a new path? sales rise and prices stabilize.
The latest data hint that a new market narrative may be warranted, as the Vancouver region passes 4,000 sales in a month for the first time in a year. Is this the beginning of a new trend, or just a one-time blip?
Data is increasingly influencing our lives, from optimizing our routes into the office and back home again, to informing us of emerging trends in our economy and real estate markets. That being said, the way data is currently being disseminated and consumed through social media and headlines seemingly alludes to there being some form of consensus around the facts. Such a consensus may not, however, always paint a true picture of what is happening, and it may not always help us understand the why behind what is happening. This is what compels us to dig a little deeper than others into the data.
When the latest MLS data were released last week, we saw numerous indications that the region’s housing market had a less-than-tragic month in May. It may even have begun to move along an altered trajectory to what has prevailed over the past year-and-a-half. Here are some highlights:
Sales in May were up by 30% over April. This compares to a past-decade average increase of 5% between these two months. The region broke the 4,000-sales mark for the first time since May 2018, with the sales gap--the relative decline in year-over-year sales--shrinking to only 3%. This was the smallest gap in any month since this market adjustment began in April 2018 (at that time, sales were down 26% year-over-year and peaked at a 45% gap in December 2018).
Trends in pricing have also changed perceptibly. Benchmark condo prices have now increased for four consecutive months and townhome prices for three. Detached prices have remained relatively constant, moving by less than one percent over the past three months. While one month does not a trend make, these multiple-month price movements hint at an altered trajectory from the latter half of 2018.
Finally, with the sales-to-listings ratio at 18%, the overall market is firmly balanced. That said, both condo and townhome segments moved into seller’s market territory in May, while the detached segment moved into balance for the first time since May 2018.
Few of these data points have, to this point, been reported on. Instead, the consensus narrative is that monthly sales continue to trend lower as the market continues to soften. Our read of the data points to a market trajectory in 2019 that differs demonstrably from that of 2018. While we do not know definitively where things will go through the rest of the year, we will continue analyzing the data over the coming months in an effort to better understand how and why the market is evolving.
The rennie review is produced each month by rennie intelligence, which includes the latest real estate data for Vancouver and the Lower Mainland's housing market. View the latest edition of the rennie review.
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.