The downturn in Metro Vancouver housing sales that we have been tracking over the past few months is not surprising and should not be alarming. After many months of record-setting sales increases, it is only natural that a peak would be reached. We have seen similar cycles in the past and will certainly experience them in the future.
In a video address in January of this year, I predicted a very active spring selling season followed by a market slowdown during the summer, which we are now experiencing.
But the right term to use is slowdown and not downturn in Canada’s most dynamic housing market. With the 0.6% increase in total housing sales seen in June, compared with June of 2015, transactions through the Real Estate Board of Greater Vancouver in the first half of this year reached 11,503 homes, well above the 8,663 sales experienced in the first half of last year. June sales, in fact, were 28.1% above the 10-year sales average for June and the highest selling June in history.
Slowing sales are seen primarily in the detached housing market, while sales of townhouses and condominiums in June increased by 7.2% and 18.3%, respectively, from June 2015. Detached housing sales in June were down 18.2% from the same month a year earlier. Home buyers are definitely following affordability.
In South Surrey-White Rock, which had been leading all of the Lower Mainland in sales increases this year, detached housing sales dipped 25.1% in June compared to a year earlier, while sales of townhouses posted a modest year-over-year decline of 1.2%. Much of this could be due to lower inventory: active listings for detached houses are down 9.1% from a year ago and townhouse listings have plunged 68.8%.
Still, with benchmark prices across the Lower Mainland up 32.8% from a year ago and the sales-to-listing ratio above 53%, this remains very much a seller’s market. Also, with 14,840 new homes starts across the Metro region during the first six months of this year – up 62% from a year earlier – the inventory is increasing, particularly for strata properties.
The current conditions, though, send a clear signal to both sellers and buyers. For sellers it means do not take anything for granted. Be certain that your price and your property reflect a potentially more competitive environment. For buyers, it opens greater opportunities to find a home at certain price points.
For real estate professionals, it means going that extra mile to ensure that all of our clients receive accurate information and pertinent advice on home selling or buying strategies.
I know many pundits will be talking about a housing bubble, even forecasting a general slowdown in the Lower Mainland residential market. But keep this in mind: the decisions you make are individual choices based not on statistics or forecasts but on what is right, right now, for your family, your lifestyle and your future.
The best deal in today’s housing market is the one that you are satisfied with. Everything else is just noise.
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