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More choice, lower prices: Why now may be a good time to buy real estate in Vancouver
May 07, 2019

A new quarterly report on the Metro Vancouver housing market says there's a high degree of vulnerability in the market, but prices are down, and inventory is up, which means buyers will find some advantage.

According to the Canada Mortgage and Housing Corporation (CMHC), the region's soaring real estate prices have cooled since last June's highs — down about seven or eight per cent — while the rest of the economy has remained strong.

"This housing market assessment is an early warning system for vulnerabilities in the housing market," said Eric Bond, market analyst with CMHC. "The degree of imbalance between home prices and the local economy is narrower than it has been at any point in the last several years." 

According to Bond, over the last two years, the inventory of homes for sale in Metro Vancouver has been about 400 units, but now, for multi-family units, there's closer to 1,100 active listings.

He said that's still very low, relative to the population, but it means there's more choice for buyers.

"In many ways this is an opportunity for them to explore more options, and also to take their time making a purchase and putting reasonable conditions on that offer," said Bond.

Still plenty of risk

But according to Josh Gordon, assistant professor at Simon Fraser University's school of public policy, buyers may want be careful.

Gordon said a lot of the risk in the market relates to how much money people have borrowed to afford the homes they already own — and lower prices now won't change that.

"You have a period of high prices that are not really closely aligned to people's purchasing power, and where people have borrowed a lot of money to get into the housing market," he said.

Gordon added that people who have paid high prices for their homes are vulnerable to the possibility of rising interest rates, rising unemployment, or some other macro-economic shock. 

He said the frenzied bidding wars of the past few years are behind us, and buyers can now enjoy prices that are cooling off, but that doesn't mean now is the time to buy.

"Conditions have definitely improved for buyers, but that doesn't mean that buyers should not still be very cautious in this market," said Gordon.

"Prices have fallen and may continue to do so and so they should be aware of that possibility.

Source: Rafferty Baker: CBC News

April Stats
May 02, 2019

Reduced demand and increased supply remain the trend across Metro Vancouver’s housing market

Decreased demand continues to allow the supply of homes for sale to accumulate across the Metro Vancouver housing market.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,829 in April 2019, a 29.1 per cent decrease from the 2,579 sales recorded in April 2018, and a 5.9 per cent increase from the 1,727 homes sold in March 2019.

Last month’s sales were 43.1 per cent below the 10-year April sales average.

“Government policy continues to hinder home sale activity. The federal government’s mortgage stress test has reduced buyers’ purchasing power by about 20 per cent, which is causing people at the entry-level side of the market to struggle to secure financing,” Ashley Smith, REBGV president said. “Suppressing housing activity through government policy not only reduces home sales, it harms the job market, economic growth and creates pent-up demand.”

There were 5,742 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in April 2019. This represents a 1.3 per cent decrease compared to the 5,820 homes listed in April 2018 and a 16 per cent increase compared to March 2019 when 4,949 homes were listed.

The total number of homes currently listed for sale on the MLS® in Metro Vancouver is 14,357, a 46.2 per cent increase compared to April 2018 (9,822) and a 12.4 per cent increase compared to March 2019 (12,774).

“There are more homes for sale in our market today than we’ve seen since October 2014. This trend is more about reduced demand than increased supply,” Smith said. “The number of new listings coming on the market each month are consistent with our long-term averages. It’s the reduced sales activity that’s allowing listings to accumulate.”

The overall sales-to-active listings ratio for April 2019 is 12.7 per cent. By property type, the ratio is 9.4 per cent for detached homes, 15.4 per cent for townhomes, and 15.3 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,008,400. This represents an 8.5 per cent decrease over April 2018, and a 0.3 per cent decrease compared to March 2019.

Detached home sales totalled 586 in April 2019, a 27.4 per cent decrease from the 807 detached sales in April 2018. The benchmark price for a detached home is $1,425,200. This represents an 11.1 per cent decrease from April 2018, a 0.8 per cent decrease compared to March 2019.

Apartment home sales totalled 885 in April 2019, a 32.3 per cent decrease compared to the 1,308 sales in April 2018. The benchmark price of an apartment is $656,900 in the region. This represents a 6.9 per cent decrease from April 2018 and is unchanged from March 2019.

Attached home sales totalled 358 in April 2019, a 22.8 per cent decrease compared to the 464 sales in April 2018. The benchmark price of an attached home is $783,300. This represents a 7.5 per cent decrease from April 2018 and is unchanged from March 2019.

Download the April 2019 stats package.

Canadian home prices to stay flat through spring market: Royal LePage
Apr 04, 2019

Canada’s housing market will remain slow for the rest of the year, with home prices expected to remain relatively flat through the typically-busy spring market, according to a new report from Royal LePage.

