Greater Vancouver real estate might be ready to wake from its slumber. Greater Vancouver Realtors, the board formerly known as REBGV, data shows the price of a typical home halted declines in November. Despite a 5-figure monthly decline just a few weeks prior, a sudden surge of sales helped to boost buyer sentiment. That sentiment was kept in check with an unseasonably high turnout of sellers.
Did Vancouver Real Estate Prices Find A Bottom?
The price of a composite benchmark (typical) home across Greater Vancouver.
Source: Greater Vancouver Realtors; Better Dwelling.
Greater Vancouver real estate prices may have just found a bottom—or they’re at least taking a break. The composite benchmark, or typical, home price was flat at $1.17 million in November. The minimal monthly shift starkly contrasts with the drop two months prior, when prices shed 1.4% (-$16.2k) over 30 days in September.
Greater Vancouver Real Estate Prices Aren’t Sure Where To Head
The annual change in the price of a composite benchmark (typical) home across Greater Vancouver.
Source: Greater Vancouver Realtors; Better Dwelling.
Greater Vancouver prices haven’t budged much despite the tepid demand over the past few years. The composite benchmark is only 0.9% (-$10.7k) lower than last November, and only down 6.9% (-$86.4k) since setting a record high. It’s worth noting home prices in the region didn’t soar during the recent low rate boom like most of Canada, mostly since prices are much higher. Prices are roughly the same as December 2021, and over the past 7 years showed a 1.6% compound annual growth rate (CAGR).
Vancouver Real Estate Sales Are Up, and So Is Inventory
Greater Vancouver real estate demand remains tepid but much better than last year. The board reported 2,181 sales through the MLS in November, up 28.1% since last year. Even with the huge annual growth, the volume is 12.8% below the seasonal average.
The slower-than-normal demand was met with unseasonably high inventory. There were 3,725 new listings in November, 10.6% more than last year and 5.4% above the 10-year average. That helped to push active listings to 13,245 homes, up from last year (+21.2%) and the 10-year average (+26.1%). There is a lot more inventory than usual, not what most imagine when hearing that prices have suddenly stopped falling.
Greater Vancouver is a relatively tight market, especially at this time of year. As a result, beating the historical average for new and active listings only put the market in balanced territory. The sales to active listings ratio (SALR) was 17.5% in November, towards the upper end of the balanced range in the board’s preferred measure. The CREA-preferred sales to new listings ratio (SNLR) was a similar 58.5% last month, also in balanced territory.
Balanced. It is worth emphasizing the word since industry bulls have been emphasizing the growth in sales, while bears emphasize the inventory surge. Both of the above demand measures expect no price movement when in balanced territory, and that’s what happened. Though the activity is climbing uncharacteristically into the winter, a sign that rate cuts are playing a role in driving market sentiment. Sentiment-driven markets can fade or turn into exuberance very quickly.
