Photo: Kenny Louie/Flickr
As Metro Vancouver continues to face a housing affordability crisis, demand for condos surged in June, outweighing supply.
Last month, the benchmark price of a condo was $600,700, soaring 18 per cent from June 2016 and 3 per cent from May 2017, according to the latest data from the Real Estate Board of Greater Vancouver (REBGV).
Even though condo sales dropped 9.6 per cent year-over-year to 1,905 sales in June, fierce demand for the more affordable property type in the market spurred increased competition among homebuyers.
“Two distinct markets have emerged this summer,” says Jill Oudil, REBGV president, in a press release.
“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,” she adds.
A total of 1,320 detached homes changed hands in Metro Vancouver last month, a 15.5 per cent drop from the 1,562 sales in June 2016.
The benchmark price of a detached home in June was $1,587,900, which represents a 1.4 and 1.1 per cent increase from June 2016 and May 2017, respectively.
In Metro Vancouver, there were 3,893 residential transactions in June, down 11.5 per cent from the all time-record of 4,400 homes sold in June 2016 and a drop of 11 per cent compared to the previous month when 4,364 homes sold.
Even though transactions declined year-over-year, the region’s sales in June were 14.5 per cent above the 10-year sales average for the month.
With increased demand for condos, fewer homes were newly listed in the region last month compared to a year ago.
In June, a total of 5,721 properties in Metro Vancouver, including detached, attached and apartment, were newly listed for sale on the Multiple Listing Service (MLS).
This is a 2.6 per cent drop from the 5,875 homes listed in June last year and a 5.3 per cent decrease from May 2017.
“Home buyers have more selection to choose from in the detached market today while condominium listings are near an all-time low on the MLS,” says Oudil.
“Detached home listings have increased every month this year, while the number of condominiums for sale has decreased each month since February,” she adds.
Last month, the sales-to-active listings ratio for all property types in the region was 45.7 per cent, putting upward pressure on home prices.
Typically, when the ratio falls below 12 per cent for a prolonged period of time home prices experience downward pressure, says REBGV. Conversely, when the ratio surpasses 20 per cent over several months it puts upward pressure on home prices.
In the attached sector, sales activity eased last month from increased momentum seen in May.
A total of 668 attached properties sold in June, down 8.5 per cent from last year. Meanwhile, the benchmark price was $745,700, a 10.7 per cent increase from June last year and a one per cent increase from May 2017.