“We are expecting this to be a sluggish year overall in Canada’s residential real estate market, with the hangover from the 2018 market correction and weaker economic growth acting as a drag on home price appreciation, balanced by lower for longer interest rates,” Royal LePage President and CEO Phil Soper said in a survey released Thursday.

The forecast, which sees the national aggregate price of a home rising 1.0 per cent over the next three months, comes on the heels of new data from two of the country’s most closely-watched housing markets. The Toronto Real Estate Board reported flat sales for the month of March on Tuesday, while Vancouver’s real estate board painted a different picture when it reported sales in the region sank 31.4 per cent year-over-year for the month on Monday.  

The market pegged to have the strongest price growth in the second quarter is the nation’s capital, with Royal LePage anticipating 2.8 per cent price appreciation in Ottawa. The report noted that prices in the city rose 7.7 per cent year-over-year in the first quarter, on the back of strong tech and government employment, placing the region’s home prices above Calgary’s for the first time ever.

Despite calls from the Toronto board to revisit some of the government’s mortgage policies – like the Office of the Superintendent of Financial Institutions’ B-20 stress tests – home prices remain high, Soper said. He added that this year’s slowdown will benefit buyers.

“There is a silver lining here,” he said. “This slowdown gives buyers, and first-time buyers in particular, an opportunity to buy real estate in our country’s largest cities.”  

Royal LePage added that the federal government’s recent initiatives to help first-time homebuyers is a “welcome and necessary” development despite concerns from critics that the measures will overstimulate already-expensive markets.

“Without a healthy influx of first-time buyers, the entire cycle of real estate activity can stall,” Soper said. “There is the chance, however, that activity levels in the spring of 2019 will be reduced as some delay purchases, waiting for the First-Time Home Buyer Incentive to kick-in.”

Source: Nicole Gibillini: BNN Bloomberg

March Stats
Apr 02, 2019

Prospective home buyers remain on the sidelines in March

Metro Vancouver home sales dipped to the lowest levels seen in March in more than three decades.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,727 in March 2019, a 31.4 per cent decrease from the 2,517 sales recorded in March 2018, and a 16.4 per cent increase from the 1,484 homes sold in February 2019.

Last month’s sales were 46.3 per cent below the 10-year March sales average and was the lowest total for the month since 1986.

“Housing demand today isn’t aligning with our growing economy and low unemployment rates. The market trends we’re seeing are largely policy induced,” Ashley Smith, REBGV president said. “For three years, governments at all levels have imposed new taxes and borrowing requirements on to the housing market.”

“What policymakers are failing to recognize is that demand-side measures don’t eliminate demand, they sideline potential home buyers in the short term. That demand is ultimately satisfied down the line because shelter needs don’t go away. Using public policy to delay local demand in the housing market just feeds disruptive cycles that have been so well-documented in our region.”

There were 4,949 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in March 2019. This represents an 11.2 per cent increase compared to the 4,450 homes listed in March 2018 and a 27.2 per cent increase compared to February 2019 when 3,892 homes were listed.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 12,774, a 52.4 per cent increase compared to March 2018 (8,380) and a 10.2 per cent increase compared to February 2019 (11,590).

For all property types, the sales-to-active listings ratio for March 2019 is 13.5 per cent. By property type, the ratio is 9.4 per cent for detached homes, 15.9 per cent for townhomes, and 17.2 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,011,200. This represents a 7.7 per cent decrease from March 2018, and a 0.5 per cent decrease compared to February 2019.

Sales of detached homes in March 2019 reached 529, a 26.7 per cent decrease from the 722 sales in March 2018. The benchmark price for a detached home is $1,437,100. This represents a 10.5 per cent decrease from March 2018, and a 0.4 per cent decrease compared to February 2019.

Sales of apartment homes reached 873 in March 2019, a 35.3 per cent decrease compared to the 1,349 sales in March 2018. The benchmark price of an apartment property is $656,900. This represents a 5.9 per cent decrease from March 2018, and a 0.5 per cent decrease compared to February 2019.

Attached home sales in March 2019 totalled 325, a 27.1 per cent decrease compared to the 446 sales in March 2018. The benchmark price of an attached home is $783,600. This represents a six per cent decrease from March 2018, and a 0.7 per cent decrease compared to February 2019.

Download the March 2019 stats package.

Housing statistics yield surprises about non-resident ownereship
Mar 26, 2019

Canada Mortgage and Housing Corp.’s latest housing market insight report grabbed headlines last week thanks to the details it provided on non-resident ownership of residential real estate in Metro Vancouver and B.C. as a whole last year.

When it comes to properties owned exclusively by non--resident owners, B.C. isn’t much different from Nova Scotia, at 3.7%. However, the report indicated that Metro Vancouver leads the country when it comes to foreign ownership, with 4.9% of residential properties owned exclusively by non-resident owners. Apartments appear to be the most appealing property type for non-resident owners; in Metro Vancouver, 8.3% are owned by non-residents. The largest concentration in the region is at the University of British Columbia (UBC), where 19.6% of apartments and 16.9% of all residential properties are foreign-owned.

