Vancouver’s housing market has taken another hit with residential home sales declining 36.6 per cent year-to-year, according to the The Real Estate Board of Greater Vancouver (REBGV).
Their numbers show that August had only 1,929 sales compared to 3,043 in the same month the year before.
“It’s clearly a wait-and-see market,” Chris Catliff, president and CEO at BlueShore Financial, tells Yahoo Canada Finance. “Single-family homes have been going down in price for quite some time.”
According to the REBGV, there were only 567 detached property sales in August of this year compared to 901 in August 2017.
Catliff says the market has been affected by the foreign-buyers tax, which arrived in August 2016. Increases in other taxes, including the speculation tax, which penalizes those that own a home without renting it, have had an impact as well.
“We see in the very high-end of the market, very, very low sales, and people waiting to see if prices have adjusted,” Catliff says.
And there’s also the divide between what sellers want for their home and how much buyers are willing to pay.
“Vendors want their price that they could have got yesterday, and purchasers are being very canny and low-balling, if at all,” he adds.
The REBGV says residential home sales in August were also 25.2 per cent below the 10-year August sales average and that it has seen homebuyers being less active in recent months.
“Buyers today have more listings to choose from and face less competition than we’ve seen in our market in recent years,” REBGV president Phil Moore said in a media release.
Condos and townhouses
Catliff says the challenges around single-family sales are starting to seep into Vancouver’s townhouse and condo market.
With many condos under construction and pre-sold before the recent dramatic changes, Catliff also adds that it may be some time before we see what this all really means for condos.
However, the REBGV says that sales of apartment properties were down 36.5 per cent from August 2017 and August 2018 and that attached properties saw a similar 36.3 per cent decrease when comparing the same months.
Catliff says what sparked the condo frenzy in 2016 and 2017 was parents selling their empty nest for several million to help their kids with a large down payment.
While parents are still helping their kids, he adds, there’s less liquid money available now than if there were to sell their house a few years ago.
“What we’re seeing is that there’s been huge price acceleration for large parts of the city of Vancouver in condos year over year,” Catliff says. “It’s kind of catching up to where single-family homes have gone in a way — mostly also because of scarcity of product available.”
With the recent changes in the market, he adds it’s a great opportunity for first timers to jump in.
“As the prices moderate down to kind of flat in the condo market, will all the supply in 18 months, two years, will that inventory create a price deceleration — and a lot of people think it will,” Catliff said.
“If somebody is out there thinking about buying a place, I would encourage them to use this upcoming opportunity to probably get into the market.”