August 2019 Westside Market Update

The supply of Westside detached homes in August was 661, down 5% from 697 in July and down 14% compared to 765 in August 2018. 
Westside detached home sales this August decreased 28% from July (56 v 78) and were up 2% compared to 55 sales in August 2018. Sales are down 43% from the 10 year August average of 98 sales. 
Months of Supply, (MOS) was up 32% from last month to 11.8 and down 15% from 13.9 in August 2018. (Usually a balanced market is in the range between 4-7 MOS with prices rising below 4 MOS and falling above 7 MOS). The average detached home price remained unchanged at  $3.39M and the median price decreased 5% to $2.864M. If demand stays low, MOS will stay high and that usually creates downward pressure on prices. Current prices are still down 26% on average & on median from the peak in Oct 2017.
The highest sale price for a Westside detached home in August was $12M. It was on the market for 55 days before it sold. The lowest price was $1.6M. It was on the market for 138 days before it sold. Of the 56 August sales, 4 received the asking price or more and 52 sold below the asking price. 
Westside apartment supply decreased 11% in August (1368 v. 1542) but this is up 22% from the 1126 listings we had in August 2018. At the same time, demand decreased 11% 314 sales v. 353 sales in July) and this is up 14% from 275 sales in August 2018.
The result is MOS in August is unchanged from the 4.4 in July and up 6% from 4.1 last August 2018.
The average price decreased 1% to $864K in August v. $877K in July and was down 12% from August 2018. The median price remained relatively unchanged at $756K v  $750K in July and is down 5% from last August. Average and median prices are down by 28% & 14% from the peak of $1.199M and $880K in January 2018.

Westside townhouse supply decreased 11% this August (280 v. 314) from July but that's up 16% from 241 in August 2018. Demand in August is down 18% to 46 sales from 56 in July and up from 38 sales last August 2018.
With supply and demand down, current MOS increased to 6.1 from 5.6 in July. That is a decrease of 4% from 6.3 in August 2018.
Townhouse average prices were up 8.5% in August ($1.39M) and were down 7% from $1.5M last August 2018. Median prices increased 12% to $1.32M from $1.18M in July and are down 8% from $1.45M in August 2018. Both average and median prices are down by 22% & 13% from the peak of $1.8M and $1.5M in January 2018.

Detached, Attached and Apartments on the west side are still  priced well below the peak and that is creating good buying opportunities. Detached home prices have been creeping up since Feb. this year and are now 13 & 5% higher on average & median. Many house buyers continue holding off in anticipation of further declines in 2019 but prices appear to be up from February. 
The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in the region increased 15.7% to 2231 this August from 1,929 sales in August 2018. August sales were 9.2% below the 10-year August sales average.
The total number of properties currently offered on the MLS® system in Metro Vancouver is up 13.3% from August 2018 to 13,396. This is down 5.9% from last month.
For all property types, the sales-to-active listings ratio for August 2019 is 16.7%.
Downward pressure on home prices occurs when the ratio dips below the 12% mark for a sustained period, while upward pressure occurs when it surpasses 20% over several months.

There continues to be a gap in expectations between the buyers and sellers as many sellers do not need to sell and are loath to do so at what they perceive to be a low price while buyers are waiting for prices to soften more. The lower volume of sales may be the new reality for demand and supply in Vancouver with foreign buyer taxes and other local taxes eating into homeowners equity and making it harder to own real estate. The new assessed values may help sellers see the new pricing reality and encourage buyers to get offers on paper at these discounted prices.
Government policy continues to hinder home sales activity. The federal governments mortgage stress test has reduced buyer's purchasing power by about 20%, which is causing entry level buyers to struggle to secure financing. Suppressing home sales through government policy not only reduces the number of sales, it also harms the job market, decreases economic growth and creates pent up demand all of which are negative outcomes and contrary to the stated goal of creating affordable housing.

Please call me at any time for a considered response to any and all of your real estate questions.

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