A divergent trend has begun to establish itself in the Greater Vancouver Condo Market. Beginning in June 2019 prices were at $643,471 which bounced off our technical line and began a minor uptrend that propelled the market higher peaking in September 2019 with prices reaching $673,220. The November data produced and average sales price of $670,811 indicating a lower high than the previous high in September. This trend will be resolved with a clear and concise winner, Eitel Insights anticipates seeing the Greater Vancouver Condo average sales prices take another leg lower in 2020 and beyond.
Overall the market is down 11% from the peak in 2018, and while year over year is only down 3% that is after this recent rally that began when prices were down close to 7% from the November 2018 sales price.
Sales numbers have been touted as a sign of strength by the Real Estate Board, however the chart above in our opinion does not share their sentiment. Yes, November sales are up 400 year over year. However they conveniently don’t mention that last year was one of the worst on record. Sales will not dissipate to nothing there is always a segment of demand in Greater Vancouver. Need based purchasers, however we anticipate the inventory will drastically jump higher over the upcoming two years and that will disarm any potential rebound believed to be occurring by optimists.
The inventory has seemingly taken the 4th quarter of 2019 off, after realizing an aggressive growth trend for the past 2 years. However the new monthly listed inventory is only lower by 300 properties on a year over year basis, and the overall inventory is lower by 800 properties. We attribute this to fatigue on part of sellers that haven’t been able to achieve a sales after remaining on the market for a lengthy period of time and simply removing the listing for the Holiday Season.
Eitel Insights sees a great imbalance currently taking hold in the Condo Market. As evidenced by the chart below which is the average days on market. Currently to achieve a property takes on average 44 days which is continually climbing higher. Indicating a real imbalance of “listed properties” versus “sellable properties”.
I will leave you with this analogy for the Greater Vancouver Condo market. Picking yourself up off the floor doesn’t mean you will win the fight. Again Real Estate cycles exist, we point out where we are in any given cycle across Canada. Here in Vancouver the market still needs to go lower before the cycle has been filled and the market can again see prices increase. For an individual report please visit www.eitelinsights.com
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