Vancouver’s real estate market saw a significant decline in home sales during the month of May, with a nearly 20 per cent drop compared to the previous year. This decrease in sales can be attributed to the continuous rise in inventory levels.
According to the latest data from the Real Estate Board of Greater Vancouver (REBGV), a total of 2,833 homes were sold in May 2021, marking a 19.3 per cent decrease from the 3,524 homes sold in May 2020. This also represents a 13.8 per cent decrease from the 3,209 homes sold in April 2021.
The decline in home sales can be attributed to the ongoing increase in inventory levels. The REBGV reported a total of 11,362 homes for sale in May 2021, a 7.1 per cent increase from the 10,582 homes listed in May 2020. This also marks a 2.1 per cent increase from the 11,083 homes listed in April 2021.
The increase in inventory levels can be attributed to a combination of factors, including the impact of the COVID-19 pandemic on the economy and the recent implementation of the new mortgage stress test. These factors have led to a decrease in demand for homes, resulting in a surplus of inventory.
Despite the decrease in home sales, the REBGV reports that the benchmark price for all residential properties in Metro Vancouver is still on the rise. The benchmark price, which represents a typical property within each market, reached $1,172,800 in May 2021, a 14 per cent increase from May 2020 and a 1.5 per cent increase from April 2021.
In terms of specific property types, the benchmark price for detached homes in Metro Vancouver reached $1,800,600 in May 2021, a 22.8 per cent increase from May 2020 and a 1.7 per cent increase from April 2021. The benchmark price for townhomes also saw a significant increase, reaching $936,300 in May 2021, a 17.7 per cent increase from May 2020 and a 1.4 per cent increase from April 2021.
Despite the current market conditions, the REBGV remains optimistic about the future of Vancouver’s real estate market. “While home sale and listing activity remained above our long-term averages in May, conditions moved back from the record-setting pace experienced throughout Metro Vancouver in March and April of this year,” said Keith Stewart, REBGV economist.
As the economy continues to recover and restrictions ease, it is expected that the demand for homes will increase, potentially leading to a more balanced market in the future. However, for now, the Vancouver real estate market remains in a state of flux, with home sales declining and inventory levels on the rise.
