The 2019 Greater Vancouver real estate market was certainly a year of highs and lows. But as with any market, it was fabulous for some clients who took advantage of the buyer's market to purchase some great deals, but not so great for others whose home value decreased.
Contributing Factors to the Market
Due to uncertainty caused by aggressive taxation of Real Estate in BC, tightening of financing (Stress test), and a naturally cooling market, 2018-2019 resulted in the slowest two years in the Vancouver Real Estate marketplace since 1999.
When buyer’s confidence is shaken, they go to the sidelines and wait. As time goes by, this group grows into pent up buyer demand. At the same time, more buyers add to this demand due to population growth in the region.
We have had 17 months (February 2018-June 2019) where sales were lower than the same month in the previous year; something rarely seen in the Vancouver Market.
Residential sales since July 2019 (6 months in a row) have exceeded the same month in the previous year. This is always a signal of the market starting to recover.
Other signals of recovery:
a) Supply: Unusually low for a period following a slowdown.
b) Media reporting: Starting to report the market upswing.
c) Multiple offers: A significant increase due to buyers acting.
d) Open houses and new listings generating lots of interest.
Pent up demand is a powerful force when coupled with time and a reduction in prices. People’s lives carry on regardless of Government policy. They get married, get older, have babies, want to help their children, move jobs, pass away, or need a bigger/smaller home.
The ten year average for residential sales for the Real Estate Board of Greater Vancouver is 33,000 homes per year. This average actually grows naturally over time due to population growth in the region. Two years of sales at approximately 25,000 units leaves at least 16,000 buyers now waiting to buy, on top of the buyers that will buy regardless of the market, the media or Government actions!
Market Forecast for 2020
The waiting is over and the Real Estate market recovery has begun. It will be a busy Vancouver Real Estate market as the enormous pent up demand starts to take advantage of low interest rates, better prices (for now!) and all of the wonderful things Vancouver has to offer.
As your real estate professionals, we're always here to help. We can fill you in on what’s happening in the local market, help you determine what kind of new home you are qualified to purchase, provide the current value of your home and provide a clear idea of the properties currently available.
You don’t have to try to figure things out on your own! We're here to help.
Even if you’re just at the “thinking about it” stage, we recommend getting the information you need now. That way, you’ll be prepared to make the best decision when you’re ready.
As always, Contact Us if you have any questions or would like some help.