November 2016 Real Estate Market Update

The Real Estate Board of Greater Vancouver (REBGV) released a report on Nov. 2, 2016:
Home sale and listing activity dip below historical averages in October.In the report, REBGV president Dan Morrison said a lot of buyers and sellers are waiting to see what is going to happen in the market and single family houses are being affected the most. The MLS Home Price Index composite benchmark price for all property types in Greater Vancouver is $919,300 which is a 24.8% increase from same month last year and 0.8% decrease from last month this year.

According to Bob Rennie that since April this year, the single family house market started showing signs of cracking…every listing is $500,000 more than the home sold next door and that’s not sustainable.

Agents in our office felt the market is stabilizing. There are still serious buyers who want to buy for the long run and did not mind the short term ups and downs of the market. Sellers are not ready to slash the price. The price will be gradually chipped away based on supply and demand.

The overall average sales to active ratio in Greater Vancouver is at 24.4% right now. Analysts say upward pressure on home prices occur when the sales ratio is over 20% and downward pressure on prices occurs when the sales ratio dips below 12% over several months.

See graphs below for the Sales to Active ratio for different types of Vancouver West homes.

Last month, we still had a multiple offer situation with 7 offers on a house in New Westminster and the house was sold for more than the asking price.
We also had a buyer who had to buy before the new mortgage rule came into effect.
A foreign buyer backed out of a deal to purchase a house in Richmond that’s over $2 million and a resident ended up purchasing the home for 10% less than the foreign buyer’s contracted purchase price. But the house was still sold over asking….
1 bedroom homes in Avalon Park 1 of River District is sold out in one day last week…
114 home in River Park Place Richmond sold out in one month last month with 7.5% non-resident buyers after the new Foreign Tax came into effect.

This is definitely an interesting time in the real estate market.

Check out the report “Emerging Trends in Canadian Real Estate 2017” – produced by the consulting firm PricewaterhouseCoppers.