Inventory at 10-year lows in most regions, pushing prices ever higher
The number of homes sold on the Multiple Listing Service® in BC in September rose nearly 10% year over year, and 5% from August, according to a report by the British Columbia Real Estate Association (BCREA) published October 12.
Because there was also an increase in sale prices, that lead September’s total sales dollar volume to rise by a
whopping 30.2% compared with the same month last year.
The average resale price of a home in the province last month was 18.5% higher than one year previously, at $693,774, which is up 2.3% in a single month since August’s average of $678,168.
The annual jump in homes exchanging hands across the province is largely driven by increased activity in the Lower Mainland, which has seen a recovery from the effects of the Metro Vancouver foreign buyer tax introduction last August. Of the larger markets, Greater Vancouver and the Fraser Valley posted the largest annual sales gains, both up around 25%, whereas Victoria saw the province’s biggest year-over-year slide in unit transactions, down 16.6%.
Some of the Interior and smaller markets also saw annual sales declines, although Kamloops and Chilliwack both had a strong showing, up 8.2% and 7.7% respectively.
The annual price rises seen by the different boards also varied, but did not necessarily mirror sales patterns. Nine out of the 11 BC boards reported year-over-year average price increases. Of the larger markets, where price changes are less volatile, the Fraser Valley and Greater Vancouver saw the biggest price gains, up 18.2% and 17.7% respectively. But Victoria, where sales dropped, posted an average price increase of 12.5%. Only the very small markets of BC Northern and Norther Lights saw minor annual average sale price declines.
Eight of the 11 boards posted year-over-year declines in the number of active listings in September, although Greater Vancouver was not one of them.
“Total active listings on the market continue to trend at 10-year lows in most BC regions, limiting unit sales and pushing home prices higher,” said Cameron Muir, BCREA chief economist.
“While the economic fundamentals support elevated housing demand, rising home prices are eroding affordability, particularly for first-time buyers.”
The BCREA report was issued on the same day as Royal LePage’s 2017 Q3 House Price Survey, which looks at quarterly price activity in Canada’s major urban markets. The report said that during the third quarter, the aggregate home price in Greater Vancouver rose year over year by a “modest, but healthy” 2.5% to $1,229,133.
However, when broken out by housing type, the brokerage found that the median price of a Greater Vancouver condo increased 17.6% year-over-year to $622,392. The median price of a bungalow had a much more reasonable increase, up 3.5% year-over-year to $1,422,458, but the median price of a standard two-storey home fell 1.1% to $1,532,849 in the same period.