Updated August 2016
According to the British Columbia Real Estate Association (BCREA), home sales in metro Vancouver region are showing a “cooling trend” since March. The 9,900 residential unit sales recorded by the Multiple Listing Service (MLS) in July in B.C. is down 3.4 per cent from the same month last year.
According to a press release on August 11, 2016, Cameron Muir, BCREA Chief Economist said, “housing demand has moderated in many regions of the property, after setting records earlier in the year.” This changing pace of home sales will likely boost the inventory of homes for sale. Muir added that the rate of home price appreciation is expected to slow from the “unsustainable levels” reached in spring.
The average home price in the province is $663,411, up 9.1 per cent from last year.
The rapid acceleration in real estate prices over the past year in Greater Vancouver has elicited critical attention from the BCREA. Even in each of the first three months of 2016, price increases exceeded the 20% year-over-year growth. An economic forecast called Market Intelligence was released on June 23, 2016 by the BCREA to take a critical look at home prices since 1981 and predict what may happen next in the Greater Vancouver housing market.
The report shows that year-over-year increases of 20% or more are far from unusual in Vancouver, and there have been 46 months since 1981 in which this was the case, 38 of which were before 2010. In most cases, periods of price acceleration were followed by “gradual moderation of price growth” within 12 months. The study concludes that:
Using history as a guide to what comes next for the Vancouver housing market, one would expect that without a major economic shock or significant change in housing policy, that conventional market dynamics of supply and demand will take hold and growth in home prices will likely trend lower over the next 12 months. (Market Intelligence, BCREA, June 23, 2016)
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