This is consistent with the 2016 census data that indicated 26.6% of units at UBC were not occupied by their usual residents on census day.

But diving into the latest ownership data yields some surprising revelations.

The areas with the highest proportion of foreign-owned residences after UBC include Telegraph Creek (13.5%), Greenwood (11.9%), the West Chilcotin (11.7%) and the tiny community of Bamfield on the west coast of Vancouver Island (9.9%).

Similarly, the issue of foreign-owned condominium apartments (if an issue it is) isn’t limited to UBC or Metro Vancouver. Right up there with the double-digit rate at UBC is the area west of Greenwood to the summit of Anarchist Mountain and Big White ski resort, where 17.9% of condos have non-resident owners.

Foreign landowners

Speculation was a big issue during the public consultation on ways to revitalize the Agricultural Land Commission and the 11.6 million acres it oversees. Concerns over purchases of protected farmland in areas like Richmond for the purpose of raising houses rather than crops tied many knickers in knots.

But data from the Canadian Housing Statistics Program of Statistics Canada indicates that Richmond ranks 25th in the province when it comes to foreign ownership of vacant residential land, at just 7%. Metro Vancouver as a whole posts a rate of 2.5%.

These seem tame compared with Lions Bay, where non-resident ownership of vacant land checks in at 25%. Greenwood follows with 19.3% of vacant land in foreign hands. Central Okanagan is in third place, with 15% of properties owned by non-residents, while Alert Bay and Dease Lake both have 14.3% of their lands owned by non-residents.

Ranks of appeal

The data regarding non-resident ownership can also be read as an indication of which markets are most desirable to outside investors. In this case, Metro Vancouver wins hands down at 4.9%.

The three other metropolitan areas in B.C. on which Statistics Canada reports all have lower rates of non-resident ownership of residential properties. To no one’s surprise, the capital region comes in second with a foreign ownership rate of 3%. Kelowna, the metropolitan hub of B.C.’s Interior, reports a foreign ownership level of 2.7%. 

Source: Peter Mitham: BIV

Canadian housing slump deepens with first drop in decades
Mar 14, 2019

Canadian home values fell last year for the first time in three decades amid falling prices in some of the country's priciest markets, even as debt burdens increased.

The value of residential real estate in Canada dropped $30 billion in the fourth quarter to $5.10 trillion, from $5.13 trillion in the same quarter the previous year, Statistics Canada reported Thursday. The 1.4 per cent decline is the first decrease in country-wide home values in data going back to 1990.

Households meanwhile saw their debt burdens rise at the end of last year, with the debt to disposable income ratio hitting a record 174 per cent in the fourth quarter. The worsening reflects a sharp slowdown in economic growth at the end of last year.

Canadians are also spending a larger proportion of their income on servicing that debt. The debt service ratio -- the proportion of a household's income that goes to paying off principal and interest on debt -- rose to 14.9 per cent in the quarter, the highest level since the fourth quarter of 2007.

Source: Erik Hertzberg; Bloomberg News

February stats
Mar 04, 2019

Housing market conditions continue to favour home buyers

The Metro Vancouver housing market saw increased supply from home sellers and below average demand from home buyers in February.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,484 in February 2019, a 32.8 per cent decrease from the 2,207 sales recorded in February 2018, and a 34.5 per cent increase from the 1,103 homes sold in January 2019.

Last month’s sales were 42.5 per cent below the 10-year February sales average.

“For much of the past four years, we’ve been in a sellers’ market. Conditions have shifted over the last 12 months to favour buyers, particularly in the detached home market,” Phil Moore, REBGV president said. “This means that home buyers face less competition today, have more selection to choose from and more time to make their decisions.”

There were 3,892 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in February 2019. This represents a 7.8 per cent decrease compared to the 4,223 homes listed in February 2018 and a 19.7 per cent decrease compared to the 4,848 homes listed in January 2019.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 11,590, a 48.2 per cent increase compared to February 2018 (7,822) and a 7.2 per cent increase compared to January 2019 (10,808).

For all property types, the sales-to-active listings ratio for February 2019 is 12.8 per cent.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“Homes priced well for today’s market are attracting interest, however, buyers are choosing to take a wait-and-see approach for the time being,” Moore said. “REALTORS® continue to experience more traffic at open houses. We’ll see if this trend leads to increased sales activity during the spring market.”

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,016,600. This represents a 6.1 per cent decrease over February 2018, a 6.2 per cent decrease over the past six months, and a 0.3 per cent decrease compared to January 2019.

