Fresh numbers from the Real Estate Board of Greater Vancouver showed that sales volume now stood considerably below the 10-year average – but those who are anticipating a subsequent increase in the availability of affordable homes in the market are bound to be disappointed.
The REBGV data showed that the most significant price declines over the past half year were concentrated to the most expensive neighbourhoods, most notably the West Side of Vancouver and West Vancouver (both with decreases of around 4%).
This is because the lower end of the market is disproportionately affected by the current regulatory regime and the ever-increasing interest rates, according to REBGV president Phil Moore.
As an example, Moore stated that a couple with an annual income of $120,000 is limited by the stress test to homes valued at up to $750,000 only. This is roughly the price range of Vancouver’s already highly desired apartments and townhouses.
“First time buyers are so frustrated,” Moore told CBC News, adding that the scarcity of affordable homes in the immigrant-rich region is exacerbating the problem.
“The selection of homes for sale in Metro Vancouver has risen to the highest levels we’ve seen in the last two years, yet supply is still below our long-term historical averages.”
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B.C. Real Estate Association chief economist Cameron Muir noted that cooling is expected more in the upper end, considering the impact of the new school tax and the added property transfer tax in successful transactions involving multi-million-dollar homes.
“Only 3% cent of homes sell for over $3 million,” Muir stated as a reason for the muted effect of the new tax on the mid- and lower-end housing markets.
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