Following a record-setting year, the Metro Vancouver housing market should continue to see buyers compete for fewer listings at higher prices in 2022.
The Real Estate Board of Greater Vancouver (REBGV) reports the region saw a total of 43,999 home sales during 2021, a 42.2 per cent increase from the previous year and four per cent higher than the all-time sales record set in 2015. Last year’s sales total was 33.4 per cent above the 10-year average.
“With low interest rates, increased household savings, more flexible work arrangements, and higher home prices than ever before, Metro Vancouverites, in record numbers, are assessing their housing needs and options,” said REBGV economist Keith Stewart.
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Reduced supply has created competitive conditions across Metro Vancouver, with the housing shortage pushing prices to all-time highs.
The composite benchmark price for all residential properties in Metro Vancouver ended the year at $1,230,200, representing a year-over-year increase of 17.3 per cent. The benchmark price of a detached home crept over $1.9 million, while the condo benchmark sits at $761,800.
“Detached house prices are now up 22 per cent year-over-year, and condo prices are starting to catch up, rising 13 per cent,” said Vancouver realtor Steve Saretsky in a recent report. “It would not surprise me to see condos outperform detached houses in the year ahead.”
Metro Vancouver recorded 2,737 total housing sales in December, down 22 per cent from the previous month due to reduced supply, with new home listings failing to keep up with surging demand.
There were 1,945 properties listed for sale during December, a 50.9 per cent decrease from the previous month and 19.3 per cent drop year-over-year.
“In Greater Vancouver we are currently sitting at 4,900 active listings for sale as of the end of December. This is the lowest count on record, ever,” Saretsky said. “In other words, we are starting the new year from a record low inventory base. It will take many months, likely longer, to get inventory to healthy levels, let alone oversupplied.”
Detached homes are in short supply across Metro Vancouver, with months of inventory currently sitting at 2.5, although the inventory gap widens significantly as prices increase.
Single-family houses priced under $2 million are currently seeing only 0.9 months of inventory for sale, compared to 8.2 months of inventory for houses listed over $3 million.
“The number of qualified buyers begins to shrink when prices move north of $2 million so this could be a problem for the market moving forward, which is why I think price growth could be constrained this year,” said Saretsky.
Condo listings fell 14 per cent month-over-month in December, while the months of inventory for sale has plunged to 1.5, dipping to its lowest point since August 2017.
“If you’re looking for a condo under $1 million then months of inventory falls even further, down to 1.1,” Saretsky said. “The name of the game is affordability. Everyone is struggling with housing affordability and so most of the demand is concentrated at the entry levels.”