Vancouver Housing Demand Resurgent
Our region’s housing market has charted a new course in the second half of 2019 and logged its 4th consecutive month of sales gains in October, with last month’s sales up 42% compared to October 2018. These changes reflect continued population growth, economic expansion, an absence of new policy interventions, and some pent-up demand that has accumulated over the past couple of years.
Notably, the rebound has been realized across all home types, with sales of townhomes in October up 40%, condos up 41%, and detached up 43% versus last year. As a result, townhome and condo sales are now 22% above their respective long-run historical averages, and while detached sales are still 7% below the norm, this represents a marked shift since March 2019 when detached sales were more than 50% below their long-run average.
While these data points tell us how our current market is faring in the context of past years, they speak less directly to its recently-changing trajectory. For this we look to recent month-over-month changes. October’s sales were up 21% versus September, notable as we typically see an average 7% increase between September and October markets. This builds on what we saw in September, when sales increased despite the typical August-to-September decline. Clearly, the demand side of our market is playing catch-up, with the 4,367 sales registered last month representing the fourth-highest number in the past ten Octobers.
One consequence of this recently-elevated sales activity has been a contraction in inventory, with total listings down 12% year-over-year and 11% month-over-month. It’s not surprising, then, that benchmark prices have begun to inch upwards after months of stagnation: overall, prices were up 0.1% in October versus September, with detached prices up 0.3% and condo prices up 0.1% (townhome prices inched down by 0.1%).
The myriad of changes our market is undergoing across home types, neighbourhoods, and price points has created conditions that favour sellers of homes under $1M regionally, while conditions are balanced in the $1-1.5M range, and buyers continue to have the upperhand when it comes to the most expensive segments of the market. Overall, however, it has become unambiguously clear that our market has exited the slump that characterized much of the past two years. Looking ahead, expect even more competition for available homes which, when combined with continued favourable economic conditions, is sure to create tailwinds for prices.
