Selling price of a typical city house jumps 19% in a year
Derrick Penner
Sun
Source: Real Estate Board of Greater Vancouver, Fraser Valley Real Estate Board VANCOUVER SUN
Housing sales across the Lower Mainland dropped in August, compared with the same month a year ago, the third month in a row that real estate transactions remained below 2005’s record highs.
For the month, Greater Vancouver recorded 2,998 real estate sales, a 17.8-per-cent decrease from August, 2005. The Real Estate Board of Greater Vancouver also saw an increase in the number of listings for the fourth month in a row.
Single-family home sales dropped 25.4 per cent to 1,167 units, the biggest decline. However, the benchmark price for a so-called typical single-family home in Vancouver hit $649,042, a 19-per-cent increase from a year ago.
In the Fraser Valley, August sales dropped 26 per cent to 1,692 transactions compared with 2005. And while the average price of a single-family home in the Valley has climbed 18.5 per cent over the past year to $483,752, the average condominium price fell 2.3 per cent to $191,451.
Fraser Valley listings also climbed to 6,474, a 14-per-cent increase in the inventory of unsold housing units compared with a year ago.
“I’m not surprised that there has been a year-over-year decline,” Helmut Pastrick, chief economist for Credit Union Central B.C., said in an interview.
Pastrick started sensing a slowdown in sales last fall related directly to the inching up of mortgage rates, which “hasn’t been . . . precipitous, but has been fairly steady.
“This is more an affordability-driven sales decline . . . but not enough [of a decline] to really trigger a significant downturn.”
Pastrick does foresee fewer first-time and low-equity buyers entering the market.
However, Pastrick does believe that employment and income gains that British Columbia is experiencing will help support the real estate market. He expects sales to begin increasing again in 2007, unless harder times befall North American economies.
Dave Rishel, president of the Fraser Valley Real Estate Board, said August sales were still at high levels, and the drop does not represent “quote, ‘the beginning of the bursting of the bubble.’ “
The increase in listings, Rishel added, should give buyers more selection and more time to rationally contemplate purchases.
“I think we are all in agreement that there will be adjustments in the market,” Rishel said. “We’d be fooling everybody to say that there will be a steady cycle all the way up to wherever. We all anticipate these slowdowns from time to time, but [overall] I don’t envision anything radical.”
Rick Valouche, the Real Estate Board of Greater Vancouver’s president, said pressure on prices will start easing when there are more listings available than buyers in the market.
“When that’s going to happen, I don’t know,” Valouche said. “At this point it’s just not happening.”
© The Vancouver Sun 2006
