Vancouver brokers faced a slowing market in July, a deficit stagnant home values were unable to compensate for, according to the latest sales numbers.
While the benchmark price for a typical detached house fell a modest 0.1 per cent to reach $630,251, sales were down 21.2 per cent in July compared to June, according to the Real Estate Board of Greater Vancouver (REBGV). That was enough for analysts to point to the likelihood of a significant slowdown in what has been one of Canada’s most buoyant markets this summer.
That hasn’t been the case for brokers now struggling to grow originations. Adding to the challenge is increasingly fierce competition from the banks and credit unions. Still the volume declines are just month-over-month. Overall, the benchmark price for all residential properties in Vancouver is up 9.2 per cent compared to 12 months ago. The benchmark for detached properties is up 13.3 per cent year-over-year, and attached units are up 6.9 per cent compared to last year, reaching $524,909.
Those values – and the potential gain in commissions – haven’t been enough to make up for the dearth of new purchases, with some brokers also challenged to find the refi business others are now turning to in order to maintain revenue streams.
What could be behind the monthly drop in sales and activity is that more Vancouver owners are looking to sell with the favourable conditions, and thus creating more choices for buyers and less demand.
“We’re seeing less multiple offer situations in the market today compared to the last few months, but our members tell us that homes priced competitively continue to sell at a relatively swift pace,” said Rosario Setticasi, REBGV president.
The average selling time is 41 days in July, unchanged from June.
Sales are also still considerably higher than last year – up 14% in July compared to 12 months earlier.
“The number of homes listed for sale in the region has increased each month since the start of the year, which is giving buyers more selection to choose from and more time to make decisions,” said Setticasi.
Still, analysts are anxiously watching Vancouver considering home prices are up 21 per cent in the past year alone. Some recent reports, such as Capital Economics, say it’s not a question of if, but when the Vancouver market and the rest of Canada’s real estate begins a decline after the recent surge, especially if interest rates rise.