Happy 2013! With Christmas behind us and the New Year starting to take shape, we'll begin to see a lot more activity in Vancouver Real Estate than what last month brought. As expected, with people celebrating the holidays, many chose to remove their listing from the market and focused their sights on shopping for gifts rather than a new house. This December was no different than others in that the number of listings and sales dropped in every market (except Downtown Vancouver - possibly due to the fact that Downtown serves mostly single people and those without kids who may have more time around the holidays).
December 2012 sales were down 31% from December 2011, and down 32% from November 2012. This ends a year marked by lower than average home activity and modest price drops thanks to a number of factors including the new mortgage rules, lack of great inventory and a general hesitation by both Buyers and Sellers. Keep in mind that activity still varies depending on the area and that the numbers for Active Listings in the charts below were pulled at the beginning of the month - before the typical influx of listings that usually occurs in later January.
Attached homes in Vancouver West had the biggest drop in terms of both listings and sales, where prices remained fairly constant. The Sellers may have been unwilling to drop their prices below their own expectations, leading to a lack of sales. The trend for people buying smaller, less expensive homes continued with high sales for homes less than $500,000 with one or two bedrooms. With Buyer's taking their time in a slower market, it was no surprise that the days on market increased with patient Sellers finally selling their property.
Detached homes in Vancouver West are also trending towards the cheaper market, with homes below the $2-million mark having an average absorption rate of 14%, with the median sales price of everything in the Detached market hovering around $2-million. The sales to active ratio for this market is at a low 5.8% with houses being on market for an average of 72 days.
Sales in Vancouver East dropped significantly last month, with a 41% decline in Attached homes sales and a 17% drop in median sales price (so for half of the 36 sales in December, 18 of them were below $338k). The busiest market in this area was the sub $300k market, and almost no sales above $800k. The one and two bedroom markets dominated, with most people probably looking to the East for an affordable first home, or upgrade to one of the many new condos in the blossoming Main St area.
Detached homes in Vancouver East had 30% less listings and a 37% drop in sales, though prices remained steady in the $800-900k area. With no sales above $1.4-million, this market continues to be the area where people go for entry level detached homes (and with mostly 4 and 5 bedrooms, you can expect many Buyers to be taking advantage of the mortgage helpers and homes in need of some renovations).
Sales activity saw an interesting rise in Downtown last month, with both the number of sales increasing 26% and the number of listings increasing 4% over November. Notice the sharp decline in median price down to $524k from $648k, and the average price down to $646k from $777k. This, along with a high number of listings in the sub $600k market, explain the increase in sales as entry level Buyers were taking advantage of the lower prices while they were available.
Following the trend, listings and sales dropped in North Vancouver, though this area has the highest overall absorption rate in any market at 10.6%. The Attached market remained fairly steady in price, hovering around $500k on average, with most sales being two bedroom units. Notice the change since December 2011, very similar number of listings and sales but the average price has increased 20% and the median has increased 26%, with the Average Price/Sqft dropping 10%. These changes are making the area much more affordable given that the $405/sqft is almost $50 cheaper than the lowest Price/Sqft in Vancouver.
Aside from the expected drop in sales and listings, the Detached market hasn't changed significantly from last month, or last year. The Absorption rate was highest in the $700-800k and the $1-1.2 million market with over 20% of homes selling.
Don't expect listing inventory and sales numbers to stay this low. The Real Estate Market usually picks up in mid-to-late January once everyone heads back into a daily routine. The number of new listings will increase, it's the market segment and quality of the listings that will be interesting - here's hoping they fit what Buyer's have been waiting for! We're also expecting interest rates to rise in the next month or two, as that normally happens around this time of year, so keep that in mind if you want to lock down a good rate.
Now is a great time to get started on a search for your new home. Contact me if you have any questions about a market or area, or if you would like to get an email whenever a new listing matches the criteria you're looking for in a home. I'm happy to help!
All the best in 2013!
Unique Homes Blog
GUIDE TO LANEWAY HOUSES
Go to my blog post for a great, easy to understand guide on Laneway Houses in Vancouver. Like main houses, laneway houses must be located in a defined portion of a lot and are subject to regulations regarding zoning (only RS-1 and RS-5 are allowed), setbacks, fire access, lane access, size, height, parking and tree protection. Together, these siting and design regulations provide a basic template for laneway house design. Like many developments in Vancouver, the application process can be long, but laneway houses are becoming much more common. In order to apply for the approval from the city, you have to do your due diligence beforehand. Read more >>
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