continued swoon or comparative boom?
Participation in the housing market in the Vancouver Region waned in June, as both sales and inventory dipped. In part we have the warm weather and the success of the vaccine to thank.
Notably, inventory fell on a month-over- month basis in June for the first time in four months, at a time of year when inventory is typically expanding (on average by 2% between May and June over the past decade). With sales and inventory waning, this same- direction recalibration of both demand and supply has had little effect on overall market conditions, which continue to favour sellers, albeit to a lesser extent than a few months ago. In turn this has meant that prices have more or less remained even as sales have sagged, with the region’s average sold price of $1.12 million in June down only 2% from March’s $1.14 million. When our province moves to Step 4 of its re- opening plan in September, our respite from an overly-active housing market may come to an end. Until then, however, expect activity to be muted through July and August.
At the time of this report’s writing, things are looking up for denizens of the Vancouver Region: summer and its heat are upon us (ok, maybe it’s been a bit too much heat), 80% of eligible British Columbians have received at least one dose of the Covid-19 vaccine (and 41% are fully vaccinated), and the province has transitioned to Step 3 of its Covid-19 re-opening plan. Add it all up, and it’s very likely that a sizeable proportion of our population will be focussed more on seeing friends and family, and vacationing, than buying and selling real estate during the summer months. In considering this change in focus from homes to humans that will likely characterize the next couple of months, it’s worth asking if the transition already began in June. Indeed, the province moved from Step 1 to Step 2, allowing for more interpersonal contact,
frequenting of food and drink establishments, and mobility; at the same time, MLS sales in the Vancouver Region fell for the 3rd straight month, from an all-time peak of 8,898 back in March to “only” 5,963 in June. Compared to the previous month, June’s sales were down 16%, when a typical May-to-June sales count change is a decline of 2%. So while one and two data points do not a trend make, we now have three—as in three months of declining sales—so it seems safe to say we are truly coming off of the historic highs achieved earlier in the year. And these highs are not likely to be re-attained in the foreseeable future. Having said that, it’s worth noting that June’s just-shy-of-6,000 sales were the most in any month in the pre-Covid era, going all the way back to June 2017. It seems clear, then, that the demand side of the market has some room to run still.
Copyright © 2021 rennie group of companies. All rights reserved. This material may not be reproduced or distributed, in whole or in part, without the prior written permission of the rennie group of companies. Current as of July 5, 2021. All data from Real Estate Board of Greater Vancouver and Fraser Valley & Rennie. While the information and data contained herein has been obtained from sources deemed reliable, accuracy cannot be guaranteed. rennie group of companies does not assume responsibility or liability for any inaccuracies. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information contained within this report should not be used as an opinion of value, such opinions should and can be obtained from a rennie and associates advisor. All information is subject to change and any property may be withdrawn from the market at any time without notice or obligation to the recipient from rennie group of companies. E.&O.E. 3
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