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WATCH: Bad news for anyone hoping the Metro Vancouver housing bubble would burst. The price of a home in Greater Vancouver is up 12 per cent year-over-year. Grace Ke reports.

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Just when prospective homebuyers thought they might find some relief in Metro Vancouver’s real estate market, a new report suggests that while the foreign home buyer tax may have cooled the housing market temporarily, people are now starting to rush back in.

Royal LePage CEO Phil Soper says sales plunged and price increases slowed in a housing correction that began seven months ago — around the time B.C. introduced a 15 per cent tax on foreign buyers.

READ MORE: City of Vancouver looks to ‘reset’ housing strategy to better address affordability crunch

“Vancouver house prices are up compared to the first quarter of 2016, yet this doesn’t tell the complete story,” Soper said. “For weeks now, we have witnessed a steady fall in real estate values in the Lower Mainland, with sales activity down some 40 per cent compared to recent norms.”

But he said in the past month, sales in the Vancouver area have jumped by close to 50 per cent on a month-over-month basis — better than the seasonal average.

“Someone [cried] ‘wolf’ and there really [aren’t] that many Chinese buyers here after all,” Soper said. “It’s about five per cent of the overall market so now they are going to rush back in.”

READ MORE: Strong demand helps Vancouver real estate rebound

Soper said it’s possible that six months of pent-up demand will be unleashed on the market in the coming weeks, sending prices sharply upward again.

“An unfortunate side effect of heavy-handed regulatory intervention is that we risk market whiplash,” he said.

Local Royal LePage realtor Adil Dinani said he is seeing signs of a market rebound.

“In the city of Vancouver, four to five out of 10 properties that I have been involved with on the listing side have gone into a multiple-offer situation, so we are seeing that become commonplace again.”

READ MORE: City of Vancouver looks to ‘reset’ housing strategy to better address affordability crunch

According to the Royal LePage quarterly report, home prices in Metro Vancouver slowed considerably in the beginning of the year.

In the first quarter of this year, the aggregate price of a home in Greater Vancouver increased 12.3 per cent year-over-year, compared to a 25.6 year-over-year increase in the fourth quarter of last year.

Langley showed the greatest growth, rising 21 per cent year-over-year to $794,000. Surrey is still the most affordable city with prices climbing 15 per cent to $763,000. In the city of Vancouver, prices rose 10 per cent to $1.4 million.

“We are seeing robust buyer demand, especially in condominium market. If that scenario continues then we’re probably going to see upward pressure on prices,” Dinani said.

— With files from Grace Ke and The Canadian Press

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