Greater Vancouver real estate is starting to see some signs of price growth cooling. Real Estate Board of Greater Vancouver (REBGV) data shows home prices hit a new high in May. It did so with the annual monthly growth accelerating even faster.
However, the monthly price increase was much smaller than the one made in the previous month. Falling month-over-month growth follows an increase in the number of new listings. As pressure for prices to move higher releases, the possibility of a much more tame market is brewing.
Vancouver Home Prices See Monthly Price Increase Cut Nearly In Half
Greater Vancouver home prices are rising at an unbelievably rapid rate. The composite home hit a benchmark price of $1,172,800 in May, up 1.5% ($17,332) from the previous month. There’s no other way to put it — this is a massive price increase. However, the growth is almost half the size seen in the previous month. The market may be getting cooler… but it was so scorching hot, it may not be noticeable to many that aren’t watching it like a hawk.
Greater Vancouver Composite Benchmark Price
The price of a typical home across Greater Vancouver, in Canadian dollars.Source: REBGV, Better Dwelling.
Compared to a year ago, composite prices are a mind-blowing 14.0% ($144,028) higher. This is well over the size of the median household’s annual income in the region. On a medium-term basis, prices are up 7.1% ($77,748) over the past 3-years. Annual price growth is big, but largely retracing some of the ground lost pre-pandemic.
Vancouver Detached Homes Saw Monthly Growth Cut… But It Was Still $30,000
Breaking it down, we can see that detached homes are the big driver of the composite’s price growth. The benchmark price of a detached home reached $1,800,600 in May, up 1.7% ($30,099) from a year before. This is roughly half of the monthly increase seen a month before as well. It’s still a ridiculously large number for home prices to rise in a month. But that tells us just how frothy gains have been over the past year.
Greater Vancouver Composite Benchmark Price Change
The annual percent change of a typical home across Greater Vancouver.Source: REBGV, Better Dwelling.
Compared to a year before, prices are now 22.8% ($334,313) higher. Over the past 3-years, prices are up a slightly lower 12.3% ($197,216). Detached homes are so expensive in Vancouver, even modest growth is still a giant dollar value.
Vancouver Condo Prices Are Only 3% Higher Than 3 Years Ago
Condo apartment prices are losing some of the steam they acquired just a few months ago. The benchmark condo reached $737,100 in May, up 1.2% ($8,740) from the month before. Once again the monthly growth fell in size, but it’s still a very high rate of growth. Some pressure is being relieved though.
Compared to a year ago, prices are 7.9% ($53,967) higher, but only 2.8% ($20,077) higher than 3 years ago. Over 3 years prices appreciated less than most of these units would collect in rent. Recent price growth has been accelerating very quickly though.
New Listings For Vancouver Homes Are Releasing Some Pressure
Home sales and inventory are such a big topic for this market, we’ll do a deep dive into it later this month. I am going to quickly run through the sales to new listings ratio (SNLR), which has been a big focus these past few months. The ratio fell to 59.9% in May, meaning a balanced market arrived. The inflow of new inventory is enough to relieve at least some of the pressure from the high home sale volume.
The SNLR is still much higher than last year, but those were odd circumstances. It was just a few months after the onset of the pandemic, and there was significant fear about the rules. Still, the ratio is a sharp decline from the peak ratio seen a few months ago, in March. Back then demand was far outstripping the inflow of new supply, and buyers were panic buying.
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