23% fewer homes sold in Metro Vancouver this year to date
This year to date, as of the end of June, over 14,300 homes have been sold within the jurisdiction of the Real Estate Board of Greater Vancouver (REBGV), representing a decrease of over 23% compared to the same period in 2022.
Although home sales volumes remain lower overall, there was an uptick in activity earlier in 2023 when it was assumed the Bank of Canada’s policy interest rate hikes had come to an end. The latest surprising two 0.25% consecutive hikes into the summer, sending the rate to 5% as of last week, put an added damper to a the already slowing market in the spring.
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According to a new report by RE/MAX analyzing trends, move-up buyers have been particularly active in 2023 from pent-up demand, after delaying their purchase in late 2022.
Move-up buying is the practice of relocating to a larger home and/or a more preferable neighbourhood, which was particularly experienced early on in the pandemic.
RE/MAX suggests Vancouver’s suburban areas saw the strongest move-up demand, including Willoughby Heights and Walnut Grove in Langley, Maple Ridge, and the Fraser Valley.
“Equity gains over the past five years have been a boon to move-up buyers, many who have had an easier time qualifying for a mortgage. Some move-up buyers, however, have moved farther afield to qualify, expanding their search to peripheral areas such as Chilliwack and Mission where housing values are more affordable,” reads the market update.
As usual, there will be a seasonal summer slowdown in home sales, with market activity rebound in the fall. If there are further increases in the policy interest rate, the slowdown could be further extended.
It should be noted the REBGV’s jurisdiction only covers portions of Metro Vancouver, including the city of Vancouver, and does not encompass areas such as the city of Surrey, which is under the Fraser Valley Real Estate Board.
Separate reports and data on the rental housing market suggest move-up renting is currently highly challenging, if not impossible, due to the extremely low vacancy rate and escalating rents between tenancy changeovers.