The price of an average house is $1,410,500 which is actually still a decline of 7.5% from 12 months ago. The single home prices has decreased 1.4% over the last 6 months, although rose .3% since over September’s.
Apartment sales hit 1,384 units in October, which is up 40.5% over the 985 apartments sold in October 2018. The average price of an apartments is $652,500. The price is 5.9% lower than October 2018. See more of the condo/apartment stats below.
536 townhouses and attached homes were bought and sold in October 2019. That is a whopping 56% rise compared to 12 months ago. The current average prices for townhouses/attached is $771,600, which is down 5.8% from October 2018, but a .5% increase from last month.
There were 4,074 detached homes, attached, townhouses and apartments newly listed for sale on the MLS® in Metro Vancouver in October 2019. That is a big 16.3% decrease compared to the 4,873 homes listed 12 months ago, and big drop of 9% just since last month. The HPI average price for all residential properties in Metro Vancouver is upt to $992,900.
Composite Home Price Index for Vancouver
GVREB doesn’t comment too much on this rapid decrease in listed properties. Mathematically, it means a big rise in prices coming. December and January might be hot months in Vancouver until a cold front moves in.
More on the Canadian Housing Market
Compared to the flat price markets of Toronto, Montreal, Mississauga, Ottawa, and Calgary, the Vancouver real estate scene is oddly out of whack. Is the Vancouver economy that hot to justify a ballooning of demand? Is this really a bubble?
Politically, Vancouver is way out on a limb after being alienated from Alberta and the Federal Liberal government.
In a recent announcement, the CMHC predicts Vancouver will have a balanced market for the next 2 years. We could interpret that many different ways. Is it a short burst of speculation and incoming new money? CMHC is predicting a housing recovery in 2020 and to accelerate in 2021. This might help fuel sales and new mortgages.
Business Council of BC Economic Outlook
The Business Council of BC released its forecast saying the BC economy will slow.
“Economic growth is expected to remain sluggish over the remainder of the year, leading to a poor hand-off into 2020,” from BIV.
They have downgraded their economic projection for 2019 3 times, to its 1.8% prediction. They downgraded the outlook for 2020 too, from 2.5% to 2.2%.
They cite slowdowns in natural resources, the China trade war, slowed US trade, and general uncertainty. Rising taxes, government cuts, and decreased competitiveness are weighing on the 2020 outlook. The case for big demand and price growth doesn’t make a lot of sense.
Is the Lack of Homes for Sale Driving this Surge?
If the outlook is dropping so fast, why are people bidding up on homes and condos in Vancouver? Are getting what’s available before the next surge in home prices in the years ahead? We’d have to speculate that it’s simply a lack of homes listed.
This chart courtesy of GVREB shows their optimistic long term outlook, and that by 2023, it’s a bullish market.
Premier Locked into Losing Policy
What’s happened to Vancouver’s housing market is political folly and it’s just now at end game that everyone can see it. With the current Premier in office until 2021, the outlook is grave. BC’s policies on housing will cost it $400 million in tax revenue and damage the BC economy for years to come.
The Conference Board of Canada estimates real GDP growth in B.C. will fall slightly to 2.5% and the downward trend will continue into 2020 with real GDP growth projected to fall to 2.4%. Growth in previous years was supported by revenue from the housing market.
It’s disgraceful what’s happening in BC, that new housing isn’t being built. Bad people need to be removed and pro-business people brought in. If demand hits as the experts say it will, Vancouver could be in for another period of deep suffering in high rent to income, and homelessness issues.
The biggest increase in home listings were in North Vancouver, West Vancouver, and Richmond.
BC Housing Sales October
BCREA’s latest sales report reveals there were 7,666 residential sales in the MLS® in October. That’s an increase of 19.3% YoY. The average MLS® residential sales price in BC reached $724,045, which is 5.1% from one year ago. Total sales dollar volume was $5.55 billion, big increase of 25.4% YoY.
BC Average Home Prices
This chart from BCREA shows how severe the situation has been. Provincewide, houses for sale rose by 1% in October and with a sales-to-active listings ratio of 21% (10% is healthy). The recent lull in the market has discouraged and disengaged builders now must be recalled to begin building again. It’s not the price that stops them from building, it’s regulations in finance and zoning that halts new construction in Vancouver. There is no reason to believe this will change for the foreseeable future. That makes fast rising home and condo prices a reasonable forecast.
BCREA Chief Economist Brendon Ogmundson says the market is returning to normal and that a lack of stock will likely bring price rises.
Richard Robbins adds his insight into the Vancouver housing market in this video:
Where is the Vancouver Housing Market Headed in 2020?
The loss of the China to US free trade business is more worrying than many anticipate. Less container traffic, less related import business, along with BC’s isolation in relation to the US markets will impact BC’s economy.
The lull in the US economy is one reason price pressure has eased in Vancouver’s housing sector. Vancouver’s surprisingly low unemployment rate continues at 4.4%. Investment in housing however is dropping as builders grow pessimistic about BC’s future.
