Home sales continue to slump in Metro Vancouver, Fraser Valley in July

Tiffany Crawford
The Vancouver Sun

 The Real Estate Board of Greater Vancouver says only 1,887 homes were sold in July, a 43.3 per cent decrease compared with the same month last year.

Metro Vancouver home sales were down again in July, according to the Real Estate Board of Greater Vancouver. Photo by Postmedia

Home sales continued to slump last month in Metro Vancouver, as potential buyers back off because of rising interest rates, according to the Real Estate Board of Greater Vancouver.

The board reported Wednesday that only 1,887 were sold in July, a 43.3 per cent decrease from the 3,326 homes sold in July 2021. That number also represents a 22.8 per cent drop from the 2,444 homes sold in June.

Last month’s sales were 35.2 per cent below the 10-year July sales average, according to the report.

The board chair, Daniel John, said homebuyers are exercising more caution because of rising interest rates and inflationary concerns.

“This allowed the selection of homes for sale to increase and prices to edge down in the region over the last three months,” he said in a statement Wednesday.

The total number of homes currently listed for sale on the MLS in Metro Vancouver is 10,288, which according to the report is a 4.4 per cent increase compared to July 2021 and a 1.3 per cent decrease compared to June.

“After two years of market conditions that favoured home sellers, homebuyers now have more selection to choose from and more time to make their decision,” said John, in the statement.

“In today’s changing housing market, both homebuyers and sellers should invest the time to understand what these changes mean for their personal circumstances.”

As for prices, they are still higher than last year at the same time, but down slightly from the month previous. The reports says the composite benchmark price for all residential properties in Metro Vancouver is currently $1,207,400, which is a 10.3 per cent increase over July 2021 and a 2.3 per cent decrease compared with June.

The benchmark price for a detached home in Metro Vancouver is $2,000,600. This represents an 11 per cent increase from last July but a 2.8 per cent decrease from June.

The cost of a condo fared similarly at $755,000 — an 11.4 per cent increase from July 2021 but a 1.5 per cent drop from the month before.

The benchmark cost of a townhome, meantime, was $1,096,500, a 15.8 per cent increase from last July and a 1.7 per cent decrease compared with June.

Areas covered by the Real Estate Board of Greater Vancouver include: 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.

Sales slump in Fraser Valley as well

Similarly, the Fraser Valley Real Estate Board said sales fell again in July, citing interest rate hikes and inflation as likely reasons.

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There were 993 home sales processed during the month of July, down 22.5 per cent from a month earlier and a 50-per-cent drop over July 2021.

July new listings totalled 2,385, a 28-per-cent drop from June and a decrease of 1.9 per cent from July 2021.

Prices also dropped for a fourth consecutive month, though they remain much higher than a year ago. Detached homes sold for a benchmark price of $1.594 million, down 3.5 per cent from June and 10 per cent below a March peak.

But the residential property benchmark is up year over year by 18 per cent.

 

© 2022 Vancouver Sun

Newfoundland housing market – whats happening?

Fergal McAlinden
other

The province is unlikely to see significant home price depreciation, St. John’s broker says

 It’s a market whose pace over the past two years could be described as steady rather than spectacular – and that could be setting Newfoundland and Labrador in good stead as it avoids some of the significant home price depreciation witnessed in other parts of the country in 2022.

Canada’s easternmost province has been spared the sizeable drops in property values that hotter markets like Ontario and British Columbia have experienced since February, with a recent TD report indicating that average home prices actually rose marginally on a monthly basis in June, by 0.9%, compared with a 4.3% national decline.

While home sales elsewhere have also plummeted, Newfoundland and Labrador has posted an increase in the first six months of the year compared with the same period in 2021 – overall sales rising by 3.2% during that time.

Meanwhile, the province remains one of Canada’s most affordable markets to purchase a home: even despite a 9.1% year-over-year increase to the MLS HPI composite benchmark price for homes in St. John’s, that figure stood at $316,300 in June, a fraction of the eyewatering prices in other leading cities.

The market also appears well positioned to ride out the impact of increasing interest rates that are causing headaches for borrowers and would-be buyers in other areas. Robert Jennings (pictured top), broker at the St. John’s-based East Coast Mortgage Brokers, told Canadian Mortgage Professional that the province held a key advantage over other regions because of its strong affordability.

