The trend for new home sales in Metro Vancouver is looking like it will be a record-breaking year, despite a slower August than last year, according to real estate marketing firm Fifth Avenue.
Speaking to REW.ca editor Joannah Connolly on the Real Estate Therapist show on Roundhouse Radio 98.3FM September 10, Scott Brown, president of Fifth Avenue, said that between 18,000 and 20,000 new homes are expected to be sold across the whole year, outstripping even the 10-year high of 2015’s 17,000-plus sales.
The real estate marketing company’s second-quarter report says that 12,968 new multi-family homes were sold in Metro Vancouver from January 1 to June 30, 2016 – “possibly the greatest half year total ever,” according to the August 31-released analysis.
This first-half total represents more multi-family sales volume than the full-year figures posted from 2010 to 2012, which were in themselves considered “healthy” years, said Brown.
Brown added that early figures suggest that July’s new home sales were “reasonably strong” and then there was a cooler August, which he described as a “hangover” from the introduction of the foreign buyer tax August 2.
“The hangover is now lifting,” he told the Real Estate Therapist show. “We think that this August will be more like August of 2014, rather than last August, which was a really hot August with no seasonality.
“We’re expecting that demand will lift again and absorption will rocket through the fall. We’re already starting to see it at the sites that we monitor. Some sites didn’t even see a quieter August, so it varies neighbourhood by neighbourhood."
He added, “We won’t be talking about the tax through October and November. What we will be talking about is that prices now have stabilized. The price gains we have seen will be sustained but we won’t continue to see those incredible price increases. Buyers will realize that they don’t have to buy immediately, but that they do need to buy, because the supply of new housing is still so constrained and standing inventory of new homes is at all-time lows.”
Brown pointed out that most of the media coverage of real estate is focused on resale figures, and that it lacks the balance of additional statistics on new home sales.
“I’ve been involved in the real estate industry for the best part of three decades, and there’s is no other industry where you would rate the success or health of the industry based on the sales level of a used product," Brown pointed out. "Yes, homes trade, and it’s an important indicator of market growth and conditions. But last year, there were 17,000 new, never-owned homes sold, and the majority of those were never reported about in the media, and the vast majority of them never appear on the MLS… And we need to be looking at that segment of the market and saying the new home market is extremely healthy, and why is nobody looking at that?”
To listen to the full discussion between Scott Brown and the Real Estate Therapist on Roundhouse Radio, click here. The Real Estate Therapist show airs on Roundhouse Radio 98.3FM Saturdays 9am-10am and streams on roundhouseradio.com.
