June Market Updates: Metro Vancouver’s Housing Market Continues to Surge

As we dive into the summer season, Metro Vancouver’s housing market maintains its upward trajectory with home prices on the rise. The Real Estate Board of Greater Vancouver (REBGV) reports that the benchmark price for all types of homes in the region saw an increase in June. This growth is primarily fueled by strong home buyer demand, but the limited inventory of available homes for sale is creating a challenging market environment.

In June 2023, residential home sales in Metro Vancouver reached a total of 2,988, marking a significant 21.1 per cent increase compared to June 2022 when 2,467 sales were recorded. However, it’s worth noting that despite this surge, the number of sales still falls 8.6 per cent below the 10-year seasonal average of 3,269.

Andrew Lis, the director of economics and data analytics at REBGV, emphasizes that the market continues to perform remarkably well across all segments. Notably, the apartment segment showed the most relative strength in June. The benchmark price of apartment homes is nearing the peak reached in 2022, and apartment sales have now surpassed the region’s ten-year seasonal average. This sets the apartment segment apart from the attached and detached segments, where sales remained below the ten-year seasonal averages.

In June 2023, 5,348 detached, attached, and apartment properties were newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver. This represents a slight 1.3 per cent increase compared to the 5,278 homes listed in June 2022. Nevertheless, it remains 3.1 per cent below the 10-year seasonal average of 5,518.

As of June 2023, the total number of homes listed for sale on the MLS® system in Metro Vancouver is 9,990, indicating a 7.9 per cent decrease compared to the previous year (June 2022) when 10,842 homes were listed. This current figure is also 17.4 per cent below the 10-year seasonal average of 12,091.

 

To better understand the state of the market, industry professionals often look at the sales-to-active listings ratio. For June 2023, this ratio stands at 31.4 per cent across all detached, attached, and apartment property types. Broken down by property type, the ratio is 20.9 per cent for detached homes, 38.5 per cent for townhomes, and 39.4 per cent for apartments.

Experts suggest that when the ratio falls below 12 per cent for a sustained period, downward pressure on home prices can be expected. Conversely, when the ratio surpasses 20 per cent over several months, upward pressure on home prices is common. As of June 2023, the ratio is still quite healthy, indicating a market where demand continues to outstrip supply.

Andrew Lis points out a significant factor contributing to the continuous price increases is the shortage of resale inventory compared to the number of buyers in Metro Vancouver. He highlights that the province’s government should consider adjusting the current threshold for the Property Transfer Tax exemption, which currently stands at $525,000 for first-time home buyers. This adjustment would better align with the reality of entry-level home prices in the region, providing more opportunities for first-time buyers to enter the market.

As of June 2023, the MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is $1,203,000. This figure represents a slight 2.4 per cent decrease compared to June 2022 but shows a promising 1.3 per cent increase compared to the previous month, May 2023.

Breaking down the sales data by property type, we find that sales of detached homes reached 848 in June 2023, experiencing a substantial 28.3 per cent increase from the 661 detached sales recorded in June 2022. The benchmark price for a detached home in the region is currently $1,991,300, indicating a 3.2 per cent decrease from June 2022 but a 1.9 per cent increase from May 2023.

Similarly, sales of apartment homes in June 2023 reached 1,573, showing an impressive 18.6 per cent increase compared to the 1,326 sales in June 2022. The benchmark price of an apartment home is $767,000, which reflects a slight 0.5 per cent increase from June 2022 and a promising 0.8 per cent increase from May 2023.

Lastly, attached home sales in June 2023 totaled 547, marking a notable 17.6 per cent increase compared to the 465 sales in June 2022. The benchmark price of an attached home is $1,098,900, representing a one per cent decrease from June 2022 but a 1.5 per cent increase from May 2023.

In conclusion, the housing market in Metro Vancouver remains in high demand, with home prices continuing to rise, especially in the apartment segment. The limited inventory of homes for sale is putting upward pressure on prices across all property types. Despite challenges, the market is proving resilient, and experts believe that policy adjustments could offer more opportunities for first-time home buyers to enter the market. As we move forward into the summer, the real estate landscape in Metro Vancouver remains dynamic and competitive, with careful consideration needed for both buyers and sellers.