Real (Estate) Talk with Ryan Berlin - July 2021

The rennie review is produced each month by rennie intelligence, which includes the latest real estate data for Vancouver Region's housing market.continued swoon or comparative boom?At the time of this report’s writing, things are looking up for denizens of the Vancouver Region: summer and its heat are upon us (ok, maybe it’s been a bit too much heat), 80% of eligible British Columbians have received at least one dose of the Covid-19 vaccine (and 41% are fully vaccinated), and the province has transitioned to Step 3 of its Covid-19 re-opening plan.

Add it all up, and it’s very likely that a sizeable proportion of our population will be focussed more on seeing friends and family, and vacationing, than buying and selling real estate during the summer months.

In considering this change in focus from homes to humans that will likely characterize the next couple of months, it’s worth asking if the transition already began in June. Indeed, the province moved from Step 1 to Step 2, allowing for more interpersonal contact, frequenting of food and drink establishments, and mobility; at the same time, MLS sales in the Vancouver Region fell for the 3rd straight month, from an all-time peak of 8,898 back in March to “only” 5,963 in June. Compared to the previous month, June’s sales were down 16%, when a typical May-to-June sales count change is a decline of 2%.

So while one and two data points do not a trend make, we now have three--as in three months of declining sales--so it seems safe to say we are truly coming off of the historic highs achieved earlier in the year. And these highs are not likely to be re-attained in the foreseeable future. Having said that, it’s worth noting that June’s just-shy-of-6,000 sales were the most in any month in the pre-Covid era, going all the way back to June 2017. It seems clear, then, that the demand side of the market has some room to run still.

Notably, inventory fell on a month-over-month basis in June for the first time in four months, at a time of year when inventory is typically expanding (on average by 2% between May and June over the past decade).

With sales and inventory waning, this same-direction recalibration of both demand and supply has had little effect on overall market conditions, which continue to favour sellers, albeit to a lesser extent than a few months ago. In turn this has meant that prices have more or less remained even as sales have sagged, with the region’s average sold price of $1.12 million in June down only 2% from March’s $1.14 million.

When our province moves to Step 4 of its re-opening plan in September, our respite from an overly-active housing market may come to an end. Until then, however, expect activity to be muted through July and August.  Our rennie intelligence team comprises our in-house demographer, senior economist, and market analysts. Together, they empower individuals, organizations, and institutions with data-driven market insight and analysis. Experts in urban land economics, community planning, shifting demographics, and real estate trends, their strategic research supports a comprehensive advisory service offering and forms the basis of frequent reports and public presentations. Their thoughtful and objective approach truly embodies the core values of rennie.