One month doesn ’ t make a trend , sure—but what about two? Benchmark prices increased in the Vancouver Region for the second consecutive month, even as borrowing costs remain elevated. The enduring sellers’ market reflects increasing sales counts against a backdrop of stagnant inventory.
months-of-inventory (MOI) measure for the Vancouver Region declined to 2.9 in March—reflecting an entrenched sellers’ market (note: a sellers’ market is denoted by 5.0 or less MOI). Furthermore, conditions now favour sellers across the markets for each home type (detached homes, townhomes, and condos). Not surprisingly and as already noted, benchmark prices increased again in March, this time by an average of 1.9% (detached home prices increased 2.4%, townhomes 2.0%, and condos 1.0%). That the Bank of Canada is likely to continue to hold its trend-setting interest rate where it is for the foreseeable future means that, going forward, there’s more macroeconomic clarity for both potential buyers and sellers. However, unless the latter group stimulates an expansion of resale housing supply, it’s more than likely that the most recent two- month upward price trend will continue for some months to come.
To put numbers to it, there were 4,022 sales in the Vancouver Region in March, which was a 50% increase from February and the first time sales surpassed the 4,000 mark since last May (and the first time above 3,000 since June). Last month’s sales count, however, was 41% lower than in March 2022, and 25% below the past 10-year March average. Inventory, meanwhile, was relatively stagnant, with March wrapping with only 11,758 homes available—a modest 3% increase from February and much less than the typical February-to-March increase of 7%. Overall, inventory now sits 25% below the long-run March average. With the pace of sales increasing alongside barely-expanding inventory, market conditions have shifted considerably in the past two months. Specifically, the
It’s now been one year since the Bank of Canada embarked on its aggressive interest rate tightening cycle, and much of the past year has been characterized by weakened housing market activity and declining prices. And so it came as a bit of a surprise to some when, in February, overall benchmark prices in the Vancouver Region increased on a month-over-month basis for the first time (with the exception of condos) since last spring. We noted in this space last month that not only was overall inventory well below typical levels, but when you dig a little deeper into the listings that are available, supply is even more constrained than it first appears. And as the market progressed through March—a typically busy month for both sales and new listings—the pace of sales did in fact quicken, while listings failed to keep pace, thereby yielding another month of price growth.
Copyright © 2023 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 April 4, 2023. 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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