Of course, if the US can keep its ship on course, the economy will stay strong and Vancouver home prices will rise once again. If the US/China trade war ceases, it will be very good for BC’s economy. The question then is what will the Provincial government do with the housing situation then.
Buying in Vancouver? Keep your eye on the big picture and key economic events and see which neighborhoods are going to drop in price the most. West Vancouver, North Vancouver, Burnaby, Port Moody, North and Port Coquitlam, appear to be the most vulnerable.
A Look Back at Last Year
Monthly Vancouver Housing Stats report for October 2018:
- detached home sales fell 32%
- 13,000 homes for sale (42% more than last fall)
- 4900 new listings happened in October (+7%)
- total MLS listed resale homes currently listed for sale in Metro Vancouver is
12,984, a 42% increase
- sales of townhomes fell 37%
- attached homes sales fell 37%
- average price of a detached house reached $1,528,000 (down 5% from last October)
- sales of detached houses dropped 32%
- sales of apartments dropped 36%
- 23% increase in home sales compared to September 2018 when 1,595 homes were sold
- Vancouver resale market sales were 26.8% below the 10-year October average
- apartment price fell to $683,500, down 6% from October 2017
- MLS® Home Price Index composite benchmark price is up 1% from last October
Does this make Vancouver a good place to buy a home? The answer has to be yes. Whether it’s free trade or Trump protectionism, Vancouver comes out okay. The question of housing affordability is similar. Suppy never increases.
Sales to active listings ratio for single detached homes reached a depression level of 6.8% in Vancouver.
What happened in July of 2016? The Foreign Buyers Tax. Home prices dropped $200,000.
Yet BC still has the lowest unemployment rate in Canada, (4.2 % in October after 2% growth in September, +33,000 jobs) well ahead of Toronto. Wages could rise giving more impetus to the housing market. However, is this a last (get stuff into the US quick) uptick before the US China tariffs take effect on January 1st?
After reaching 3.9% in 2017, growth is forecast to ease to 2.9% this year and average 2.7% in 2019 to 2020, before slipping to 2.3% in 2021 — BC Economic Forecast Report
The announcement of the $40 billion LNG project is a big booster shot for BC with thousands of jobs to be created. The added investment will give the housing market in Vancouver a little boost and perhaps encourage more new construction. See the full running Vancouver housing market report below.
Uncertain Market Access, Uncertain Jobs
Overall, the Canadian job outlook is not strong, despite the deal, and Trump is being tough on Chinese products entering through Canada. China is in trouble, and Chinese investors are buying in the US instead of Canada. That will affect Vancouver and BC. Read more on the Vancouver economy. The only bright spot is the election of Ed Scheer and PCs and this is why:
US President Trump doesn’t like Trudeau and is likely upset with how he regained the prime minister’s office. With Trudeau, Canada and Vancouver can never be at ease about economic health and market flows and investment.
Just as in the Toronto real estate market, the condo market is where the focus is. That’s due to high home prices and the fed’s new stress test mortgage rules.
Areas covered by the Real Estate Board of Greater Vancouver include: Whistler, Sunshine Coast,
Squamish, West Vancouver, North Vancouver, Vancouver, Burnaby, New Westminster, Richmond, Port
Moody, Port Coquitlam, Coquitlam, Pitt Meadows, Maple Ridge, and South Delta. Burnaby, Squamish, and West Vancouver suffered the largest monthly drops in house prices.
Vancouver remains perhaps the most unaffordable city in North America based on home price vs income. And with new mortgage rules Vancouverites have found themselves not much better off. Ask any post secondary student about housing. However, it’s expected that new investment will pour into student hotel housing projects.
Please do use this report on Facebook or your Newsletter. Why do all the work yourself?
Condo Sales Driving Vancouver’s Market
While sales of detached homes dropped in August 2017 compared to July sales, and compared to August 2016 sales,
Sales History for Vancouver Housing Market
The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in Metro Vancouver totalled 2,489 in August 2016, a decline of 26 per cent compared to the 3,362 sales in August 2015; 10.2% fewer than the 2,771 sales in August 2014; and 1% less than the 2,514 sales in August 2013. August 2016 sales also represent a 22.8% decline compared to last month’s sales. – From the latest market report from REBGV on Sept 2, 2016.
The forecast is for fewer sales and perhaps lower prices, yet because of the foreign buyers tax, it might look more precipitous right now than it actually will be.
BC Economic Outlook
BCREA has offered a renewed look at the BC economic outlook as does BC Business. Take a look.
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REBGV is The Real Estate Board of Greater Vancouver, a member-based association of more than 14,000 REALTORS® who live and work in the Vancouver region.
The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade Associations. It’s membership includes more than 125,000 real estate brokers, agents and salespeople, working through 90 real estate Boards and Associations across Canada.