Greater Vancouver Market Report for May

Like the weather itself in May, the Greater Vancouver housing market was unseasonably hot but with subtle signals of cooling.

May marked the second consecutive month with sales declining in absolute numbers from the previous month, but with a 187 percent increase in transactions compared to May of last year, it is hard to say this market is slowing. May received a boost from a sudden change in the ‘mortgage stress test’ in mid-month that extended the stress to all homebuyers, not only to those with a 20 per cent down payment. That last-minute change caused some buyers to push to close on sales before the June 1 deadline for the new stress test to begin.

Under the revised stress-test regulations, buyers must qualify at a five-year mortgage rate of 5.25 per cent, which is much higher than the actual mortgage rates available. (Scotiabank and National Bank , as examples, are currently offering five-year fixed rates of 2.14%). Buyers don’t have to pay the higher rate, just prove they can afford it.

Apparently, many can. During May, 4,346 homes were sold in Greater Vancouver and another 2,951 in the Fraser Valley, where sales were up 267%, year-over-year. Ponder these facts for a moment.

May, therefore, set an astounding pace of 235 sales per day, every day, all month long, or $11.1 million worth of transactions every hour, based on the composite Lower Mainland home price of $1.14 million.

Will the stress test affect early June sales? Not likely. June 15 marks the Phase 2 relaxing of B.C.’s COVID-19 restrictions, which could provide further confidence and impetus to the housing market.

Say what you will about the effects of the pandemic on the real estate market, optimism is always a good thing when it comes to real estate.

What could and would cool the summer market, however, is a real and sustained uptick in actual mortgage rates – and that is a possibility due to inflation fears.

You may have noticed that lumber prices are up 300% in the past year, copper prices hit a record high in May. Global oil prices are 80% higher than a year ago and the Canadian dollar is at a six-year high. And have you bought a T-bone steak or filled your car with gas recently? This all signals inflationary pressure and a potential rise in the Bank of Canada rate, which has its next setting on June 9.

Best advice for homebuyers: Lock-in a prequalified mortgage rate for 90 days right now.

Best advice for home sellers: Accept the best offer you get and don’t bank on multiple offers over your asking price.

We are in the midst of an unprecedented housing sales cycle right across the Lower Mainland but, like the May weather, it can cool without much warning.

Metro Vancouver May Highlights

Top detached housing sales: Surrey, with 600

Highest median detached house price: West Side, Vancouver, at $3,580,000

Record price for an East Vancouver detached house: $4 million, sold May 15

Lowest median condo price: Maple Ridge, at $458,000

Lowest median townhouse price: Surrey, at $696,000

Regional reports 

Greater Vancouver: High prices, tougher mortgage qualification regulations and demographics are having an effect on the type of homes selling in Greater Vancouver. Sales of detached houses are now being eclipsed by sales of lower-cost townhouses and condominium apartments. This is partly a reflection of the growing influence of Millennials, who are replacing baby boomers as the prime home consumer, since Greater Vancouver has a disproportionately high number of Millennials. 

In May detached home sales were up 166% year over year, but townhouse sales were up by 168% and condo apartment sales increased by 213% in the same period. Much of this is based on the fact the typical detached house in May sold for $1.8 million, while the townhouse benchmark was about half that, at $936,000, and condo apartments sold for a benchmark price of $737,100. Also, while detached house prices are similar across the region, buyers can find condo apartments for less than $600,000 in at least eight communities, including most of the Tri-Cities and South Delta. Also, while detached house prices have increased nearly 28% in the past year, townhouse prices are up 16.8% and condo prices have risen less than 8%. Clearly, many buyers, both Millennials and downsizing baby boomers, now see strata as the best value in Greater Vancouver.

In May, more than 7,000 new listings were added to the market. This was down from April and a signal that active listings may have peaked. With two straight month of lower sales month-over-month, buying levels may have also peaked.

Make no mistake it is a very active market still; we’ve just fallen off the cataclysmic highs of March and April. And that’s not a bad thing.

