As summer comes to a close, higher borrowing costs have begun to permeate the Metro Vancouver housing market in predictable ways, with price gains cooling and sales slowing along the typical seasonal pattern. Additionally, the Bank of Canada announced that it will be holding its current policy rate. With the fall market upon us, we are anticipating a steady and stable course in the months ahead.
The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,296 in August 2023, a 21.4 per cent increase from the 1,892 sales recorded in August 2022. This was 13.8 per cent below the 10-year seasonal average (2,663).
“It’s been an interesting spring and summer market, to say the least” Andrew Lis, REBGV’s director of economics and data analytics said. “Borrowing costs are fluctuating around the highest levels we’ve seen in over ten years, yet Metro Vancouver’s housing market bucked many pundits’ predictions of a major slowdown, instead posting relatively strong sales numbers and year-to-date price gains north of eight per cent, regardless of home type.”
The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 10,082, a 0.2 per cent decrease compared to August 2022 (10,099). This was 13.4 per cent below the 10-year seasonal average (11,647).
Across all detached, attached and apartment property types, the sales-to-active listings ratio for August 2023 is 23.9 per cent. By property type, the ratio is 14.2 per cent for detached homes, 30.3 per cent for townhomes, and 31.9 per cent for apartments.
Analysis of the historical data suggests downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.
“It’s a bit of a tortoise and hare story this year, with sales starting the year slowly while prices increased due to low inventory levels,” Lis said. “As fall approaches, sales have caught up with the price gains, but both metrics are now slowing to a pace that is more in-line with historical seasonal patterns, and with what one might expect given that borrowing costs are where they are.”
In South Surrey/White Rock, we are seeing a balanced market for detached homes, with a 15% Sales Ratio, meaning that 1.5 in every 10 homes sold in the month. Average sale price rose 5% to $1,940,000 and sales volume rose 37%. Condos and Townhomes are currently seeing Seller’s Market conditions, with 3.4 in every 10 homes selling in the month.
Alex K. Liang: 604-817-5179 | Parm Pooni: 604-657-1742