Sales of detached homes in February 2019 reached 448, a 27.9 per decrease cent from the 621 detached sales recorded in February 2018. The benchmark price for detached properties is $1,443,100. This represents a 9.7 per cent decrease from February 2018, a 7.6 per cent decrease over the past six months, and a 0.7 per cent decrease compared to January 2019.

Sales of apartment homes reached 759 in February 2019, a 35.9 per cent decrease compared to the 1,185 sales in February 2018. The benchmark price of an apartment property is $660,300. This represents a four per cent decrease from February 2018, a 5.1 per cent decrease over the past six months, and a 0.3 per cent increase compared to January 2019.

Attached home sales in February 2019 totalled 277, a 30.9 per cent decrease compared to the 401 sales in February 2018. The benchmark price of an attached unit is $789,300. This represents a 3.3 per cent decrease from February 2018, a 6.7 per cent decrease over the past six months, and a 1.4 per cent decrease compared to January 2019.

Download the February 2019 stats package.

Looking for a luxury home? It's 'a great time to buy", real estate company says
Feb 26, 2019

If you're looking to upgrade to a luxury house or condo in Metro Vancouver, a Canadian real estate company says it might be a good time to make the move.

A newly released report by Royal LePage forecasts a 7.1-per-cent drop in the median price of a luxury home in the region in 2019. That's a difference of about $410,000.

“Luxury properties in Greater Vancouver are softening in price, but the lower-end luxury market is faring better than the upper-end,” sales representative Brock Smeaton said in the report.

“For buyers considering the city’s most luxurious properties, it is a great time to buy in terms of price and selection.”

 

Between January 2018 and January 2019, the period studied in the report, the median price of a luxury home in Greater Vancouver fell by 1.7 per cent to about $5.75 million, the document said.

According to Royal LePage, the median price of luxury condos in the region also fell, albeit only by 0.6 per cent to about $2.68 million.

“We have a growing number of buyers sitting on the sidelines watching prices, but they are also concerned about the unpredictability of government regulation and whether right now is the best time to buy,” Smeaton said.

The most dramatic change was in the number of luxury properties changing hands. According to the report, luxury home sales declined for a second year in a row, falling 50.5 per cent during a time period student. When it came to condos, that number was 30.2 per cent, LePage said.

Source: CTV Vancouver

First-of-its-kind registry in B.C. targets under-the-radar condo flippers
Feb 25, 2019

VICTORIA -- The British Columbia government says it has launched Canada's first registry aimed at cracking down on pre-sale property flipping and tax evasion in B.C.'s real estate market.

The Ministry of Finance says the Condo and Strata Assignment Integrity Register will improve fairness and transparency in property transactions.

Finance Minister Carol James says in a news release that the register will take "real action to moderate the condo market," and is already starting to see results in Metro Vancouver.

Condo developers will be required to securely gather and report the identity and citizenship of anyone completing a contract assignment in a project.

A contract assignment occurs when a buyer sells, or "flips," their purchase contract of a condo to another buyer, often at a higher price, before construction of the building is complete.

Currently flipping can occur without any oversight and the province says the practice has been a factor in raising real estate prices while facilitating tax evasion when capital gains and other taxes are not applied.

"For too long, speculators and tax evaders have been taking advantage of loopholes in our real estate market, driving up prices and shutting British Columbians out of the market," James says in the news release.

The finance ministry says it's unknown how many pre-sale property flips occur each year because the transactions aren't reported.

Developers are now required to collect and record assignment information and file a report each quarter, with the first due April 30, covering the period from Jan. 1 to March 31, 2019.

"The B.C. government will use this information to ensure that people who assign condos are paying the appropriate income tax, capital gains and property transfer tax," the release says.

The filing fee per assignment is $195, which the government says is a small fraction of the cost of flipping a condo unit.

The register is one part of the New Democrat government's 30-Point Housing Plan to address housing affordability.

Source: The Canadian Press

Policy-induced Housing Slowdown Continues into 2019
Feb 15, 2019

Vancouver, BC – February 15, 2019. The British Columbia Real Estate Association (BCREA) reports that a total of 3,546 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in January, a decline of 33.2 per cent from the same month last year. The average MLS® residential price in the province was $665,590, a decline of 7.7 per cent from January 2018. Total sales dollar volume was $2.36 billion, a 38.4 per cent decline from the same month last year.

“BC households continue to grapple with the policyinduced affordability shock created last year by the federal government,” said Cameron Muir, BCREA Chief Economist. “The resulting pullback in consumer demand is largely responsible for January’s lacklustre performance.”

Total MLS® residential active listings increased 41.2 per cent to 29,522 units compared to the same month last year. The ratio of sales to active residential listings declined from 25.4 per cent to 12 per cent over the same period.

“Many BC regions are now exhibiting buyer’s market conditions,” added Muir. “However, BC Northern, the Kootenay, Okanagan Mainline and the Vancouver Island markets continue to reflect balance between supply and demand.”

Source: BCREA

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