After bursting out of the gate in 2021, the Lower Mainland’s housing market continued to put on a show in February.
Home sales across the region, which encompasses Metro Vancouver and Abbotsford-Mission, were up 90 percent annually in February. The 6,544 transactions recorded last month represented the second highest sales total ever achieved in the Lower Mainland.
According to Central 1 Credit Union Deputy Chief Economist Bryan Yu, February 2021 only narrowly missed displacing February 2016 from the top spot in sales performance.
In a recently published research note, Yu writes that buyers are “seemingly undeterred” by soaring home prices. While it may still seem surprising that near-record home sales totals are being achieved during a pandemic, Yu believes that key market drivers remain in place.
“Buyers remain incentivized by the low mortgage rate environment, while the pandemic has contributed to higher savings and a desire for more space as many individuals work remotely,” he wrote.
The economist noted that the sales-to-active listing ratio — a measure of whether the market is in buyers’ or sellers’ territory — rose above 50 percent in February and hit its highest mark since 2016. A ratio this high represents a “strong sellers’ market,” wrote Yu.
Looking ahead, Yu is forecasting a rise in condo prices after a sluggish performance in 2020. Homebuyers priced out of the single-family market segment could increase demand in the less expensive condo segment. Investors, buoyed by the increasing pace of the vaccine rollout, could begin jumping back into the market too, he wrote.
In separate commentary published earlier this month, RBC Senior Economist Robert Hogue wrote that both the Vancouver region single-family home and condo market segments have been showing off their strength recently. The former, however, still have considerably more wind in their sails than the latter when it comes to the pace of price increases expected in the near-term.
