March 7, 2013

Greater Vancouver Real Estate Market: February 2013

The report everybody was waiting for is out: the Real Estate Board of Greater Vancouver’s sales, listings and house price statistics for February.  New listings picked up in January. Would sales follow? Would we start to see an awakening of the residential real estate market after an extra-long winter’s nap?

Sales and Listings

We did not. The 1,797 MLS® home sales in the region were the second-lowest total for February in 12 years, and 30.9 per cent below the 10-year average. Compared to last February, home sales were down 29.4 per cent.

Detached houses were the least favoured. House sales were down 36.1 per cent from February 2012, while apartments declined 25.5 per cent and townhouses, 21.5 per cent. All housing types saw higher sales in February than January, with townhouse sales increasing the most, but sales always increase as we head into spring.

There was more choice for buyers in February. Active listings increased to 13,246, after four months of steady decline. They gained 11.6 per cent over January, and 5.2 per cent over February 2012. This despite the fact that new listings faded to 4,833 after January’s influx of 5,128 new listings.

Even with low sales and slightly higher active listings, the sales-to-listings ratio actually increased two points to 12.2 per cent. According to the REBGV, that puts it on the cusp of a balanced market. It hasn’t been over 11 per cent since last June.

The REBGV sees this as a promising sign. President Eugen Klein (video at bottom of article) says, “With a two-point increase in our sales-to-active-listings ratio and a reduction in the average number of days it’s taking to sell a home, February showed some subtle indications of a changing sentiment in the marketplace compared to recent months.”

Mind you, a two-point increase in the sales-to-active-listings ratio is modest this time of year. Spring is typically the major selling period of the year and buyers start to come out in force in February. Last year the increase from January to February was 6.4 per cent.

Benchmark Price (MLS® Home Price Index)

About 54 per cent of all detached houses in Vancouver city limits are assessed at over $1 million according to a study by Andy Yan of Bing Thom Architects, quoted in a recent Vancouver Sun article.

A quick search of the listings on our site found only one house on its own land under $1 million on the west side (two others were on leased land). On the east side we found 141 houses under $1 million. Only three were under $600,000.

House prices that would draw gasps in other cities are the norm in Vancouver. That’s true of West Vancouver, North Vancouver, Richmond and Burnaby North and South as well. All have average benchmark prices of $900,000 or over.

No wonder Greater Vancouver is the star of every overvaluation/unaffordability study that comes out. And no wonder there’s an almost rabid expectation that prices will fall.

But no, in February benchmark prices for houses, townhouses and apartments rose ever so slightly from January.

Townhouse prices went up in all but three areas: Squamish, Vancouver East and Whistler. Prices for condos went up everywhere but Coquitlam, Maple Ridge and Port Coquitlam. Detached house prices dropped in eight out of the twenty REBGV areas: Burnaby South, Maple Ridge, Port Coquitlam, Port Moody, Richmond, Sunshine Coast, Vancouver East and West Vancouver.

These are all very slight increases/decreases, and there’s no telling if they signal a change of direction. When we asked local realestate professionals how they thought the spring real estate market would go the consensus was that we’ve seen the correction from the peak prices of last April and May, and prices would remain flat.