February 2016 - Market News
As we kick off the new year I wanted to say how honoured I am to have been awarded one of the 2015 Top Producer awards for Royal LePage Sussex. In addition to that I received the 2015 Directors Platinum Award which places me in the top 5% of Royal LePage Realtors in the Lower Mainland. I owe much of this success to the referrals from my friends and clients, and wanted to take this opportunity to thank you for trusting me with your real estate needs. And to ask you to please keep the referrals coming....
Demand Remains High
For Foreign Investors
There never seems to be a shortage of things to talk about when it comes to Vancouver area real estate. January sales were 46% above the 10 year sales average for the month and it ranked as the second highest January on record. Just a few weeks ago, Vancouver was rated the third least affordable housing market in the world (Falling behind Sydney and Hong Kong respectively).
January got a jump when a 63 year old home in Ambleside sold for $890,000 above the asking price after being on the market for 10 days. In the Arbutus neighborhood of Vancouver West, a 70 year old home was sold for $790,000 over the asking price in just 6 short days. Many homes are being bought sight unseen and sizable new builds are happening as fast as permits can be issued. Predictably, any conversation of Vancouver’s well known housing prices turns to the influence of foreign buyers, particularly from mainland China.
As the Asian stock market tumbled at the end of 2015, the low Canadian dollar steered many Chinese investors towards Canada, in particular, our real estate market. Prices in and around Vancouver have continuously seen record highs and the REBGV announced that overall 2015 “home sales were the highest annual total in history.” Many of our American neighbors are also jumping into the Vancouver and Whistlers real estate market as their strong dollar makes our real estate a good investment.
A recent news article reported that Chinese investors are being approached by companies who are searching for investors to fund British Columbia real estate crowdfunding deals. The B.C Securities Commission is looking into the legitimacy of these groups and how it may break recently established securities laws in BC.
More info on this story can be found here.
There is also no shortage of conversations regarding the dwindling of neighborhoods as developers are building large homes for many off shore clients. This is leading to new homes sitting empty for the majority of the year and causing unease for many residents of those neighborhoods.
There is no exact data to see exactly what the impact of foreign buyers is on our housing prices but signs are showing that it will continue. With an exceptionally low inventory and low loonie, Vancouver is looking at what could be another year of climbing home prices in our market area.
MARKET OVERVIEW: Residential Detached
Benchmark Price: Estimated sale price of a typical property, based on a set of common qualities of homes within each market.
Price Index (HPI): Index numbers estimate the percentage change in price on typical and constant quality properties over time. All figures are based on past sales.
Supply and demand are the two words to best describe an incredible January. West Vancouver had a staggering increase of 176% in Gross Sales from January 2015 and in one year the Average Price per Unit jumped 58% from $2,289,125 to $3,623,289. With a Benchmark Price increase of 32.2% (from $2,060,600 to $2,756,800) West Vancouver is having a tremendous start to the New Year.
North Vancouver saw a healthy increase in Gross Sales of 22% and their active listings dropped 32% from, 197 to 132. The demand remains high on the North Shore and like in other areas the supply is not keeping up. The Average Price per Unit shot up 22% from $1,423,357 to $1,744,480. Benchmark Price and HPI Price Index for North Vancouver increased 31.4% from the previous year and is $1,376,400 and 219.1 respectively.
Not surprising, Vancouver West had tremendous growth as the Gross Sales increased 86% from one year ago. Gross sales in January of 2015 were at $277,598,488 and as of January 31, 2016 they climbed to $519,062,431. The Average price per Unit also rose 39% from $2,775,984 to $3,873,600 and like other areas the Active Listings dropped from 600 to 464 which was a 22% decrease. This demonstrates again that the demand is outpacing the supply.
Typically home prices dip when the sales to active listings ratio goes below 12%. Home prices increase when ratios reach the low 20% range. The overall sales to active listings ratio for January, 2016 were 38%. This distinctly suggests a seller’s market.
If you are interested in receiving statistics on any other areas let me know. And please forward my newsletter to anyone you feel might benefit from this information.