Less than a year after the foreign buyer’s tax was implemented in the Vancouver area, sales of detached homes continue to slide.However, the demand for condominiums is outstripping supply. Although condo sales in the lower mainland have dipped 8.5% from last year at this same time, there were over 1900 units that were moved in June. Regardless of the dip in sales, competition is at an all time high which Is creating multiple offer scenarios for many condo sellers.
Sales To Active Listing
This is most prevalent when you look at the sale to the active listing ratio for June which is 93.2%. A balanced market in the condominium market is considered to be between 14-20%. “ It is simply a matter of supply and demand. Condominiums are in high demand right now, and the amount of listings for sale in condominiums is relatively low.” Said REBGV president Jill Oudil.
Having to Pay More For First Time Buyers
First time home buyers have to pay to get into an apartment or condo. With the bidding wars prevalent in condo sales, the benchmark price is a whopping $600,000. That price is up over 17% since the same time last year. With a relatively small supply of sales available for condo buyers, individuals have to max out on their mortgages to attain the condominium they want.
Detached Prices and Market
The detached home market is on the opposite side of the spectrum for June. With 1320 units sold, there is a decrease of over 15% since June of 2016. Often when this happens, the prices reflect the drop. However, the benchmark price for detached homes is June 2017 rose 1.4% and hit a record high of $1,587,900.
Costing More Than Rest Of Canada
Purchasing a home in the Greater Vancouver area is by far the most expensive in the Canadian housing market. There is still a long way to go before a balanced market in the area happens. If you are thinking about selling your condominium, now is a great time to maximize your earning potential. With multiple offers happening on a regular basis, you are sure to get close to your asking price. With so many buyers on the market looking to live the condo lifestyle, take advantage of selling yours now.
Trend Likely To Continue Into 2018
Robert Hogue, a senior economist at RBC, said: “We still expect poor affordability and rising interest rates to weigh on the market in 2018, keeping resales on a downward track and containing the pace of price increases to low single-digits.” So it looks like the housing market in the Greater Vancouver Area still has a way to go before supply and demand come together to create a balanced market for both buyers and sellers alike.