Provincial average home sale price drops 10.5%, but many markets see price increases based on short supply
British Columbia home sales were down 21.8 per cent year over year from the March record set in 2016, according to BC Real Estate Association (BCREA) figures released April 13. There were 9,826 residential MLS® transactions recorded during the month compared to 12,559 the previous March.
The decline was led by drops in the number of sales in three markets: Greater Vancouver, the Fraser Valley and Chilliwack. Smaller reductions in unit sales were seen in the Victoria, Kootenay, Okanagan Mainline, and Vancouver Island regions, with the remaining five of the province’s 12 real estate boards reporting year-over-year increases in unit sales.
The average home sale price in BC also dropped in March, despite price increases in 10 of 12 markets across the province. The overall provincial price drop to $690,597, down 10.5 per cent from March 2016, was driven by a change in the provincial mix of sales, with fewer sales of higher-priced homes in Greater Vancouver area. In other markets, BCREA noted, prices are rising because of “severe supply constraints.”
“Consumer demand continues to normalize following blockbuster home sales in 2016,” said Brendon Ogmundson, BCREA economist. “However, the supply of homes available for sale has not recovered and is still declining in many markets around the province.”
In Victoria, BCREA noted, where just over one month of home inventory is available, the residential average price increased by 11.3 per cent year over year. Victoria saw a sales-to-active-listings ratio of 83.4 per cent in March, the highest in the province.
Greater Vancouver had a 44.2 per cent sales-to-active-listings ratio in March, the second-highest in BC. BCREA highlighted the condo and townhouse market in the Lower Mainland as an area of tight supply.
The decreases in number of home sales and average home sale price led to a corresponding decrease in total sales dollar volume. At $6.79 billion, the total provincial figure was 30 per cent lower than in March 2016.
While BC’s home sales dropped year over year in March, national home sales increased to top the previous monthly record set in April 2016 according to Canadian Real Estate Association (CREA) figures released April 18.
The decline in BC sales was offset by gains in 75 per cent of local markets across the country, particularly in the Greater Toronto Area (GTA). Overall national sales activity increased 6.6 per cent from a year ago.
“The current strength in national home sales mainly speaks to what’s going on in and around Toronto,” said Andrew Peck, CREA president. “Elsewhere, sales either remain slow or well below previous heights.”
Across Canada, the sales-to-new-listings ratio dipped slightly to 67.4 per cent in March, still well above the sellers’ market threshold. The ratio was in sellers’ market territory in about 60 per cent of housing markets across Canada, mostly in BC, in and around the GTA, and in southwestern Ontario, CREA notes.
Just as the BCREA highlighted tight supply in this province, the CREA noted there were 4.1 months of national real estate inventory at the end of March, the lowest level in nearly 10 years.
The aggregate composite benchmark price across Canada rose 18.6 year over year to $587,200, while the average national price rose 8.2 per cent to $548,517. CREA notes that the benchmark price provides the more accurate picture because average prices are affected by changes in the mix of housing types sold.
Greater Vancouver and the GTA were the main drivers of increases in the national average price, according to the report. “The average price is reduced by more than $150,000 to $389,726 if Greater Vancouver and Greater Toronto sales are excluded from calculations,” CREA notes.