Read next: Housing market risks grow – but long-term outlook healthy, says CEO

“It’s a much smaller market, our own local economy, and we’re not as rate-sensitive over here,” he said. “People are still buying owner-occupied homes. It’s not a $750,000 mortgage, it’s a $250,000 mortgage, and still affordable at 4% or 5% [interest rates].

“We never got the increases that the rest of Canada got. We never got 20% [price jumps] in 2021 or 2020. We were just slow and steady, not too hot, not too cold.”

That’s kept the mortgage and housing markets robust throughout the year to date, Jennings said, with the final two quarters of 2022 expected to see activity continue to tick along.

Upward momentum should continue in the early part of next year, particularly with new home construction ramping up – and that’s also resulting in an uptick in out-of-province investors, he said.

The relatively calm market of recent years means there are fewer borrowers on the margins in Newfoundland, according to Jennings, indicating that not as many homeowners will feel the pinch of rising rates as in other parts of the country.

Those rate hikes are more of an inconvenience than a serious threat to many borrowers, he added, meaning that the cautious approach homebuyers in the province have taken during the pandemic had proven a wise decision.

“Being conservative pays off in times like these,” he said. “We’re still severely underpriced compared to the national average, so I don’t think rate hikes are scaring everybody.

Read next: Supply remains housing market’s number-one issue, says CMHC’s Dugan

“We’ve got to deal with rate hikes – a lot of mortgages are still coming up for renewal, so people have to deal with [those] regardless, but I’d rather have a $300,000 mortgage come up for renewal than an $800,000 mortgage come up for renewal.”

While activity remains strong, much of it appears to be propped up by St. John’s: the capital saw its year-over-year residential sales activity rise by 5.2% in June, helping paper over a significant 12.9% decline elsewhere in the province.

That said, active residential listings across Newfoundland and Labrador had fallen sharply in June compared with the same month last year, slipping by over 33% to 3,133 units. That marks the first time active listings have been so low in more than a decade, according to the Newfoundland and Labrador Association of Realtors.

Home price growth could continue across the province for the remainder of the year as a result, Jennings said – an outcome that would set the region in stark contrast to other markets across the country in the second half of 2022.

“I would estimate probably another 8-10% [price growth],” he said. “And considering that a lot [of other markets] will probably finish at zero or a negative year over year compared to last year, I’d be really glad to be in this market, for sure.”

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Home buyer demand continues to ease across Metro Vancouver

REBGV Staff
REBGV

 Metro Vancouver’s housing market has entered a new cycle marked by quieter home buyer demand and a gradual rise in the supply of homes for sale.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,887 in July 2022, a 43.3 per cent decrease from the 3,326 sales recorded in July 2021, and a 22.8 per cent decrease from the 2,444 homes sold in June 2022.

Last month’s sales were 35.2 per cent below the 10-year July sales average.

“Home buyers are exercising more caution in today’s market in response to rising interest rates and inflationary concerns,” Daniel John, REBGV Chair said. “This allowed the selection of homes for sale to increase and prices to edge down in the region over the last three months.”

There were 3,960 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in July 2022. This represents a 9.5 per cent decrease compared to the 4,377 homes listed in July 2021 and a 24.7 per cent decrease compared to June 2022 when 5,256 homes were listed.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 10,288, a 4.4 per cent increase compared to July 2021 (9,850) and a 1.3 per cent decrease compared to June 2022 (10,425).

“After two years of market conditions that favoured home sellers, home buyers now have more selection to choose from and more time to make their decision,” John said. “In today’s changing housing market, both home buyers and sellers should invest the time to understand what these changes mean for their personal circumstances.”

For all property types, the sales-to-active listings ratio for July 2022 is 18.3 per cent. By property type, the ratio is 11.8 per cent for detached homes, 20 per cent for townhomes, and 24.5 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,207,400. This represents a 10.3 per cent increase over July 2021 and a 2.3 per cent decrease compared to June 2022.

Sales of detached homes in July 2022 reached 523, a 50.2 per cent decrease from the 1,050 detached sales recorded in July 2021. The benchmark price for a detached home is $2,000,600. This represents a 11 per cent increase from July 2021 and a 2.8 per cent decrease compared to June 2022.

Sales of apartment homes reached 1,060 in July 2022, a 36.4 per cent decrease compared to the 1,666 sales in July 2021. The benchmark price of an apartment home is $755,000. This represents a 11.4 per cent increase from July 2021 and a 1.5 per cent decrease compared to June 2022.

