Weak sales cause average 2017 price of Vancouver detached homes to tumble 6.5%
With 2017 behind us, for the first time in a decade, so may be some of the highest housing prices.
Real estate agent and industry blogger Steve Saretsky says the average price of detached homes in Vancouver fell 6.5 per cent last year.
Most of the price movement was at the higher end of the market, he said in his article, Vancouver Real Estate in Review 2017.
Saretsky says single family home sales have been soft for about 18 months.
"I think with those weak sales, it has allowed inventory to creep up and that's put a damper on prices," said Saretsky.
Overseas money coming into the Vancouver real estate market has dropped off significantly, he said.
As well, there has been the implementation of a foreign buyers tax and new mortgage rules.
"I think the impact is obviously pretty noticeable," said Saretsky.
All of this, he said, has many people opting to put their money in smaller investments like condominiums.
As a result, he said, the condo market is in an opposite situation with inventory levels going down and prices going up.
Saretsky feels it's a good time for people who want to climb the property ladder.
"If you're looking to jump from a condo to a single family house, the price gap has never been this narrow," said Saretsky.
In its assessment of the 2017 market, the Real Estate Board of Greater Vancouver reports sales were steady and listings diminished for more historically normal levels in the housing sector.
"The detached home market operated in a more balanced state, giving homebuyers more selection to choose from and more time to make decisions," said REBGV president Jill Oudil.
In 2017, there were 2,434 single family home sales in Vancouver.
That's the lowest since 2,281 sales in 2008 and well off the peak of 3,946 sales in 2015.
UBC Sauder School of Business real estate expert Tom Davidoff says it's hard to know, especially in a market like Vancouver, where prices and sales will be a year from now.
"But the slow sales pace for single family isn't particularly encouraging for that segment. And it would be amazing if condos had a strong a year this coming year, as they did last year," said Davidoff.
Saretsky, however, expects Vancouver home prices will continue to drop but stops short of saying the bubble has burst.
"I don't want to be the guy to call it, but it's definitely a change in direction.
"It'll be very interesting to see how this year shapes up."
