Buyers are turning on Vancouver real estate, as the epic run comes to an end. Real Estate Board of Greater Vancouver (REBGV) numbers show prices made a substantial decline in January. Falling prices came as a result of the multi-year high for January inventory, and a multi-year low for sales.
Greater Vancouver Home Prices Are Down Over 6% From Peak
The price of a typical home in Greater Vancouver is dropping. REBGV reported a benchmark composite home costs $1,019,600 in January, down 1.23% from the month before. This represents a 4.5% decrease year-over-year, or $36,900 lower. In the City, Vancouver West fell to $1,262,400, down 6.9% from last year. Vancouver East fell to $1,025,200, down 6.3% from last year. Yup, the price drops are real and the trend appears to be getting worse in the near term.
Greater Vancouver Composite Benchmark Price
The price of a typical home across Greater Vancouver, in Canadian dollars.
Source: REBGV, Better Dwelling.
The annual pace of growth is getting larger, and prices are down significantly from peak. The 4.5% decline in January is larger than the month before, and the largest we’ve seen since July 2009. Prices peaked in May 2018, and are down 6.85% across the region – a loss or savings of $74,400. People tend to think this isn’t that big, but it’s almost a year of pre-tax income for a typical Vancouver household. Working a year or two less to pay off a house is kind of a big deal.
Greater Vancouver Composite Benchmark Price Change
The annual percent change of a typical home across Greater Vancouver.
Source: REBGV, Better Dwelling.
Greater Vancouver Real Estate Sales Fall To 2009 Levels
Prices aren’t the only thing revisiting the Great Recession, sales are as well. REBGV reported 1,103 sales in January, up 2.9% from the month before. This represents a 39.3% decrease compared to the same month last year. The monthly increase is seasonal and expected. The annual decrease is different however, making it the fewest January since 2009.
Greater Vancouver Composite Sales Vs. Listings
The number of homes sold vs total inventory in Greater Vancouver.
Source: REBGV, Better Dwelling.
Greater Vancouver Real Estate Inventory Rises Over 55%
Time for an exit? New listings for Greater Vancouver real estate made a sudden surge last month. REBGV reported 4,848 new listings in January, up 244.6% from the month before. This represents a 27.7% increase from the same month last year. Once again, the monthly increase is expected, the annual isn’t so much.
The rise in new listings helped to push the total number of inventory higher. REBGV reported 10,808 active listings in January, up 5.2% from the month before. This represents a 55.6% increase compared to last year, and the highest Jan level since 2015.
Higher inventory and lower sales dropped the sales to active listings ratio (SALR). The SALR dropped to 10.2, a drop of 60.91% from last year. The market is considered a “seller’s market” when the ratio is above 20, and prices are expected to rise. The market is considered a “buyer’s market” when the ratio drops below 12, and prices are expected to drop. Between 12 and 20 is when the market is “balanced,” and prices are just right. We are currently in a buyer’s market, so pressure is on for prices to move lower.
The market saw a rise in inventory, and falling sales – producing lower prices. Inventory for January is the highest since 2015, putting the market right back before it’s epic run. Sales for January, have fallen to levels we haven’t seen since 2009. That might mean further problems for prices, as indicated by the SALR.
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Fake news! We all know that the reason Vancouver prices are high is because there are an unlimited number of rapacious, wealthy Chinese who will take any opportunity to hoover up Vancouver real estate inventory as soon as it hits the market. EVERYONE KNOWS IT’S TRUE. Therefore, it’s simply impossible for house sales to drop in The Very Best City in the Entire Universe. Impossible.
Sure Bob whatever you say
maybe Bob is right….look at the non-existent comments here vs Toronto’s…maybe only foreigners are buying/investing here, otherwise we should have a lot of comments here locals…
Who do you think reads this? The same people willing to mortgage themselves up to their eyes? I don’t think so…
I feel like bob was actually being quite sarcastic… at least that’s how I read it.
I read sarcasm. Many people refer to Vancouver as “Magical” and that prices are “here to stay”. Because it’s the “Best Place to Live in the World”
When really, it’s infested with drugs that kill more people than 9\11 every year, and theft and homelessness are rampant.
Prices are high due the lack of laws preventing money laundering. If they ever fix money laundering in this city, you can get your $600,000 detached house again because Vancouver salaries are an embarrassment.
I live and work here btw.
Of course it was sarcasm! Geez people.
As Skylar says, Vancouver is a city infested with drugs, the homeless, and horrifying traffic. But hey! Beaches and coffee and mountains amirite? Best damn drug-infested city in the whole universe! THAT’S WHY THE CHINESE WANT TO BE HERE.
Either that, or prices are actually the fault of locals who get a boner while watching HGTV.
Anybody relying on China and Chinese investors after the tax changes in China this year is living in a fantasy world. With the taxes just put on housing why would anyone want to play a 3% property tax annually. As a commercial Appraiser I can say that there is a revision going on on development land pricing as a result of the change in residential prices.
EMAIL –> MORNEAU & TRUDEAU
Dont loosen the stress test. Keep it as it is.
That’s their plan, and it will make/keep Vancouver RE un-affordable for average Vancouver households.
EMAIL, NOW !! or they will gut it for real.
Revision in commercial land value? Who is doing the revision?
The sake of one plot of land to a commercial group throws of the she’s data for 50 small businesses, because their are no other real comparables.
It’s resulting in property taxes in the 100s of thousands, for small to medium business owners.
They are leaving the address now, after settling the bill. Just an awful way to go out.
Sale* etc, etc, auto correct.
Sorry folks.
Please add a 3rd line to the “Greater Vancouver Composite Sales Vs. Listings” graph for the SALR ratio which would indicate the approximate sellers vs. buyers market status at any given data point.