The weather is getting warmer, but the same cannot be said for the Greater Vancouver real estate market, as buyer hesitancy continues to permeate the market, according to June statistics published by Greater Vancouver Realtors (GVR) on Wednesday.
In June, the Greater Vancouver region recorded a grand total of 2,395 home sales, which represents a significant decrease from the 2,968 recorded in June 2023, the 10-year June average of 3,166, as well as the 2,707 recorded in May 2024
Meanwhile, a total of 5,723 new listings came online, which represents a significant increase from the 5,348 added in June 2023, the 10-year June average of 5,554, although it is a drop-off from the 6,347 added in May 2024.
With this new batch, the total amount of active listings in Greater Vancouver is now up to 13,605, which is also a significant increase from the 9,466 at this time last year and the 10-year June average of 11,790.
"The June data continued a trend we've been watching where buyers appear hesitant to transact in volumes we consider typical for this time of year, while sellers remain keen to bring their properties to market," said GVR Director of Economics and Data Analytics Andrew Lis. "This dynamic is bringing inventory levels up to a healthy range not seen since before the pandemic. This trend is providing buyers more selection to choose from and driving all market segments toward balanced conditions."
Buyers or Sellers
With the above statistics, we can identify the sales-to-new-listings ratio and sales-to-active-listings ratio, which are two quantitative indicators that give us a sense of whether the market is currently favouring buyers or sellers.
For the sales-to-new-listings ratio, a ratio of 40% or lower is considered a buyers' market, a ratio of 55% or higher is considered a sellers' market, and anything in between is considered a balanced market.
With 2,395 home sales and 5,723 new listings recorded in June, the sales-to-new-listings ratio is now at 41.8%, after being at 42.5% at the end of May, which indicates some movement towards favouring buyers.
For the sales-to-active-listings ratio, a ratio of 12% or lower is viewed as favouring buyers, a ratio of 20% or higher is viewed as favouring sellers, and anything in between is viewed as a balanced market.
With 2,395 home sales and 13,605 total active listings in June, the sales-to-active-listings ratio is now 17.6%, after coming in at 20.8% in May, which again indicates movement towards a buyers' market, although we're not quite there at the moment.
There is more nuance as you zoom in on different property types, however, with both the attached homes market and condominium market in sellers' market territory, while the market for single-family homes is much closer to a buyers' market.
The sales-to-active-listings ratios for June 2024.(Greater Vancouver Realtors)
Analysis and Outlook
Following June, the composite residential benchmark price for Greater Vancouver is now at $1,207,100, which represents a minor 0.4% decrease from May 2024 and a 0.5% increase from June 2023.
By property type, the benchmark price is now $2,061,000 for single-detached homes, $1,138,100 for attached homes, and $773,400 for condos. All three represent decreases of between 0.1% and 0.6% from May 2024, but increases of between 1% and 3.7% when compared to June 2023.
As for when the market will start heating up, that will likely be dependent on when the Bank of Canada cuts its policy interest rate once again.
"With an interest rate announcement from the Bank of Canada in July, there is a possibility of another cut to the policy rate this summer," added Lis. "This is yet another factor tilting the market in favour of buyers, even if the boost to affordability is modest. But June's lower-than-normal transaction volumes suggest many buyers remain hesitant, which has allowed inventory to accumulate and has kept a lid on upward price pressure across market segments."
The Bank of Canada's next interest rate announcement will be made on Wednesday, July 24.
