As the summer begins, Metro Vancouver’s housing market maintains its upward trajectory, with home prices continuing to rise. The combination of robust buyer demand and limited inventory has contributed to this ongoing trend. Let’s delve into the latest updates from the Real Estate Board of Greater Vancouver (REBGV) and explore how the different segments of the market are faring.
Vancouver’s Housing Market – Apartments Lead the Way
Among the various housing segments, apartments have demonstrated notable strength in June. Sales of apartment homes surpassed the region’s ten-year seasonal average, while the benchmark price for these properties is inching closer to the peak recorded in 2022. Meanwhile, the sales of detached and attached homes remained below their respective seasonal averages.
Limited Inventory and Elevated Demand
Metro Vancouver continues to grapple with a scarcity of resale inventory relative to the pool of eager buyers. This fundamental imbalance between supply and demand has been the primary driver of the consistent month-over-month price increases across all market segments. Despite higher borrowing costs, home buyers face a challenging market characterized by a lack of options.
The Call for Policy Adjustments
With the benchmark price for apartments now reaching $767,000, there is a renewed call from REBGV to the provincial government to adjust the threshold for the Property Transfer Tax exemption for first-time home buyers. Currently set at $525,000, this threshold fails to reflect the reality of entry-level home prices in the region. An adjustment in this policy could enhance affordability for aspiring homeowners.
In June 2023, residential home sales in Metro Vancouver recorded a substantial increase of 21.1% compared to the previous year. However, this figure fell below the 10-year seasonal average by 8.6%. A total of 2,988 homes were sold during the month.
New listings in June 2023 increased slightly by 1.3% compared to the previous year, with 5,348 properties (including detached, attached, and apartments) listed for sale. However, this number remained below the 10-year seasonal average by 3.1%.
Currently, the MLS® system in Metro Vancouver lists 9,990 homes for sale, representing a 7.9% decrease from June 2022. However, it is important to note that this figure remains significantly lower than the 10-year seasonal average by 17.4%.
The sales-to-active listings ratio for June 2023 stood at 31.4% across all property types, indicating a seller’s market. By property type, detached homes had a ratio of 20.9%, townhomes had 38.5%, and apartments had 39.4%.
Metro Vancouver’s housing market is experiencing a continued surge in home prices, primarily driven by limited supply and high buyer demand. The apartment segment has shown exceptional strength, surpassing sales expectations and nearing previous price peaks. With the market dynamics favoring sellers, aspiring homeowners face ongoing challenges in finding affordable options. Policy adjustments to enhance first-time buyer affordability have been proposed to address this issue.