May 2018 Vancouver Real Estate Market update!

The numbers are in for the Greater Vancouver. I want to talk about what happened in May and what happened in May of last year. Are we ahead? Are we behind? Also I want to look into what’s going on with the month of inventory in March, April and May of this year. Is the month of inventory going up or going down? What’s happening in the detached and attached markets. Let’s have a look at the numbers: If we look at May 2018 there were 2,833 sales opposed to 4,364 May of last year, so they are down by 35%. There are few reasons for that. First reason, we have had some mortgage rate increases this year. Second reason, the government introduced new stress testing for conventional mortgages. Third reason, the change of the Provincial Government last year has created uncertainty with many proposed new rules, taxes and announcements. For example, 1. Increase Foreign Buyers Tax from 15% to 20% 2. Property transfer Taxes also increased for purchases over 3 million dollars 3. The proposed school levy on properties over 3 million dollars! 4. Introduction of Speculation Tax and Empty Home Tax Back to the numbers. Active listings 11,292 at the end of May this year and 8,168 last year, listings are up by 38 %. But here is a big number that I like to look at is a Month of Inventory. A Month of Inventory is 4 months in the month of May for 2018 opposed to 1,9 and that’s what we had last year. Lets look into Mach, April and May. You can see we had roughly 2,517 sales in March, 2,579 in April and over 2,833 in May. The market is started to pick up a little bit during the spring market. And lets look into month of Inventory . We had 3,3 in March, 3,8 in April and 4 in the month of May. The month of inventory is starting to creep up, which is again normal in spring market. So sales are off by 35%, big number, there is no question, but if you look at the month of inventory you are still in a healthy market. But what is selling and what is not selling? If you look at detached properties we have 926 sales opposed active listings of 6,610. It means we have 7 months of inventory. And the condos 2,4 months of inventory and townhouses 2,7. And the market overall is 4 months of inventory. Obviously, what’s selling? Condos are selling, townhouses are selling. But what’s getting hit is the detached properties. And let’s face it the more expensive the detached property, the more months of inventory you are going to have. So, what should you be considering? Let’s think about this! If you have condo that has say 2,4 months of inventory, which way the prices are going in condo? They are going up, there is no question! 2,4 months of inventory is a very strong market because affordability is a problem in Vancouver. A lot of people can only afford to buy a condominium apartment. So of cause they gonna start to buy those, there will be more buyers out there. Less inventory, prices raise, you probably still will see multiple offers. Detached!!! 7 months of inventory! What do you think is happening with expensive detached properties right now? Prices going up or prices going down? Prices are going down. They are weakening. Go to North Shore! What’s happening in West Vancouver? Probably operating with 17 months of inventory! So what’s going on over there? Prices are softening. But think about this. If you own a condo and if your condo is in a strong market and it is going up in price, and let’s see detached properties are coming down in price. What’s starting to happen to the price gap? The gap is getting smaller. So now, possibly you may afford to move from a condo to a house. It maybe something to consider! If you are a seller in this market, one out of 7 properties are going to sell this month. So how do you become the one? So what are you dealing with right now? You are dealing with huge competition and beauty contest. You have to be the best price, you have to show the best and most important you need a creative marketing plan and experienced realtor! If you are looking to purchase a condo it’s important to make sure that you have your financing in order, consider doing inspection and reviewing strata documents prior placing an offer! And of cause work with the experienced realtor who will help to navigate you through this not easy buying process. Anyway, give me a call! I would love to help you!