Vancouver real estate may be booming, but someone forgot to tell detached buyers. Numbers from the Real Estate Board of Greater Vancouver (REBGV) continue to show a slide in demand. While the benchmark price has hit a fresh all-time high, growth fell to a multi-year low when compared .
Benchmark Prices Increased Slower Than Inflation
The benchmark price of detached homes grew, but barely. The price is now $1,587,900, a 1.4% increase from the same time last year. This also represents a 1.1% increase from the month before – that’s $26,900 more in human terms. The 1.4% increase from last year is the slowest since November 2013. Worth noting this means prices have surpassed July 2016’s all-time high for the benchmark.
This isn’t all good news however, here’s some context. Canada’s Consumer Price Index (CPI) has averaged 1.5% annual growth for the past decade. This means Vancouver detached prices are rising slower than one measure of inflation, showing that real prices (those that are inflation adjusted) have reached negative for the first time in years. If detached prices don’t pick up soon, we’ll likely see the benchmark fall, something not seen since October 2013.
Listings Increased Slightly
Listings across the GVR rose, but didn’t see a huge increase. There were 2,647 detached listings, representing a 1.1% increase from the same time last year. Compared to the month prior, this is a 0.4% decrease. Vancouver West and Richmond saw the largest increase in listings, rising 22.2% and 18.5% month-over-month respectively. The outskirts saw this biggest decreases in inventory monthly, with Whistler listings dropping 26.3%, and Port Coquitlam getting a 23.5% decline.
Sales Declined By 15.62%
Detached sales across the REBGV showed a significant decline. June saw 1,312 detached sales, a 15.62% decline from the same time last year. Month-over-month showed a similar decline, dropping 15.1% from May. The number of sales dropping is expected as prices climb, but typically listings decline as well. As the gap between sales and listings increases, expect further restriction on price growth – or price declines.
Despite the benchmark hitting an all-time high, there’s a few roadblocks to keep an eye on. The REBGV market is experiencing robust growth, largely driven by subprime loans from the provincial government. That first-time buyer loan can’t really do a lot for those $1.5 million detached units. Unless listings start dropping, and sales start picking up – this could get messy for the detached market, fast.
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Photo: Tim Gage.