Vancouver Detached Homes See Higher Prices For A Third Month In A Row

 

 

Vancouver real estate is seeing higher prices, especially detached homes where they’re now trading at June 2016’s scorching levels.

 

After taking a small dip last year, Vancouver real estate is back with a vengeance. The Real Estate Board of Greater Vancouver’s (REBGV) latest numbers showed detached home sales, the most expensive type of homes, saw prices increase for a third month in a row. The increase comes with higher inventory, and less sales.

Detached Prices Are Up

The price of a detached home is increasing across the REBGV. The benchmark price, that is the price of a typical detached unit, is now $1,561,000. This is a 3.1% increase from the same time last year, and a 2.1% increase from the month before. The benchmark is showing solid improvement, but it might not look like much when compared to last year’s massive 36.9% increase. This puts the benchmark price on par with June 2016.

Vancouver Detached Prices (Benchmark)DetachedPricesDecember 2015February 2016April 2016June 2016August 2016October 2016December 2016February 2017April 2017$1,200,000$1,300,000$1,400,000$1,500,000$1,600,000Canadian Dollars
MonthDetached Prices
December 2015 1,248,600
January 2016 1,273,100
February 2016 1,305,600
March 2016 1,342,500
April 2016 1,403,200
May 2016 1,513,800
June 2016 1,561,500
July 2016 1,578,300
August 2016 1,577,300
September 2016 1,567,500
October 2016 1,545,800
November 2016 1,511,100
December 2016 1,483,500
January 2017 1,474,800
February 2017 1,474,200
March 2017 1,489,400
April 2017 1,516,500
May 2017 1,561,000
 

Source: REBGV.

There’s been much talk about average prices falling, and that appears to be a reversing trend too. The average price of a detached sale in May 2017 went for $1,830,956, a 4.96% increase from the same time last year. For a little context, May 2016 saw the average detached sale increase in price 23%. Anyway you measure it, Vancouver detached homes are rising in prices. This doesn’t mean some of the nosebleed priced units will move at ask, but it means there will definitely be less deals to be found.

Listings Are Higher

Detached inventory across the Greater Vancouver Region (GVR) is building. REBGV logged 8,168 listings, a 5.7% increase from the same time last year. REBGV has attributed many of the listings to downsizing Boomers, looking to realize some of their profits. There’s also mounting evidence that overseas buyers liquidating assets due to capital constraints might be adding to the inventory.

Vancouver Detached Sales Vs. ListingsSalesListingsDecember 2015February 2016April 2016June 2016August 2016October 2016December 2016February 2017April 201707501,5002,2503,000Detached Homes
MonthSalesListings
December 2015 1,136 830
January 2016 1,047 1,929
February 2016 1,778 2,811
March 2016 2,135 2,931
April 2016 1,979 2,883
May 2016 1,865 2,915
June 2016 1,920 2,618
July 2016 1,077 2,386
August 2016 715 1,814
September 2016 666 2,147
October 2016 652 1,596
November 2016 638 1,205
December 2016 541 513
January 2017 444 1,915
February 2017 741 1,430
March 2017 1,150 1,924
April 2017 1,204 2,091
May 2017 1,548 2,657
 

Source: REBGV.

Sales Are Down

An increase in inventory can be a good thing, or a bad thing – depending on how sales respond to the number. REBGV saw 1,548 sales, a 17% decline from the same time last year. This leads to a much lower absorption of listings when compared to last year, but would be strong when compared to any other city.

An increase in inventory with a decline in sales typically leads to lower prices, but Vancouver residents didn’t get that memo. Despite the greater selection available for buyers, prices are still on the rise. Much of this has to do with multiple segments of buyers turning towards the same type of home. In order for those well funded Boomers to downsize and realize profits, they’re going to be competing with first-time buyers – placing even more pressure on prices.

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