A steady increase in the number of homes that are entering the market is creating some housing inventory for buyers to select from. This is some of the largest selection that buyers have had to select from since 2021!
Sales of residential products for November totaled 1,702 as reported by the REBGV (Real Estate Board of Greater Vancouver). This is a 4.7% increase from November 2022 and was 33% below the 10-year average.
“We’ve been watching the number of active listings in our market increase over the past few months, which is giving buyers more to choose from than they’ve been used to seeing over the past few years,” Andrew Lis, REBGV’s director of economics and data analytics said. “When paired with the seasonal slowdown in sales we typically see this time of year, this increase in supply is creating balanced conditions across Metro Vancouver’s housing market.”
November 2023 saw a total of 3,369 newly listed homes across all types (detached, attached and apartments). This is a 9.8% increase from November last year and 2.8% less than the 10-year average.
Currently the total number of homes that are available is 10,931. This is a 13.5% increase from November 2022 and is 3.7% above the 10-year average.
The sale-to-active ratio for November of this year is 16.3% and breaks down by property type as follows:
Detached: 12.7%
Attached: 19.8%
Apartment: 18.2%
Historical data suggests that sustained ratios below 12% exert downward pressure on home prices, while those exceeding 20% over several months typically lead to upward price trends.
“Balanced market conditions typically come with flatter price trends, and that’s what we’ve seen in the market since the summer months. These trends follow a period where prices rose over seven per cent earlier in the year,” Lis said. “You probably won’t find Cyber Monday discounts, but prices have edged lower by a few per cent since the summer. And with most economists expecting mortgage rates to fall modestly in 2024, market conditions for buyers are arguably the most favorable we’ve seen in some time in our market.”
The current composite benchmark price for all residential properties in Metro Vancouver stands at $1,185,100 according to the MLS® Home Price Index. This reflects a 4.9% rise since November 2022 but shows a 1% drop compared to October 2023.
In the detached homes category, there were 532 sales in November 2023, marking a 7% increase from November 2022, with a benchmark price of $1,982,600. This signifies a 6.8% increase from November 2022 but a 0.9% decrease compared to October 2023.
Attached homes reached 316 sales in November 2023, reflecting a 12.5% increase from November 2022, with a benchmark price of $1,092,600. This shows a 6.9% increase from November 2022 but a 0.7% decrease compared to October 2023.
As for apartment home, there were sales reached 850 in November 2023, a 0.4% uptick from November 2022, with a benchmark price of $762,700. This represents a 6.2% increase from November 2022 but a 1% decrease compared to October 2023.
The Takeaway:We typically see slower transactions in the winter months (and the summer ones for that matter). The mortgage rates have raised form 2.2% in July 2021 to 6.10% (5-year fixed), which has had an impact on the number of transactions in the real estate market as both sellers and buyers are in a holding pattern to see where the rates end up. This higher rate has also pushed many buyers out of the market and thus there are less transactions occurring; which has brought on more inventory for the buyers still in the hunt to choose from. IE. a balanced market.
The BoC (Bank of Canada) is to meet for their final time in 2023 and most are expecting the rate to remain the same. This will likely keep the real estate market modest and will continue to hold many buyers out of the it… That being said if you are able to afford the current interest rates, this will work to your advantage as there are sellers still wanting to sell and thus may be more interested in negotiating.
Many financial experts are under the belief that the rates will start to drop sometime mid-2024. When this happens we will likely see a flurry of activity in the residential market and will again push prices back up as more competition will be seen.
If you would like to have to some real world advice about how to navigate this shifting market feel free to reach out to me at 604-522-4777 or e-mail directly at: haze@hazerealty.com or join us at our Facebook Page (www.facebook.com/HazeRealty) and we see what the best move can be.
(Source: https://www.rebgv.org/market-watch/monthly-market-report/november-2023.html)