Photo: Dondy Razon/Flickr
Vancouver condo inventory is nowhere near historical highs despite a recent rush of listings hitting the market — but a local realtor warns that supply levels mirroring the Great Recession aren’t out of the question.
“I think it’s definitely possible. I wouldn’t rule it out,” Steve Saretsky, a Vancouver realtor and founder of Vancity Condo Guide, tells Livabl.
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In 2008, total unsold condo inventory on the resale market exceeded 3,500 units. As of November, supply remained below the 2,000-unit mark.
“It’s important to point out that condo inventory remains low on a historical basis,” writes Saretsky in a related blog post.
He also adds in a followup interview that the runup in resale listings is the result of slackening sales. “It’s not from a flood of people panicking trying to sell,” Saretsky says.
“Most people, including developers, I think, are underestimating how much supply is in the pipeline, so I expect that’s going to add to it considerably,” he continues.
So far this year, developers have released about 16,000 pre-construction units for sale in the Lower Mainland, according to MLA Canada, a marketing and research firm. Of those units, 65 percent have sold. In October alone, developers brought 2,300 new condos to market, an increase of 40 percent from the previous year.
Already, the higher number of condos available for purchase has chipped away at resale pricing in the segment, according to a separate report by credit union Central 1.
“Detached home prices have stabilized following a year of declines, but apartments are shedding value,” writes Bryan Yu, Central 1’s deputy chief economist, in a weekly update.
“An increase in newly completed stock and supply, and concentrated impacts of landing restrictions on entry level buyers is pressuring the market,” Yu notes.
Resale condo prices are now down 4 percent from their last peak, and Central 1 anticipates more declines.