Vancouver housing market turning into tale of two cities
Detached price gains remain mostly flat as condos, townhomes stir strong demand
Almost a year after British Columbia brought in a 15-per-cent tax on foreign buyers in Greater Vancouver, the detached housing market in Canada’s most expensive city for housing continues to show limited price growth.
But while detached price gains continue to be mostly flat, the overall market for housing in Greater Vancouver does show signs of recovering, buoyed by the strength in less expensive segments like condominiums and townhomes, the Real Estate Board of Greater Vancouver said Wednesday.
“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,” Jill Oudil, president of the board, said in a statement.
The Vancouver results are being watched closely in Ontario, where the province introduced a 15-percent non-resident speculation tax in April for homes bought in the Greater Golden Horseshoe, the area that surrounds and includes Toronto. Provincial officials announced this week that in the wake of the tax, about 4.7 per cent of home buyers were from abroad. There were 1,320 Greater Vancouver detached home sales in June, a 15.5-per-cent decrease from a year ago. The benchmark price for detached properties was $1,587,900, a 1.4-per-cent increase from June 2016 and a 1.1-per-cent increase compared to May 2017.
In the apartment sector, there were 1,905 sales in June 2017, a drop of 9.6 per cent from a year ago. The benchmark price of an apartment property was $600,700, a 17.6-per-cent increase from a year ago and a 2.9-per-cent increase from a month earlier.
Attached property sales, which includes townhomes, were off 8.5 per cent in June from a year ago. The benchmark price of an attached unit was $745,700 in June, a 10.7-per-cent increase from a year ago and a 0.6-per-cent increase compared to May 2017.
Overall, REBGV said there 3,893 sales across the region last month, an 11.5-per-cent decrease from June 2016, an all-time record, and a 10.8-per-cent decrease from May. June sales were still 14.5 per cent above the 10-year sales average for the month.
The 5,721 new listings last month represented a 2.6-per-cent decline from a year ago and 5.3-per-cent decrease from May 2017. The total number of properties listed for sale in Greater Vancouver last month was 8,515, a nine-per-cent increase compared to June 2016 and a 4.2-per-cent increase compared to a month earlier.
“Home buyers have more selection to choose from in the detached market today while condominium listings are near an all-time low," Oudil said. “Detached home listings have increased every month this year, while the number of condominiums for sale has decreased each month since February.”
For all property types, the sales-to-active listings ratio for June 2017 was 45.7 per cent. By property type, the ratio was 24.5 per cent for detached homes, 62 per cent for townhomes, and 93.2 per cent for condominiums.
“Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months,” the REBGV said.
The MLS Home Price Index composite benchmark price for all residential properties in the metro Vancouver area was $998,700, up 7.9 per cent from a year earlier and 1.8 per cent from a month earlier.
Detached home listings have increased ... while the number of condominiums for sale has decreased.