The growing number of residents who are 55 and over will provide a solid demographic underpinning to the health of the condo market
Sun
Healthy economy, low unemployment and steady interest rates all contribute to the continued strong demand for housing.
A report released Monday by the Real Estate Board of Greater Vancouver (REBGV)states that total residential sales reached 3028 units in October 2007, an increase of 11.2 per cent compared to 2,722 sales in October 2006, and a 2.3 per cent decrease compared to the 3,099 units sold in October 2005.
Property listings remain relatively unchanged compared to last year’s levels, with 4,819 active listings at October month-end, compared to 4,862 last year.
“This is only the fourth time in 25 years that sales have surpassed the 3,000 mark in the month of October,” says REBGV president Brian Naphtali. “What we’re seeing is a buoyant market fueled by strong demand from both first-time and repeat buyers.
“The economy is healthy,” Naphtali says. “There’s virtually no unemployment. Interest rates are steady. These are all factors affecting the continued strong demand for housing.”
According to Multiple Listings Service® (MLS®) data, sales of apartment properties increased by 17.4 per cent to 1,368 sales in October 2007 compared to 1,165 sales in October 2006. The benchmark price of an apartment property in Greater Vancouver, calculated by the MLSLink® Housing Price Index, is $371,418, up 11.4 per cent from one year ago.
Sales of attached properties increased by 11.7 per cent in October 2007 to 527 sales, compared to 472 sales in October 2006. The benchmark price of an attached unit is $454,645, up 10.8 per cent from a year ago.
Sales of detached properties increased by 4.4 per cent in October 2007 to 1,133 sales, compared to 1,085 sales in October 2006. The benchmark price of a detached unit is $730,022, up 12.2 per cent from last year.
The growing number of residents who are 55 and over will provide a solid demographic underpinning to the health of condo markets in British Columbia‘s two largest cities, according to recent data by Genworth Financial Canada.
Genworth’s Summer 2007 Metropolitan Condominium Outlook report forecasts condominium prices in Vancouver and Victoria will post average annual increases of about 3.8 per cent and 3.5 per cent, respectively, from 2008 to 2011. Vancouver‘s average resale condo price is forecast to rise from $314,471 in 2007 to $365,491 by 2011, while in Victoria resale condo prices are expected to climb from $264,471 in 2007 to $302,603 in 2011. Victoria, at 30 per cent, boasts the highest percentage of boomers per capita of the eight cities covered in the report, while this segment makes up nearly one quarter of Vancouver‘s population. “These cities historically have attracted individuals over age 55. With their favourable climates and natural beauty, both are desirable places to retire,” said Peter Vukanovich, president Genworth Financial Canada.” In the past decade alone, Victoria‘s over 55 population has risen nearly 22 per cent, while Vancouver had a dramatic 37 percent increase. This target demographic for condominium apartments will help maintain demand in the region and ensure steady price growth.” Census figures release in July by Statistics Canada show the number of Canadians aged 55 to 64, many of whom are approaching retirement, is at a record high of 3.7 million. In British Columbia, developers are responding to the aging population and keeping condo starts in line with demand. Starts will cool this year and next in both cities, as rising inventories of new units accumulate. In the short term, starts will dip, as builders will attempt to lower their inventories of unsold units, then trend upward gradually through 2011.
“There’s no doubt that boomers have played, and will continue to play, a significant role in the B.C. condo market,” said Neil Chrystal, President of Vancouver based Polygon Homes, one of British Columbia’s leading condo developers. “It’s a lifestyle choice for boomers who are downsizing and who have so many options to enjoy the great outdoors in retirement rather than spending their time on maintenance and upkeep of homes.” The Summer 2007 Metropolitan Condominium Outlook reviewed resale condo markets in Quebec City, Montreal, Ottawa, Toronto, Calgary, Edmonton, Vancouver and Victoria. All eight markets registered price growth in 2006 and are forecast to continue to grow this year and through 2011.
Genworth Financial Canada issues reports on Canada‘s housing market in spring, summer and fall; and on Canada‘s condo market in winter and summer; all in conjunction with the Conference Board of Canada.
© The Vancouver Sun 2007
