What a difference a year makes.
Last October, it was buyers who were calling the shots in the Vancouver region’s housing market as higher detached home inventory tipped the balance away from sellers.
Now, after an anxiety-ridden spring and a remarkable summer bounce back, home sales have continued their high-flying performance in September while new home listings struggled to keep up.
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“Market conditions [in the Vancouver region] are firmly entrenched in a sellers’ market,” wrote Central 1 Credit Union Deputy Chief Economist Bryan Yu in an economic update published late last week.
“While new listings remained elevated, strong sales have largely absorbed these units. The sales to-inventory (active listings) ratio is trending near 30 percent, whereas a balanced market is typically in the 15 to 20 percent range,” he continued.
Yu wrote that the townhome and detached home segments were “particularly tight” but even the market for condo apartments favoured sellers.
With sellers holding the bargaining power once again, home price growth has accelerated and Yu projects that appreciation will pick up further in the coming months even if the economic recovery moderates.
All this, of course, begs the question: After ending 2019 in buyers market territory, how can sellers be back in control during a year that’s seen an unprecedented freeze in sales activity during the spring and a wave of fear and economic uncertainty brought on by a pandemic?
While unemployment remains high in the Vancouver region, Yu said that rock bottom mortgage rates, stronger employment figures for higher income earners, and buyer preferences shifting to ground-oriented homes have all worked in tandem to buoy demand.
This is how the Vancouver market has shifted back into seller’s territory, even with new listings remaining elevated in September relative to year-ago levels.
Yu went on to note that home sales in the region are currently on pace to rise 20 percent over 2019’s total.