The Greater Vancouver condo rush might have just turned. Real Estate Board of Greater Vancouver (REBGV) numbers show condo apartment prices declined for the first time in years this January. The decline came as sales for the month fell to a 9 year low, and inventory climbed to a multi-year high.
Greater Vancouver Condo Prices Are Down Over 6% From Peak
The price of a condo in Greater Vancouver is coming down. REBGV reported a benchmark price of $658,600 in January, down 0.8% from the month before. This represents a 1.7% decline compared to the same month last year. In the City proper, condo apartments in Vancouver East fell to $530,500, down 3.9% from last year. In Vancouver West prices fell to $783,400, down 3.6% from last year. Prices are falling, but they still have a long way to go for typical incomes.
Greater Vancouver Condo Apartment Benchmark Price
The price of a typical condo apartment across Greater Vancouver, in Canadian dollars.
Source: REBGV, Better Dwelling.
The annual price change is showing a continued trend of deceleration. This is the twelfth consecutive month the annual pace of growth has declined. The annual pace of growth is also showing the largest decline since May 2013. Prices have fallen 6.47% from peak, or $45,600 across Greater Vancouver.
Greater Vancouver Condo Benchmark Price Change
The annual percent change of a typical condo across Greater Vancouver.
Source: REBGV, Better Dwelling.
Greater Vancouver Condo Sales Fall Over 44%
Condo apartment sales are falling across Greater Vancouver. REBGV reported 559 sales in January, up 4.48% from the month before. This represents a 44.8% decline compared to the same month last year. The monthly rise is seasonally expected, but the annual decline is obviously not. This is the fewest condo sales for a January since 2010.
Greater Vancouver Condo Sales Vs. New Listings
The number of condo apartments sold vs new inventory in Greater Vancouver.
Source: REBGV, Better Dwelling.
Greater Vancouver Condo Inventory Rises Over 105%
The number of condos listed for sale experienced a sudden spike. REBGV reported 2,159 new condo listings in January, up 235% from the month before. This represents a 43.64% increase compared to the same month last year. New listings and falling sales helped to push the total level of inventory to a multi-year high.
The number of active condo listings for sales on the MLS continued to build. There were 4,115 active listings in January, up 9.12% from last year. This represents a 105.23% increase compared to the same month last year. That’s the most inventory for the month since 2015, before the last rate cut.
Greater Vancouver Condo Prices Are Trending Lower
Falling sales and rising inventory has left the condo sales to active listings ratio (SALR) to the lowest levels in over 4 years. The ratio fell to 13.6% in January, ad 76% decline compared to last year. When the ratio is above 20, the market is considered a seller’s market – which is when we see prices rise. When the ratio falls below 12, the market is a buyer’s market, where we see prices fall. Between 12 and 20 is “balanced.” Greater Vancouver’s SALR is technically balanced, but seeing prices fall already. The market is likely to see further declines as this continues to trend lower.
Greater Vancouver Condo Sales To Active Listings Ratio
The ratio of sales to active listings in Greater Vancouver. Higher ratios mean more pressure on prices to rise.
Source: REBGV, Better Dwelling.
The condo market is finally cooling down, but it’s doing so very quickly. This was the fewest sales for a January in almost a decade, and the highest inventory in nearly half a decade. Prices are starting to come down, but are still fairly distant from local incomes.
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I remember early last year, i was at the bosa residences presentation in lynn valley in north van. The realtor there was showing a $900K appt for the 2nd buillding (almost sold out then) and she told me to hurry since for the 3rd building the pricing will start over a million $ for a 2 bedroom….
There are TONS of development coming in Lower mainland this year and next…Question for those who paid a down-payment for the condo pre-sales from last year. Isn’t best to lose the down-payment now and buy the condo later at a lower price instead of continue paying a million for a shoe box that will go down in value anyway? I am not asking the flippers, but those who want to get into the market but are not rushed.
Maybe on a purely mathematical basis if you know exactly what the market will do… Unfortunately this is not how the world works. I think you’d be hard pressed to find someone who is willing to let go of their down payment because they are SO certain prices are going to continue to plummet.
If you are not rushed you might as well not put a down payment on anything and just wait it out.
An interesting thought, perhaps there would be a value in cutting your loss. It’s awfully hard from a psychological standpoint to lock in a loss like this.
For me the bigger question is this: with all the changes to mortgage laws will these folks be liquid enough/have enough income to actually close these deals?
To recap:
Stress test (exacerbated by tightening money supply globally)
Equity only evaluations going away
Lenders watching the fall in Vancouver RE prices and factoring it into their risk calculations (ie higher rates and more stringent conditions)
Not to mention changes in Taxes by the BC gov’t and the clamp down by the PBOC on capital leaving the country.
‘Hey pa, what’s that smell?’
‘Well son, that’s a shit slurry. If anyone thought the sunny ass crack of canada was able to sustain housing pricer greater than the economic engine of canada then they might as well believe in unicorns’
‘You mean unicorns aren’t real?’
BD4L. Clock has struck twelve. Watch as the blood floods the streets but i guess they have nicer weather right? Sweet lord.
Hi everyone… what is always on my mind is that in 2005 the price for condo was 250k and in 2016 is 700k. Does payments if citizens increased for almost 3 times? No. So whi were buying app? Someone from outside. So when this baloon blow his thing you will be left with people with salaries far more below. You will see then the real market picture. That is happening now. And i think that prices are for at least 30% (upto50%) more than it should be. That think many people here and star behaving like that so thats why there is a drop. So, we will see what will come. All the best