A tale of two markets in Metro region, as condos soar and houses normalize
An overall drop in Greater Vancouver home sales in June – both year over year and month over month – masks the huge differences between the region’s condo market and its detached home market, according to Real Estate Board of Greater Vancouver figures released July 5.
There were a total of 3,893 home sales in the region in June 2017 – a drop of 11.5% since June 2016, which posted an all-time record for that month. It is also a fall of 10.8% compared with May this year.
However, June’s activity was still 14.5% above the 10-year average for the month, noted the board.
The slowing sales activity did nothing to prevent the overall benchmark price (composite of all home types) from rising to new heights, now just shy of the million-dollar mark at $998,700. Again, this overall figure hides significant variations between price movements of the three home types.
New listings in June fell 2.6% year over year to 5,721 homes, which is also a 5.3% decrease compared with May 2017.
However, the total number of Metro Vancouver properties listed for sale on the MLS® system as of June 30 is 8,515, a 9% rise compared with one year previously and a 4.2% increase over May 2017. The slowing sales in June resulted in this inventory increase, despite the drop in new listings.
For all home types, the sales-to-active listings ratio for June 2017 is 45.7%, which indicates that Greater Vancouver remains firmly in a seller’s market.
Home Type Breakdown
Single-family home sales in Greater Vancouver last month fell 15% year over year to 1,320, which is also 14.7% less than May this year.
Sales of townhomes, row homes and other attached properties such as duplexes totalled 668 units, which is a fall of 8.5% over last year and down 15.4% compared with the transaction surge seen the previous month.
Condo sales in June fell 9.6% over last June to 1,905, which is 11.4% lower than May this year. However, this is largely due to a desperate shortage of available condo units on the market, creating massive competition for very few units.
“Two distinct markets have emerged this summer. The detached home market has seen demand ease back to more typical levels while competition for condominiums is creating multiple-offer scenarios and putting upward pressure on prices for that property type,” said Jill Oudil, REBGV president.
By property type, the sales-to-active-listings ratio is 24.5% for detached homes, which is creeping towards a balanced market, whereas it is 62% for townhomes, and a staggering 93.2% for condos.
“Home buyers have more selection to choose from in the detached market today while condominium listings are near an all-time low on the MLS®,” added Oudil. “Detached home listings have increased every month this year, while the number of condominiums for sale has decreased each month since February.”
Prices by Property Type
The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $998,700. This is a 7.9% increase over June 2016 and a 1.8% increase over May 2017, making it the highest composite benchmark home price on record.
However, the benchmark price for detached properties did not rise by a similar amount. Currently at $1,587,900, this is just 1.4% higher than a year ago (versus the annual increases seen a year ago of 30% or more), and up 1.1% over May this year.
Townhomes and other attached units’ benchmark price now stands at $745,700, a 10.7% increase from June 2016 and a 0.6% increase compared with May 2017.
The benchmark price of condos increased by far the most, up 17.6% year over year to $600,700, which is also a 2.9% increase over May 2017, reflecting the huge demand for this property type.
Home prices vary widely throughout the REBGV region. To get a good idea of home prices in a specific location, check the detailed MLS® Home Price Index in the REBGV full statistics package. See a detailed infographic on June's REBGV statistics.