No need to necessarily be an economist to have forecasted that median home prices in Canada were going to go down as a result of the BoC’s inevitable interest rate hikes. Everyone knew this was coming, and of course that includes those who’d stand to be the least thrilled about it – home owners considering selling their home anytime in the near future. That said, the values of said homes in comparison to what most of these owners would have paid for them should be taking a good bit of the sting off anyways.
But going up and going down is what markets do, albeit not with any frequency when it comes to real estate in British Columbia and Canada as a whole. Which is a good thing when you consider how much the real estate industry contributes to Canada’s GDP, and whether or not that’s a good thing in the big picture (it’s not, but we won’t digress). Having homes retain their value increases to a significant extent has been what the informed homeowner will have been hoping for when understanding that the market couldn’t – and shouldn’t – stay that heated forever.
Real estate agents worth their salt will have their thumb on the pulse of all of this, and it is true that even in the ‘best’ of times real estate is a competitive business given how lucrative it can be for people who have the smarts and are willing to put in the work required to be successful. Those who are new to the business may be surprised to find just how competitive it really is, and for these individuals our online real estate lead generation system here at Real Estate Leads is highly recommended.
The typical home price came in at $1,261,100, which worked out to a 0.3% decrease compared to April 2022. This goes along with an annual basis price that represents a 14.7% increase over May of last year. This applies to Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.
But back to topic as always, let’s look at the numbers and other noteworthy considerations about median home values have dipped in the Greater Vancouver area and Fraser Valley these days.
Marginal Drop for both Regional Districts
New monthly reports from both the Greater Vancouver and Fraser Valley REBs came a day after the Bank of Canada hiked its interest-setting rate by 0.5% percent on Wednesday June 1st. This was the third increase in 2022, and it brought the central bank’s key rate to 1.5%. At nearly the same time the Greater Vancouver REB reported the next day (June 2nd) that the composite benchmark price for all residential properties went down month-over-month in May.
What this means most pertinently is that the rising interest rates are making many home buyers put a lot more though into making decisions in today’s housing market. We are also seeing upward pressure on home prices beginning to ease in the housing market over the last two months, and even the most ambitious realtor is going to tell you this is absolutely something that had to happen in the big picture, despite what it might mean for folks who have only recently entered the market.
Focus on Coming Supply
Greater Vancouver home sales totalled 2,918 in May 2022, which represents a 31.6% decrease from the 4,268 sales that occurred in May 2021, and a 9.7% drop from the 3,232 homes purchased by homebuyers in April of this year. Add to that the benchmark price of a detached home in the region in May 2022 was $2,093,600, a decline of 0.4% from April while rising 15% from May 2021.
Apartment homes saw a smaller increase, with a benchmark price for this region being $779,700, up 0.4% from April 2022 and 15% compared to May of last year. Attached homes had a typical price in May 2022 of $1,141,200, working out to a 0.6% drop from April 2022 but rising 21.5% up from May 2021.
Statistics for the Fraser Valley REB – which covers Abbotsford, Langley, Mission, North Delta, Surrey, and White Rock – were quite similar although not quite as pronounced. It was quick to note falling sales, despite realtors in the region selling 1,360 properties for May 2022. That number works out to a 16.9% decline from April sales of 1,637, and being down 53.9% compared to May of last year.
Beginning in March, what has been seen is sales coming down with an accompanying increase in inventory. What this has done is provide a much-needed balance and cooling of the heated market and some people believe that the role of big pandemic-era drivers like working from home and record low interest rates may have come to an end now. Let’s hope so.
The price of a typical detached home in the Fraser Valley was an average of $1,712,500 for May, a decline of 2.4% compared to April 2022 while up 26.2% from May of last year. Townhouses in the region came in at $918,900 for townhouses, and that was a decrease of 1.4% compared to April 2022 and a 31.3% increase from May 2021. Apartments came in at $581,400, for the Fraser Valley, which is down 1.1% compared to April 2022 and up 30% in comparison to May of last year.
__
Sign up for Real Estate Leads here and receive a set quota of qualified, online-generated buyer and / or seller leads that are delivered to you at the same time each month, but more importantly delivered to only one realtor – you. This means you have the exclusive opportunity to be the first realtor to reach out to these prospective clients, ones who are looking to buy or sell a home in the same city or town in Canada where you work as a real estate agent. It’s a great way to supercharge your client prospecting efforts, and you can visit our testimonials page to read how realtors like are very pleased to have taken advantage of it.
