Sales activity across Metro Vancouver has slowed over the last few months.
According to data from The Real Estate Board of Greater Vancouver (REBGV), home sales in Metro Vancouver peaked at 1,887 in July 2022 -- that’s more than a 40% decrease year-over-year, and a 22.85% dip compared to the month prior.
Along with sales activity, prices have also fallen. From July 2021 to July 2022, average prices have decreased about 10% across all property types.
After two-and-a-half years of unprecedented growth, this housing market cool-down is a result of a few factors: record-high inflation, rising interest rates, and general uncertainty in the stock market.
However, despite this uncertainty, Kevin O’Toole, Managing Broker at Sotheby’s International Realty Canada, remains positive about the future.
O’Toole has been working in the industry for twenty years, and has lived through his fair share of ups and downs. According to him, this current cool-down has been relatively mild compared to past corrections he’s experienced.
For instance, in 2008, prices dropped by about 20% during the height of the Global Financial Crisis. And even back then, Vancouver’s housing market was quick to bounce back once homebuyers realized that Vancouver and Canada at large weren’t dealing with the same issues as the United States.
But according to O’Toole, it’s a bit too early to tell where the market is headed. We’ll have a better sense of where things are at come September, when the Bank of Canada announces its next rate hike.
“Right now, we’re thinking the next rate hike will be around a half point to three-quarters of a point,” shares O’Toole, “but some people are predicting another full point increase, and if that happens, that may cause a [further] slowdown in the market.”
But O’Toole points out that the biggest market cool-down may already be behind us, since current sales activity is below the 10-year average.
The silver lining of all this uncertainty? Because condos have seen a much smaller dip than detached homes, now may be a good time for suite owners to upsize.
“Over the last two years, house prices in Greater Vancouver escalated much faster than condos and townhomes,” says O’Toole. “Now, detached home prices are coming down, while condos and townhomes are holding their value.”
“People who have built a lot of equity in their [condos] could be in a position to purchase a bigger home, or upsize to something that may have been unobtainable six months ago.”
But this sweet spot in the market may not last for long. According to O’Toole, activity has already started to pick up over the last couple of weeks as summer comes to a close, kids go back to school, and people are increasingly making plans for the future.
Only time will tell how the next few months pan out, and where the market will be at by the end of the year.
This article was produced in partnership with STOREYS Custom Studio.