After a dismal spring so far, Metro Vancouver residential real estate activity leaped by 44.2% month over month to 2,638 homes sold in May, according to figures released June 4 by the Real Estate Board of Greater Vancouver (REBGV).
However, May is historically the busiest month of the year for home sales, and last month’s jump was from very low April figures. May’s transaction total is still 6.9% lower than in May 2018, 22.9% below the 10-year average for the month and the lowest May total since 2000.
Still, the new figures do mark a notable improvement over the 29.1% annual sales drop seen in April 2019, which was 43.1% below April’s 10-year average.
The board maintained its stance of attributing low demand to the mortgage stress test. “High home prices and mortgage qualification issues caused by the federal government’s B20 stress test remain significant factors behind the reduced demand that the market is experiencing today,” said Ashley Smith, REBGV president.
Despite the increased sales activity in May, it was not enough to offset all the new listings coming on to the market, and inventory continues to pile up. There were 5,861 homes newly listed last month, which is 8.1% less than May 2018 but a 2.1% increase compared with April. It’s also more than double the number of homes sold last month.
The total number of homes listed for sale on Metro Vancouver’s MLS is 14,685, a 30% increase compared with May 2018 and up 2.3% since April 2019. This is the highest number of homes listed for sale since September 2014, said the board.
However, the improved absorption rate meant that Metro Vancouver stayed firmly in a balanced market in May. For all property types, the sales-to-active listings ratio for May 2019 is 18%. When broken down by property type, the ratio is 14.2% for detached homes (returning to a balanced market, if maintained for several months), 20% for townhomes and 21.2% for apartments (both edging back toward seller’s markets, but again, only if this ratio is sustained).
Despite this, the generous supply of homes for buyers to choose from is pulling prices down, with the composite benchmark price of a home (all property types combined) across Metro Vancouver now at $1,006,400. This is an 8.9% drop since May 2018, and a slim 0.4% decline compared with April 2019.
Smith added, “Whether you’re a buyer looking to make an offer or a seller looking to list your home, getting your pricing right is the key in today’s market.”
Jason Turcotte, vice-president of development at Cressey Development Group, said, “The current market is reflective of a change in buyer sentiment. Prospective homebuyers are taking their time in purchasing; this doesn’t mean the activity is not there, it just means they feel they have time on their side in this market.”
Sales and prices by property type and area
Having taken the toughest beating so far, the single-family market saw the biggest improvement last month. Detached home sales across Metro Vancouver totalled 913 transactions, which is nearly 56% higher than in April and only 1.4% lower than in May 2018.
The benchmark price for a typical detached home in the region is $1,421,900, which is an 11.5% decrease from May 2018 and a 0.5% slip from April 2019.
As ever, West Vancouver and Vancouver West saw the sharpest annual drop in detached benchmark prices, down 16.6% and 14.5% respectively. Single-family prices fell on an annual basis in all markets, but saw the least-steep declines in Whistler (-2.3%) and Ladner (-2.9%). Six of the board’s 20 areas saw detached prices rise since April : Whistler, Ladner, Burnaby North, and the three Tri-Cities areas of Port Moody, Coquitlam and Port Coquitlam.
The story is quite different in the attached home market. Attached homes such as townhouses and duplexes were the only property type to see a year-over-year sales increase – up 0.6% to 479 total unit transactions across the region. That’s a 33.8% increase compared with the previous month.
This home type was also the only one to see prices rise compared with the previous month. A typical attached unit in the region now goes for $779,400, which is a 7.6% decrease from May 2018 but a 0.6% increase compared with April 2019.
Ladner may be seeing better detached sales, but its townhomes slipped the most in benchmark price last month, down 15.8%, followed by Tsawwassen (-13.8%). Those two areas were also among just six local markets to see a month-over-month townhome price drop, along with New Westminster, Richmond, Whistler and Port Moody. All the other areas saw a slight uptick in benchmark townhome price over April.
Some 1,246 Metro Vancouver condos changed hands in May 2019, which is the steepest annual decline at a 12.9% decrease compared with May 2018. However, it’s an impressive 40.8% more condo sales than in April this year.
The benchmark price of a typical apartment property is now pegged at $664,200. This represents a 7.3% decrease from May 2018, and a 0.5% slide compared with April 2019.
Whistler and Squamish were the only MLS areas in the board’s jurisdiction to post a year-over-year condo benchmark price increase, up 4.3% and 1.3% respectively. The steepest annual price drops for this property type were seen in West Vancouver – down a whopping 18.6% – and Vancouver West, down 10.3%.
Home prices vary widely in different areas throughout the region.
Metro Vancouver Home Sales Jump 44.2% in A Month, but Prices Slip Further by Joannah Connolly | Glacier Media Real Estate | Business in Vancouver
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