The beauty of any city is well seen by how people would love to work and live there. Vancouver is one of the cities in Canada where the population is increasing and is ranked at the top as the most populous city in British Columbia province. The main reason behind this great milestone is the home prices that are very high. In March/April 2019, buyers might get their opportunity since the Prices are subsiding and listing growing. The rise of interest rates and mortgage stress test rules are believed to causing the flat sales and price decrease lately. This is a waiting game for almost every Canadian housing markets and hence the lowest prices expected to come in March/April.
Forget gold, “invest in Vancouver real estate” is the message from the world’s biggest asset manager, Laurence D. Fink. Despite the craziness of Vancouver real estate, what is the actual ROI these days base on rental income? We all agree that the housing price is not going to be uplifting as fast as was it was 3 years ago. Many people are not in rush to sale or to buy a property. Instead, people a holding them and renting the units out.
1 & 2 bedroom condo has always been a popular option to purchase and rent due to high demands. Let’s look at the overall ROI in the major cities in Greater Vancouver.
The city of Vancouver belongs to the Greater Vancouver Regional District. This dynamic city has the qualities of a port city and the charm of the Canadian mountains. It is impossible to talk only about the city of Vancouver, not to mention the surrounding districts such as West Vancouver, Richmond or Surrey to mention but a few. Living in Vancouver means living in one of the most cosmopolitan andhighest-quality cities in the world. All this raised it to the highest standards in real estate development worldwide and therefore housing prices are stratospheric. The reasons that real estate prices are so crazy:
The supply of homes for sale in Metro Vancouver is rising but residential home sales in the region fell by 37.7 per cent in June. According to a report recently released by the Real Estate Board of Greater Vancouver (REBGV), home sales were 28.7 per cent below the 10-year June sales average thanks to stubbornly high prices even as more houses were added to the market.
“Prices are slow to adjust,” said Tom Davidoff, real estate economist with the University of British Columbia’s Sauder School of Business. “The price momentum has certainly slowed and there is reason to think you will see a further softening of the market going forward. Before prices fall, you tend to see sales activity fall first.”
Higher prices, rising rates, new tax announcements, and latest mortgage requirements are all playing important factors towards the plummeting of housing sales in the Metro Vancouver area. As housing sales dipped to the lowest level in the recent years, Metro Vancouver’s new homes have soared in the initial quarter of the year, with stats in Vancouver alone being more than twice as high as the same period in 2017. There were 6,542 home sales on the Multiple Listing Service (MLS) in Metro Vancouver during the initial quarter of 2018, which is a decrease of 13.1 percent from the same period last year. This represents the region’s lowest first-quarter sales total since 2013, reported by the Real Estate Board of Greater Vancouver (REBGV).
A Comparative Analysis
The overall housing sales in the first quarter of the year were the lowest in the past 5 years. In fact, even the local listings of detached, attached and apartment properties dropped by almost 7 percent in March as compared to previous year. But total housing stats across the region increased to 6,864 units in the first three months of 2018, up by 30 percent from the last year. Massive increments were also noticed in the Northern Vancouver area, where about 1,422 new homes were initiated, comparable to only 107 in the same period the preceding year. Even though there have been almost 43,000 new homes under construction across the Metro Vancouver area, the current inventory remains incredibly low.
Housing Price Benchmark Reaching Astonishing New Heights
Sales have started to outstrip supply for condos and townhouses. The benchmark price for a condo was close to $700,000 in March. This is a leap of 26% compared to the preceding year. Standard townhouse prices across Metro Vancouver reached $835,300 last month, which is a 2 % hike over February and an overall 18% rise from March 2017.
Renters are paying the real price when it comes to living in these highly expensive areas. According to the Canada Mortgage and Housing Corporation, average rent has nationally gone up previous year by 2.7 percent to $947 per month. Meanwhile, rental property is becoming tougher and tougher to avail. The CMHC says that the overall vacancy rate for cities across the country was three percent in 2017, down from 3.7 percent in 2016. In its annual report on housing rentals, the corporation said the demand for a purpose-built apartment is outpacing the growth in supply, while the rates of condos rented out are also declining.
This uncontrollable price outburst has taken the market by surprise. This is becoming a serious concern for both businesses and residents looking to recruit new candidates. It is becoming immensely cumbersome to buy quality real estate in Vancouver. The government of British Columbia is looking to follow new measures intended to mitigate the highly inflammable housing costs.
Increasing construction can meet the rising demand for rental studios and multi-family homes. Beyond that, it wouldn’t hurt for people to look for suitable accommodations adjacent to or on the outskirts of the Metro Vancouver area!
“Vancouver is expensive to live” has been ring our ears for a while. We have the most expensive gas in North America (gas prices spike to $1.50CAD/Litre) , as well as high cost on housings..etc. On the other hand, we also believe that Vancouver is “very international” as we have
hosted at least one Olympic event (2010 Winter Olympics)
lots of new immigrants & speaks over 200 languages
The’s a cost for being a “popular” city so it is expensive to live in! However, how “expensive” is Vancouver compare to other popular ones? Let’s have a look at cost of living compared with other well-known cities around the world. Looks like we are not too bad!
Please include attribution to Condos in Yaletown with this graphic.
2016 – A Year of Ups & Downs for Vancouver Real Estate
At the start of 2016, Metro Vancouver had been a real estate Eldorado, witnessing record-smashing numbers in housing sales and listings. With every passing month since early spring, housing numbers continued the trend of dwarfing the preceding months’ and years’ records. Yaletown was no exception to this, being one of Metro Vancouver’s most desired locations to live in.
A significant contribution to this trend in Metro Vancouver was the investment by foreign buyers, both businessmen and immigrants, in one of Canada’s fastest-growing metros. 2016, particularly, saw a huge surge in the number of foreigners that were migrating to the city. The Metro Vancouver real estate was booming and was at its peak. But so were the prices of listings. Housing rates were at its all-time highest, and it was beginning to concern the city’s officials.
What followed was entirely unprecedented. As expected, the number of sales naturally dropped down drastically in the same month that the levy was implemented. But, in a surprising turn of events, the average housing rates did not budge at all. In fact, many areas including Yaletown, saw housing prices go up despite the fact that there was a lower demand.
Despite these rough waves that have been hitting Vancouver recently, many experts believe that Vancouver’s real estate will continue to remain healthy. A forecast by Central 1 Credit Union predicts B.C.’s hot real estate market will remain healthy for the next two years. Senior economist, Brian Yu believes that slower growth is healthier for the market because sky-rocketing Greater Vancouver prices seen during what he described as “spring fever” were unsustainable, in the early part of 2016.
A Healthier Future for Yaletown
At the hub of Metro Vancouver’s Downtown area, and situated in one of its prime locations, is Yaletown. Its distinct location makes Yaletown one of the most desirable places to live in the city. This automatically results in a higher demand for housing, and ultimately, makes the area one of Vancouver’s most expensive.
Given the recent fluctuating situation and rough sailing real estate boat of Metro Vancouver, Yaletown has been at the thick and thin of it all. With every crest and trough that the city has undergone, it has been directly reflected on Yaletown too.
As the number of listings continues to stack up, the number of housing sales has failed to show any signs of picking up pace anytime soon. Despite this, the rates of listings have not eased. On the contrary, it has gone up over the past couple of months.
Average housing prices currently, at an average, stands at $1,538,349, including detached and attached homes, and apartments. The highest price stands at over a staggering $8 million.
Despite all the inflation within Yaletown’s property prices, Yu’s prediction indicates a promising and healthy future for Yaletown. The popularity of the prime Vancouver region is expected to remain positive.