Vancouver Westside: There were 2,396 active listings on the Westside market in May and total sales, at 736, were also down 4% from April. With a sales-to-listings ratio of 50% there is now about a four-month inventory on the market. But the townhouse supply is disappearing more quickly. Only 125 new townhouses are under construction, but most of these have pre-sold months ago. More telling, just three new townhouse units have started so far this year. The May sales-to-new-listing ratio of existing townhouses was 60% and the benchmark price is rising 2.6% per month – twice as fast as detached houses or condos – and hit $1,274,000 in May. If you own a Westside townhouse and are considering selling, now is the time to list.

Vancouver East Side: For the first time ever, an East Side house on a 33-foot lot sold for $4 million. There were multiple bids, all from Millennial buyers, for the East 33rd house near Main Street that sold May 15. This shows just how hot the East Side has become. The benchmark price has risen 9.2 per cent in the last three months to hit $1,709,700 in May. Still, as we have noted before, East Vancouver detached houses have huge potential because of the Broadway Corridor SkyTrain extension and new employment centres, especially in the high-tech and medical sectors. We don’t think $4 million will be record East Vancouver price for long. In May, East Side total sales were down 15% from April, but up 184% from May of last year. With a sales to listing ratio of 56%, this is seller’s market with legs. 

North Vancouver: North Vancouver May sales marked one of the biggest declines in the Metro region, dropping 25% from a month earlier, to 358 transactions. Condo apartments were the only sector posting higher sales in May than in April, with an increase of 21% to 207 transactions. Condo prices are now up 10% from a year ago to $654,000, but this is $400,000 less than a townhouse and $700,000 below the $1,902,000 benchmark for a detached house in North Vancouver. Total North Vancouver listings fell 11% month-over-month in May, which kept the sales-to-listing ratio at 60%, still a very active seller’s market. But the condo market is where the action is happening. 

West Vancouver: West Vancouver May sales were more than double that of May 2020, but fell a sharp 22% from April, with a total of 90 sales in the month. As usual, detached houses led the transactiosns, with 60, at benchmark price of $3,139,800, a price up nearly 20% (that is around $600,000) from a year earlier. There were also 28 condo sales in May, up from 21 in April, at a benchmark price of $1,131,000, by far the highest price in Metro Vancouver. The month’s supply of total residential listings is up to 7 month’s supply and sales to listings ratio is 34%, which signals a balancing market.

Richmond: Total housing sales were 505 in May,– down 24% from April 2021, but up a startling 232% compared to May 2020. New Listings in May were down 16% compared to April 2021. Month’s supply of total residential listings is up to 3 month’s supply and the sales-to-listings ratio of 60%, sure signs of a continued seller’s market.

Burnaby East: May housing sales reached 53 transactions. This was down from 76 (30%) in April 2021, but 194% higher than in May 2020. Active Listings were at 117 at month end compared to 108 at that time last year and 112 at the end of April. New Listings in May were down 30% compared to April 2021, up 81% compared to May 2020 and up 56% compared to May 2019. Month’s supply of total residential listings is up to 2 month’s supply (seller’s market conditions) and sales to listings ratio of 68% compared to 68% in April 2021, 42% in May 2020 and 50% in May 2019.

Burnaby North: Total housing sales in May were 241– down from 316 (24%) in April 2021,but up from 79 (205%) in May 2020. New Listings in May were down 17% compared to April 2021, and up 146% compared to May 2020. Month’s supply of total residential listings is steady at 2 month’s supply (seller’s market conditions) and sales to listings ratio of 62% compared to 68% in April 2021, 50% in May 2020 and 44% in May 2019.

Burnaby South: Total housing sales in May were 231 – down from 268 (14%) in April 2021, but up from 64 (261%) in May 2020, up from 131 (76%) in May 2019; Active Listings were at 664 at month end compared to 450 at that time last year and 629 at the end of April; New Listings in May were down 13% compared to April 2021, up 204% compared to May 2020 and up 21% compared to May 2019. Month’s supply of total residential listings is up to 3 month’s supply (seller’s market conditions) and sales to listings ratio of 59% compared to 59% in April 2021, 50% in May 2020 and 40% in May 2019.

New Westminster: Total housing sales in May were 194 – down from 199 (3%) in April 2021, up from 73 (166%) in May 2020, up from 127 (53%) in May 2019; Active Listings were at 375 at month end compared to 356 at that time last year and 366 at the end of April; New Listings in May were down 10% compared to April 2021, up 74% compared to May 2020 and down 1% compared to May 2019. Month’s supply of total residential listings is steady at 2 month’s supply (seller’s market conditions) and sales to listings ratio of 72% compared to 66% in April 2021, 47% in May 2020 and 47% in May 2019.

