The Real Estate Board of Greater Vancouver has released the data for July and the trend of lower demand from home buyers and increase in the number of properties available for sale have continued. Although a decline in market activity and slight increase in inventory is typical for this time of year, the data shows figures that are beyond the “normal” trend of even the quietest summer months. To illustrate, sales in July were down 22.8% compared to this past June, and down a stunning 43.3% compared to the same month last year, making it clear that the housing market is being impacted by increasing interest rates and relentless inflation.
Looking at the average percentage of original sale price, all product types decreased this past month with detached homes leading the charge at 1.8% and townhomes & condos following behind at 1.5%. Days on market increased substantially across all property types as townhomes, detached homes and condos spent 33.3%, 25% & 23.5% more time on the market compared to the previous month.
Benchmark pricing decreased for the second consecutive month across all homes – the results were as follows:
- Detached Homes: -2.8%
- Townhomes: -1.7%
- Condos: -1.5%
Lastly, the market for detached homes and townhomes is now considered to be balanced as the sales to active ratio for each is 11.8% and 20% respectively, decreasing from the previous month by 17.5% & 36.5%. The condo market is still hanging on in the ‘Seller’s market’ territory, as sales to active ratio is currently 24.5%, a 18.9% decrease from the previous month.
The attitude of purchasers has significantly changed over the past several months; formerly, buyers were more inclined to make an offer on a house even if it compromised some of their core demands or aspirations. With time once again on their side, purchasers are considering the location, features, lot size, and even now including a subject period in their offer without having to worry about engaging in a bidding war.
What does this mean for development land?
Development land is still in demand and we’ve yet to see serious price relaxations; however, since properties are actually making it to the market and/or staying on the market for longer, sellers are allowing for longer due diligence periods, longer completions, and in some cases they are adjusting their pricing expectations in order to close the gap between theirs and the buyer’s expectations. How long will this continue to be the case? We can’t be sure. What we are sure of is that while some buyers hesitate to make purchases and continue to watch from the sidelines, others are actively jumping in with both feet and continuing with their long-term acquisition strategy, just at more attractive terms than a few months ago.
Please note: areas covered by the Real Estate Board of Greater Vancouver include: Whistler, Sunshine Coast, Squamish, West Vancouver, North Vancouver, Vancouver, Burnaby, New Westminster, Richmond, Port Moody, Port Coquitlam, Coquitlam, Pitt Meadows, Maple Ridge, and South Delta.
View the Real Estate Board of Greater Vancouver’s entire stats package for July 2022 here.
This representation is based in whole or in part on data generated by the Real Estate Board of Greater Vancouver which assumes no responsibility for its accuracy.