Metro Vancouver’s existing home sales soared past historical levels in October, but activity still varies based on property type.
A total of 3,022 homes changed hands in the region last month, up 35 per cent from the 2,233 sales recorded a year ago, according to the Real Estate Board of Greater Vancouver’s (REBGV) latest data, published today.
“For condos and townhomes, the demand is still very high. We still are seeing a shortage in supply certainly for both of those categories,” Jill Oudil, REBGV president tells BuzzBuzzNews.
Last month, sales were 15 per cent above the 10-year October sales average.
A total of 1,532 condos and 550 attached homes sold in October, representing 30 per cent and 36.5 per cent year-over-year increases, respectively. Meantime, 940 detached properties sold, up 44 per cent from the 652 sales a year ago.
According to Oudil, demand is being driven by the growth of BC’s provincial economy, along with a steady job market. But a booming economy might not be the only reason for a surge in sales last month.
In October, the Office of the Superintendent for Financial Institutions’ (OSFI) announced that as of January 1, a new stress test will require all uninsured mortgage borrowers to qualify against the Bank of Canada’s five-year benchmark rate, or at their contract mortgage rate plus an additional two per cent.
Oudil says the impending changes in the mortgage qualification process could have played a role in the region’s strong sales performance in October.
The announcement has helped spur activity in the region recently, as people are entering the market ahead of the new rule changes, says Oudil.
Although sales exceeded historical levels last month, activity varied among the region’s different housing segments.
Strong demand for more affordable condos and townhomes continued, while sales moderated for single-family homes.
With more supply available in the detached segment, prices are easing, says Oudil. Conversely, limited supply in the condo and townhouse segments is causing prices to climb.
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“Detached [prices] actually have not changed a lot. Attached, condos and townhomes are almost the same as last month but they certainly have been going up over the last year,” says Oudil.
Last month, condo prices rose roughly 23 per cent year-over-year to $642,000. Meantime, attached prices was $802,400, up 18 per cent from a year ago.
In the detached segment, the benchmark price of a home was $1,609,600 — a four per cent uptick from a year ago.
Overall, the benchmark price for all residential properties in Metro Vancouver was $1,042,300 last month, a 12.4 per cent increase compared to October 2016 and up 0.5 per cent from September 2017.
Oudil notes the sales-to-active listing ratio for a condo was still extremely high last month at 66 per cent. Whereas, the detached market was relatively balanced with a sales-to-active listing ratio of 17 per cent, says Oudil.
For the remainder of 2017, Oudil anticipates more attached homes will enter the market, increasing supply and relieving pressure on the more affordable housing segments.