Coquitlam: Total housing sales in May were 350 – down from 362 (3%) in April 2021, up from 132 (165%) in May 2020, up from 205 (77%) in May 2019; Active Listings were at 759 at month end compared to 760 at that time last year and 688 at the end of April; New Listings in May were down 7% compared to April 2021, up 57% compared to May 2020 and up 10% compared to May 2019. Month’s supply of total residential listings is steady at 2 month’s supply (seller’s market conditions) and sales to listings ratio of 61% compared to 58% in April 2021, 36% in May 2020 and 39% in May 2019.

Port Moody: Total housing sales in May were 102 – down from 126 (19%) in April 2021, up from 46 (122%) in May 2020, up from 62 (65%) in May 2019; Active Listings were at 182 at month end compared to 211 at that time last year and 178 at the end of April; New Listings in May were down 15% compared to April 2021, up 56% compared to May 2020 and up 19% compared to May 2019. Month’s supply of total residential listings is up to 2 month’s supply (seller’s market conditions) and sales to listings ratio of 68% compared to 71% in April 2021, 47% in May 2020 and 49% in May 2019.

Port Coquitlam: Total housing sales May were 165 – down just 1% from April 2021,but up 175%) compared to May 2020. Active Listings were at 270 at month end compared to 190 at that time last year and 242 at the end of April; New Listings in May were down 5% compared to April 2021, up 175% compared to May 2020 and up 34% compared to May 2019. Month’s supply of total residential listings is up to 2 month’s supply (seller’s market conditions) and sales to listings ratio of 66% compared to 64% in April 2021, 66% in May 2020 and 71% in May 2019.

Pitt Meadows: Total housing sales in May were 54 – up from 48 (13%) in April 2021, and 135% higher thanin May 2020, Active Listings were at 63 at month end compared to 103 at that time last year and 63 at the end of April; New Listings in May were down 7% compared to April 2021, up 33% compared to May 2020 and up 7% compared to May 2019. Month’s supply of total residential listings is steady at 1 month’s supply (seller’s market conditions) and sales to listings ratio of 84% compared to 69% in April 2021, 47% in May 2020 and 66% in May 2019.

Maple Ridge: May housing sales hit 286 – down 16%)from April 2021, but up from 111 (158%) in May 2020. Active Listings were at 444 at month end compared to 633 at that time last year and 434 at the end of April; New Listings in May were down 11% compared to April 2021, up 93% compared to May 2020 and up 9% compared to May 2019. Month’s supply of total residential listings is up to 2 month’s supply (seller’s market conditions) and sales to listings ratio of 72% compared to 77% in April 2021, 54% in May 2020 and 47% in May 2019.

Ladner: Total housing sales were 49 – down 44%)from April 2021, and up from 145% from May 2020. New Listings in May were down 29% compared to April 2021, up 35% compared to May 2020 and down 24% compared to May 2019. Month’s supply of total residential listings is steady at 2 month’s supply (seller’s market conditions) and sales to listings ratio of 75% compared to 80% in April 2021, 42% in May 2020 and 48% in May 2019.

Tsawwassen: Sales totalled 95 in May, up from 82 (16%) in April 2021, and up from 35 (171%) in May 2020. New listings in May were up 2% compared to April 2021, up 47% compared to May 2020 and up 36% compared to May 2019. Month’s supply of total residential listings is steady at 2 month’s supply (seller’s market conditions) and sales to listings ratio of 74% compared to 66% in April 2021, 40% in May 2020 and 40% in May 2019.

Surrey: If you have been wondering where the strongest detached housing market in Metro Vancouver is, look to Surrey. In May, 600 detached houses sold in Surrey, which is more than sold in Vancouver, Burnaby and Richmond combined. Surrey detached sales were up 358% compared to May 2020 the highest increase in the Metro region and sales were virtually unchanged from April. The benchmark Surrey detached house price is now $1,429,300, up 31.5% from a May of last year. In all, Surrey accounted for nearly half – 1,431 – of the 2,951 total housing sales in the Fraser Valley during May.

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