Attached home sales in July 2022 totalled 304, a 50.2 per cent decrease compared to the 610 sales in July 2021. The benchmark price of an attached home is $1,096,500. This represents a 15.8 per cent increase from July 2021 and a 1.7 per cent decrease compared to June 2022.

 

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Economists highlight the Toronto housing market’s 2022-23 prospects

Ephraim Vecina
other

Some disturbing trends are already apparent, market observers warn

While demand will remain robust, the Toronto housing market should brace for considerable price declines in the near future, according to a recent Toronto Star poll of economists.

The price-drop trend is already apparent, with residential sale values across Toronto having fallen by 3.3% from their peak in March. The decreases were even worse in Ontario, with some cities posting declines of 10% to 15%, the Toronto Star reported.

The surveyed economists’ current consensus is of a decline of at least 10% in home prices. The average home price in Toronto is expected to settle at $1.03 million in 2023.

Canadian Imperial Bank of Commerce is anticipating a 15% decline by the end of 2022.

“When the Bank of Canada raises interest rates, it’s aiming to slow economic growth by taking a bite out of activity in the interest-sensitive parts of the economy, and housing is high on the list of sectors that are exposed to the impact of higher rates,” said Avery Shenfeld, senior economist at CIBC.

Read more: GTA residential rent surges

BMO even ventured so far as to project a 20% drop by the middle of next year. This will accompany a decline of 23% in sales activity, mainly due to deceleration in Ontario and British Columbia.

“Given the exceptional deterioration in affordability – first due to the rapid run-up in prices, then by the rapid rise in interest rates – as well as the sudden turn in sentiment around the market, it’s difficult to see anything other than a meaningful correction ahead for Canadian housing,” said Doug Porter, senior economist at BMO.

“Each city will have its own story, and may fare differently – driven both by how far it surged in recent years, and the outlook for the local economy – but it will be a challenging period for almost all major housing markets.”

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Victoria developer donates $15 million in land for social housing

Darron Kloster
Western Investor

‘Once-in-a-lifetime’ donation will help develop 180 affordable homes by 2027

 Developers behind plans for a large mixed-used community on the Roundhouse lands in Greater Victoria, B.C., have donated a $15-million site in Vic West to the Greater Victoria Housing Society, which plans to build an 18-storey tower with 180 rental units of affordable housing.

The land on the southeast corner of Esquimalt Road and Catherine Street is part of ­Bayview Place’s master plan for eight other residential towers ranging from 18 to 28 storeys and the commercial Roundhouse development on the 10 remaining acres of the former E&N Railway lands.

James Munro, director of real estate for the Greater Victoria Housing Society, said the donation by Bayview Place owners Ken and Patricia Mariash is the largest the group has ever seen and could be a record for the Island and even the province for an affordable-housing project.

“It’s very significant and it’s a perfect spot for families and individuals on a bus stop, transportation corridors into downtown, across from a major park and close to two other properties the society operates,” said Munro.

Previously, Bayview had been trying to blend affordable housing with its other planned towers on the site. The idea of donating the corner lot arose after discussions with mayor and council and community groups, Ken Mariash said.

“Many of the city hall applications are an argument about how much and this and that,” he said. “We didn’t want to be trying to negotiate less than what should happen, so we thought we’d make it large.”

Munro said the society hopes to get the project before Victoria council before the Oct. 15 civic elections and to a public ­hearing before the end of the year. That way, detailed designs of the building can get underway, with a plan to start construction in 2024, with occupancy by 2027.

Munro said quick approvals from council are essential to the viability of the 18-storey tower, pointing to rising construction costs and interest rates.

“If the project is not approved soon, the project may not be able to proceed and these 180 new affordable homes will not be developed in the near term,” the housing society said in a statement.

The estimated capital cost for the development is $72 million, with construction costs estimated at $52 million.

The housing mix is expected to include studios, one-, two- and three-bedroom units and possibly six to 12 three-bedroom townhomes for families. An outdoor play and seating area will be included and there are plans for 80 parking stalls and 180 spaces for bicycles.

Munro said the development will attract a range of incomes from “working professionals to working poor” or those making $30,000 to $120,000 a year.

All of the units will have below-market rental rates and 30% of those will be at 80 per cent of the median market rate set by the Canada Mortgage and Housing Corp. — from $775 a month for a studio and $895 for one-bedrooms to $1,500 for three-bedrooms (in 2027 dollars), said Munro.

The remaining 70 per cent of the units will rent in the $1,300 to $2,950 range, also in 2027 dollars.

