Vancouver real estate prices are back to defying gravity. June numbers from the Real Estate Board of Greater Vancouver (REBGV) show the typical home in Greater Vancouver is just shy of a million dollars now. No, not detached units. The typical price of all units combined. Generally speaking, the market saw prices soar to insane heights, sales drop, and inventory build.
Vancouver Real Estate Prices Rose $1,006 Per Day In June
Vancouver real estate prices are back to dizzying heights, this time bringing all home types with it. The composite benchmark price reached $998,700, a 7.9% increase from the same time last year. This number is also a massive 1.8% jump from the month before. I know Canadians have a total detachment from how much real estate prices typically rise, so let’s put it into context. The composite price rose an average of $1,006 per day last month.
The interesting thing is these are composite prices, which includes all home types. Last year’s rise was driven by detached units, where buyers paid a premium because Vancouver was running out of land in their opinion. Now that the detached market is softer this time around, the majority of these sales are “lower priced” units pushing the pricing floor higher. A home is only worth what people are willing to pay, but a $1,006/day premium?
Greater Vancouver Sales Decreased 11.5%
The number of sales are showing a large decrease. The market saw 3,893 sales, an 11.5% decrease from the same month last year. This also represents a 10.8% decline from the month prior. Sales are expected to taper as prices inch higher, since people become priced out of the market. Surprisingly, some people can’t stomach the $1k/day hike.
Greater Vancouver Listings Increased 9%
Listings had a large increase, leading to much more inventory in the market than last year. REBGV had 8,515 active listings at the end of the month, which is 9% higher than the same time last year. This is a 4% increase from the month before.
There’s a couple of points to take away from this number, historical context and compared to sales. The number of listings is higher than last year, but still 30% lower than it was in 2015. It feels like more inventory, but when compared to the long term trend it’s actually fairly low. This shouldn’t really matter however, since sales are declining. Less sales and more inventory usually relieves pricing pressure, not increases it.
The market this time around is being driven by first-time buyers, fueled with cheap subprime loans from the government of BC. These people aren’t exactly the best category of buyers to be driving the market, but here we are. $1,006/day higher than we were the month before. As always, we’ll breaking down the market segment by segment over the next few days.
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