house for sale vancouver

August Sees Fewest Vancouver Detached Home Sales in 27 Years

Steve Saretsky -

It was another quiet month for Vancouver’s detached housing market. Sales are already tricking in at their lowest count in recent history, and the month of August didn’t fare any better. There were just 116 home sales in the month of August, that was down 30% from a year ago.

Vancouver sales August
Vancouver Detached home sales history for August.

Sales were even lower than August 2016, when home sales crashed after the BC Government abruptly introduced a 15% foreign buyers tax. The count was also lower than August 2008 when liquidity had seized up across the world, just months prior to the collapse of Lehman Brothers.

While volumes sit at record lows, inventory has been slowly creeping higher. Total homes for sale edged higher by just 1% from a year prior. However, inventory for the month of August hasn’t been this high since August 2012.

Vancouver detached inventory
Vancouver Detached inventory for August & 10 year average.

While prices remain incredibly sticky, as they always are in a real estate downturn, there is no doubt they are sliding lower. This is particularly the case in Vancouver’s west side where many detached homes are trading back near 2015 prices, erasing a good portion of the bull market run-up. The Real Estate Board’s official MLS benchmark now shows a 6.5% decline year over year, however the reality is much worse. For illustrative purposes, here’s the 3 month rolling average, which shows detached prices in Vancouver peaked in April 2016 and have since declined 18%.

Vancouver detached prices
Vancouver detached prices using a 3 month rolling average.

Meanwhile, new listings remain weak, declining 17% compared to August 2017. This suggests, along with low sales volumes, that sellers haven’t hit the panic button just yet.

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The Canadian Economy

Steve Saretsky -

Happy Monday Morning! We got a string of new data this past week confirming inflation in consumer goods, and housing are proving to be more than transitory. Canada’s consumer price index continued to drift higher with prices hitting an 18 year high, up 4.7% from last October. The recent floods in BC...

Steve Saretsky -

The calls for impending interest rate hikes continues. CIBC’s chief economist, Benjamin Tal, was out recently suggesting the Bank of Canada could hike its benchmark interest rate at least six times beginning in early 2022. “I think there is a risk of getting into the market at today’s rates,” noted Tal....

Steve Saretsky -

The BC Government announced it is looking at several cooling measures for the housing market in 2022. They have highlighted two measures. The first is an end to the blind bidding process, and the other is a mandatory “cooling off period” which will allow any buyer a 7 day recession...

Steve Saretsky -

The Bank of Canada continues to slowly drain liquidity after flooding the system with a firehose of cash during the pandemic. Bank of Canada governor Tiff Macklem announced the end of Canada’s QE program (also known as money printing). Furthermore, in Macklems words, “We expect to begin increasing our policy...

Steve Saretsky -

Consumer price inflation ripped higher in September, surging 4.4% year-over-year, the fastest pace of price increases in 18 years. Let’s discuss this further. We have an inflation problem and the Bank of Canada remains of the view that inflation will be transitory. Although they really can’t say otherwise, for if...

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The Saretsky Report. December 2022