The Greater Victoria Housing Society currently has 17 buildings in the region, housing about 1,000 people, and the latest project is much needed.

“Land is the No. 1 constraint to develop new affordable housing,” said Virginia Holden, executive director of the Greater Victoria Housing Society. “This once-in-a-lifetime land donation will provide a significant project that will build a strong community in Vic West.”

 

© 2022 Western Investor

Five B.C. towns where you can buy a home for $500,000

Shawn Conner
The Vancouver Sun

Here are five contenders based on supply, variety and a price tag hovering around $500k.

 The City of Nanaimo is situated on the east coast of Vancouver Island, the namesake of the famous dessert bar and birthplace of Diana Krall. Photo by Courtesy of City of Nanaimo /PNG

A buyer’s market may be emerging in the Lower Mainland but, for many, housing prices remain out of reach.

Rising interest rates will likely mean fewer buyers and a slowdown in average price increases. A general downward trend in home sales volumes and average price increases across the province is expected. Still, the average price of a home likely won’t be dipping much below $1 million any time soon.

So what’s a prospective buyer to do? Well, they don’t mind looking outside of the Lower Mainland and into some other corners of the province, relatively reasonably priced homes can still be found. Drawing on a 2022 Moving Waldo survey and a 2021 Zolo analysis of the most affordable places to live in B.C., we narrowed down the contenders to five based on supply, variety, and a price tag hovering around $500k. (Prices in effect as of Aug. 2.)

“While cities and towns outside of the Lower Mainland had seen significant upward pressure on pricing during the pandemic, there are still places in B.C. where $500,000 goes a pretty long way,” realtor Mary Cleaver of the Mary Cleaver Group said.

“With recent interest rate hikes, homes in many of these areas have begun to see home prices decline. I suspect further moves by the Bank of Canada could lead to more affordability in secondary markets in the coming months.” 

 

Vernon consistently places on most-affordable lists. Photo by Courtesy City of Vernon /PNG

1. Vernon

It may be the commercial hub of the North Okanagan, but Vernon consistently places on most-affordable lists. However, many of the houses available in the $500k range are on leased land. Most, if not all, product for that price or less, and on non-leased land, are townhomes, like a two-bedroom, two-bathroom 1,190-square-foot residence priced at $499,900.

 

2. Prince George

This sunny northern B.C. town of 74,000 is a haven for outdoor enthusiasts and financially strapped homebuyers. Half-a-million can still purchase a house with three, four, five or even six bedrooms, and there’s a fair amount on the market. We like a split-level three-bedroom home with a big backyard and a flex space currently set up as a martial arts dojo. It’s going for $485,000 but, as the listing says, “At this price point, this home won’t last long!”

3. Nanaimo

Situated on the east coast of Vancouver Island, the namesake of the famous dessert bar and birthplace of Diana Krall has mostly condos and townhomes for half-a-million dollars and under. A $489,000 two-bedroom, two-bathroom 994-square-foot townhouse in the Pleasant Valley neighbourhood is near amenities and opens onto a landscaped backyard. A two-bedroom, two-bathroom, 1,091-square-foot condo near Long Lake is listed at $499,900. Also available: a two-bedroom, one-bathroom, 884-square-foot house near downtown, with nine-foot-high ceilings, a claw-foot tub, and a small view of the ocean from the deck. Built in 1914, it’s definitely a fixer-upper.

 

4. Penticton

The sky’s the limit for half-a-million loonies in this South Okanagan town—if a buyer is in the market for a townhouse or condo. A three-bedroom, two-bathroom, 1,500-square-foot townhouse with a view of Penticton Creek is priced at $495,000, and a two-bedroom, two-bathroom 1,085-square-foot condo located alongside the same creek is going for $4k more. A three-bed, two-bath home in a townhouse complex priced at $499,900 shares an outdoor pool with other units. The bonus of living in Penticton is, of course, access to the mountains, parks, and lakes that make the area a favourite of golfers, hikers, boaters, and skiers.

 

5. Nelson

The West Kootenay city of 11,000 boasts a thriving cultural scene, a brewery, and close proximity to the Whitewater Ski Resort and other outdoor activities. Buying-wise, Nelson’s housing product for $500k or less includes houses, townhomes, and duplexes. A three-bed, two-bath 1,230-square-foot heritage home priced at $484,888 features a deck and is close to a picturesque downtown of heritage buildings.

 

© 2022 Vancouver Sun