With higher interest rates, Metro Vancouver records slower home sales in May

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Home sales within the jurisdiction of the Real Estate Board of Greater Vancouver (REBGV) returned to more typical seasonal levels in May 2022, and the Bank of Canada’s decision to hike interest rates is being cited as the main reason.

Over the month, the number of home sales within REBGV dropped by 31.6% year-over-year to 2,918 units sold. This figure is also a drop of 9.7% from the 3,232 units sold in April 2022, indicative of the earlier impacts of the initial rate hikes.

The total sales for May 2022 were 13% below the 10-year average for the month.

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“With interest rates rising, home buyers are taking more time to make their decisions in today’s housing market. Home buyers have been operating in a frenzied environment for much of the past two years,” states Daniel John, chair of REBGV, in a statement.

“This spring is providing a calmer environment, with fewer multiple offer situations, which is allowing buyers to explore their housing options, understand the changing mortgage market, and do their due diligence.”

REBGV’s jurisdiction entails Vancouver, Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Richmond, South Delta, Squamish, Sunshine Coast, West Vancouver, and Whistler. Other areas of Metro Vancouver — including Surrey, White Rock, North Delta, and Langley — are within the separate jurisdiction of the Fraser Valley Real Estate Board.

In May 2022, 6,377 homes were newly listed for sale in REBGV, representing a 10.5% decrease from the same month in 2021 and a 4.4% drop from the previous month. The total number of homes listed for sale reaches 10,010 units, representing an 8.8% drop from May 2021 and a 13.8% increase from April 2022.

The benchmark home prices within REBGV climbed up to $1.26 million in May 2022, which is a 14.7% jump from May 2021 and a 0.3% decrease from April 2022.

Within the Vancouver Westside, benchmark home prices reached $1.375 million, representing a 0.6% drop from the previous month, a 0.5% increase over the previous three months, and a 12.8% increase since a year ago. As for the Vancouver Eastside, benchmark home prices reached $1.249 million, a 0.3% decrease from the previous month, a 2.2% increase over three months, and a 12.8% increase from May 2021.

The recent downward price trend is now very evident.

Across REBGV jurisdiction, the sales-to-active listings ratio for the month was 29.2%, including 18.3% for detached homes, 35.5% for townhomes, and 38.1% for apartments. Analysts note a downward pressure on home prices occurs when the ratio dips below 12% for a sustained period, while home prices go up when the ratio exceeds 20% for several months.

“Upward pressure on home prices has begun to ease in the housing market over the last two months,” continued John. “Where home prices go next will depend on housing supply. While we’re beginning to see modest increases in home listings, we still need housing supply totals to more than double to bring the market close to balanced territory.”

May 2022 home sales statistics: REBGV

Detached homes
- Number of units sold: 793 (-44% over May 2021)
- Active listings: 4,337
- Benchmark price: $2,093,600 (+15% over May 2021; -0.4% over April 2022)
- Average days on market: 19
Apartment homes
- Number of units sold: 1,605 (+21.7% over May 2021)
- Active listings: 4,210
- Benchmark price: $779,700 (+21.7% over May 2021; +0.4% over April 2022)
- Average days on market: 16
Townhouse sales
- Number of units sold: 520 (-35% over May 2021)
- Active listings: 1,463
- Benchmark price: $1,141,200 (+21.5% over May 2021; -0.6% over April 2022)
- Average days on market: 14

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