Today I’ve got a quick market update for you for Metro Vancouver. I’ve also got some predictions on what we’ll see in the next year.
First, let’s take a look at the attached homes market. Sales are up 26% from the same time last year, which is huge. We also saw a 15% sales to active ratio. I’ve been seeing more and more homes selling below their tax-assessed values for a loss. The losses range from 5% to 23%. The inventory for detached homes is still 9% lower than the 10-year average, however.
As for the condo market, we saw a 66% sales to active ratio, which is up 5% from last month. The condo market is still red hot, as evidenced by the 23% jump in the market from last year. The total inventory of condos on the market is about 60% less than the 10-year average.
What is causing these conditions? Here are five factors:
- Buyers are rushing to the market to beat out the new mortgage stress testing in Canada. The new stress testing doesn’t increase your interest rate, but it does use an additional 2% on top of the best rate offered by your lender to get your mortgage qualifying amount. With the new rules, you’ll be able to borrow more money and pay less for it.
2. Population growth is at a substantial rate. We don’t have enough homes to meet demand right now.
3. Millennials and first-time buyers still think it’s a good time to buy.
4. Investors still think Vancouver is a good place to invest.
5. We continue to have very low interest rates.The five-year average is still under 4%.
On to my predictions. For detached homes, I see the market starting slow in 2018 but picking up as the year goes on. I think we’ll see an overall increase of about 2%. For the condo market, I think we’ll continue to stay very busy and see another 15% increase in pricing.
If you have any questions for me, don’t hesitate to reach out and give me a call or send me an email. I look forward to hearing from you. Merry Christmas and happy New Year!