Market Update June 2016

June 11, 2016

The not-too-distant future has come and gone and while we maintain that these conditions can’t persist forever, the market continues to be extremely busy. Truly, the last 6 months have been unprecedented and though it is reasonable to expect a slowdown in pace, it certainly hasn’t happened yet.

 

As usual, let’s start by looking at the numbers. The numbers shown below are a ratio of the number of active listings (at end of month) over the number of sales in that month.

 

Numbers above 7 are considered to be buyers’ markets, below 5 are sellers’ and in-between are considered balanced. Beside the number, I’ve indicated the direction the market moved when compared to the previous month.

 

Months Supply Van West Van East North Van Richmond Burnaby New West
Detached 2.8 Up 2.1 Down 1.6 Up 2.9 Up 2.8 Up 2.0 Up
Attached 1.0 Up 1.4 Up 0.5 Down 1.7 Up 1.2 Down 1.5 Up
Condo 1.2 Down 1.0 Up 0.8 Same 1.6 Down 1.1 Down 1.2 Down

 

It is important to note that while the numbers have moved up/down a bit depending on the category, the actual conditions haven’t changed dramatically. The market continues to be very busy and new record pricing is set on an almost weekly basis. When comparing the actual number of sales in month-over-month comparisons, the number is virtually unchanged. The number of total listings has grown by 3% month-over-month (not enough to really cause a substantial change in market conditions). Anecdotally, the one shift we’ve observed is that an increasing number of sellers have gotten carried away by the “strength of the market” and are asking prices that just don’t make sense for buyers. The market shift we are expecting (and this might be the leading edge of it) will likely be driven by this very phenomenon. As sellers list too high, inventory will grow and thus give buyers a little bit more choice.

 

Until that happens on a more widespread level, let me share with you some of the more crazy recent sales stories. A 780 square foot one bedroom in a 41 year old wood-frame building in the West End was listed for $449,000 and sold for $588,000. Perhaps more interesting is that within 24 hours of each other, 2 2-bedroom condos near Commercial and Hastings in the same 24 year old wood-frame building sold for well over asking. The 773 sf unit originally listed for $499,900 sold for $633,500 and the 784 sf unit originally listed for $498,000 sold for $604,000 (the smaller one had a better view). These two 2-bedroom sales were notable because two months ago, we had seen a record setting sale of an 880sf 2-bedroom unit in a concrete building a block away when that unit had sold for $585,000.

 

To conclude, the market is still ticking along at incredible rates. It won’t last forever, but for now, it’s a great time to be a seller (and an awful time to be a buyer).