The May MLS housing market statistics from the Real Estate Board of Greater Vancouver are in and they indicate a market that is returning to a more typical pace. Sales declined while active listings rose, but this did little to quell benchmark price increases which still rose month-over-month across all product types.
The month-over-month decline in sales and the increase in active listings saw sales-to-active listings ratios decline between 15 and 23 percent depending on product type, though they remain firmly in seller’s market territory.
Sales remain high compared to historical averages, but May’s month-over-month declines are still significant market indicators, spurred on by the new increased stress test, rising interest rates, and other economic issues tied to the Covid “restart” process.
Despite these market dampening factors, the increase in active listings means that prospective home buyers will have more choices and, while the prospect of interest rates going up is high, the rates themselves will likely remain relatively low historically speaking, which will continue to drive local demand. Demand is also likely to pick back up as more of the world is vaccinated and people are travelling and immigrating at higher rates again. The frenzied “pandemic market” we have been experiencing has largely been driven by local home buyers, and not necessarily supported by newcomers to Vancouver. These factors will continue to push the market in the latter half of 2021 and into 2022.
SO WHAT DOES THIS MEAN FOR DEVELOPMENT LAND?
We are starting to see a shortage of development sites again across our core markets North of the Fraser however, this may be short-lived if buyers get cold feet and don’t remove subjects on deals currently under contract.
The demand for slab on grade townhouse and single family development sites seems to be insatiable but these types of sites continue to be few and far between. Medium-density sites have become increasingly coveted as well, with more buyers in the market than there are available sites.
On the other hand, high-rise development sites continue to be the slowest market, but not without a pulse! Vendors of this type of land can expect to give extended subjects as buyers are taking their time to complete in-depth due diligence and weigh whether or not to take on the huge risk associated with high-rise projects
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 May 2021 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.