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Business activity in Metro Vancouver has slowed in recent months.
According to data from the Real Estate Board of Greater Vancouver (REBGV), home sales in Metro Vancouver peaked at 1,887 in July 2022, down more than 40% year over year and down 22.85% from the previous month.
Along with the commercial activity, prices also fell. From July 2021 to July 2022, average prices decreased by around 10% for all property types.
After two and a half years of unprecedented growth, this slowdown in the housing market is the result of several factors: record inflation, rising interest rates and general uncertainty in the stock market.
However, despite this uncertainty, Kevin O’Toole, Chief Broker at Sotheby’s International Realty Canadaremains optimistic about the future.
O’Toole has been in the industry for twenty years and has had his fair share of ups and downs. According to him, this current cooling has been relatively mild compared to past corrections it has experienced.
For example, in 2008, prices fell about 20% at the height of the global financial crisis. And even then, the Vancouver real estate market was quick to rebound once buyers realized that Vancouver and Canada as a whole were not struggling with the same problems as the United States.
But according to O’Toole, it’s a bit too early to tell where the market is headed. We will know better where things stand next September, when the Bank of Canada announces its next rate hike.
READ: Vancouver housing market embraces change, braces for fall rebound
“Right now, we think the next rate hike will be around half a point to three-quarters of a point,” O’Toole shares, “but some people are predicting another full one-point hike, and if that occurs, it could cause a [further] market downturn.
But O’Toole points out that the biggest market downturn may already be behind us, as current selling activity is below the 10-year average.
The silver lining of all this uncertainty? Since condos have seen a much smaller decline than single-family homes, now may be the time for suite owners to expand.
“Over the past two years, home prices in Greater Vancouver have gone up much faster than condominiums and townhouses,” says O’Toole. “Now, single-detached home prices are falling, while condos and townhouses are holding their value.”
“People who have built a lot of equity in their [condos] might be able to buy a bigger house or upgrade to something that might have been unobtainable six months ago.
But this sweet spot in the market may not last long. According to O’Toole, activity has already started to pick up over the past two weeks as summer draws to a close, children return to school and people make more and more plans for the future. ‘coming.
Only time will tell how the next few months unfold and where the market will be by the end of the year.
This article was produced in partnership with STOREYS Custom Studio.
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