REBGV Market Update For June 2022 – Buyer’s Market Emerging As Home Sales Decline
The June 2022 market report released by the Real Estate Board of Greater Vancouver (REBGV) showed that rising interest rates and declining prices are now weighing heavily on buyer’s minds.
Daniel John, Chair of the REBGV commented, “Home buyers have more selection to chose from and more time to make decisions than they did over the past year. Rising interest rates and inflationary concerns are making buyers more cautious in today’s housing market, which is allowing listings to accumulate.”
In June 2022, there were 2,444 residential property sales. This represented a 35% decrease from the 3,762 sales in June 2021 and a 16.2% decrease from the 2,918 homes sold in May 2022.
The number of detached properties sold was 653, 48.3% less than the 1,262 sales recorded in June 2021. The benchmark price was $2,058,6000 – 13.4% increase when compared to June 2021.
The number of apartments sold was 1,326, 25.3% less than the1,774 sales recorded in June 2021. The benchmark price was $766,300 – 12.7% increase when compared to June 2021.
The number of attached properties sold was 465, 36% less than the 726 sales recorded in June 2021. The benchmark price was $ 1,115,600 – 17.8 increase when compared to June 2021.
Median prices have been dropping consistently and considerably since the Bank of Canada started increasing interest rates earlier this year.
There were 5,256 new listings of detached, attached and apartment properties for June 2022 added to the Multiple Listing System (MLS). This represented a 10.1% decrease compared to the 5,841 homes listed in June 2021, and a 17.6% decrease compared to May 2022 when 6,377 homes were listed.
The total number of homes listed for sale in June on the MLS was 10,425, a 3.8% decrease compared to June 2021 (10,839) and a 4.1% increase compared to May 2022 (6,377).
This is more evidence that the real estate market for homes in the Greater Vancouver area has swung another notch down from its pandemic boom highs, with prices softening and properties sitting unsold for a longer period of time.
This is a good indication of the supply and demand forces in the market. Downward pressure on home prices can occur when the ratio is below 12% for a sustained period, and there is upward pressure when the ratio is above 20% for a number of months.
For all property types, the ratio in June was 23.4%. When broken down by property types, the ratio was:
- 14.3% for detached homes
- 31.5 % for townhomes
- 30.2% for condos
The MLS Home Price index composite benchmark price for all residential properties in Metro Vancouver was $1,235,900. This was down 2% from May and a 2.2% decrease over the past 3 months.
The Bank of Canada is expected to increase the interest rates in the coming months and according to some analysts, this may trigger a further decline in home sales and prices.
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