In the final month of 2022, Vancouver suffered the effects of the winter market that have been seen widely across Canada – a cooldown in sales numbers. There were 1,295 sales in the Greater Vancouver area in December, down 19.8% month-over-month, according to the Real Estate Board of Greater Vancouver (REBGV).
The Cool Winter Market Turns Colder With Yet Another Interest Rate Hike
Buyer apprehension in December was compounded by the interest rate hikes from the Bank of Canada. After the seventh rate hike announcement in early December, homes have traded hands at even slower rates than expected. Sales numbers were 37.7% below the 10-year December sales average. Sales of detached homes fell by 23.6% to 371, while attached homes and condo apartments fell by 20.9% to 222 and 17.1% to 702, respectively.
Sellers are just as hesitant to enter the market which is affecting already dwindling inventory levels. While there were 3,055 homes listed for sale in November, that number fell by 60.5% to 1,206 in December. Condo apartments suffered the most significant decline in new listings month-over-month, dropping 62.7% from 1616 to 602.
2022 Figures Reflect the Apprehension of Prospective Buyers and Sellers
Despite Greater Vancouver hitting a record high for home prices early in the year, the story of 2022 has mainly been about the cost of borrowing and the impact on real estate in the area. Sales numbers have declined throughout the year, with the final figure of 28,903 being 34.3% lower than the 43,999 sales in 2021. With such a low interest rate throughout 2021, it’s no surprise that sales numbers have fallen so much.
Listings also remained below 2021 numbers throughout the year. There was a total of 53,865 homes listed throughout 2022, down 13.5% from 2021’s total of 62,265 homes. This is likely due to cooling buyer interest as the year went on, with many potential buyers riding the sidelines to see how rate hikes would unfold, and sellers less inclined to list their homes due to diminishing demand compared to the previous year, or even from the 2022 peak.
Home prices have taken a hit during the year as buyer interest and competition has dwindled, with the benchmark price in Vancouver, $1,143,300, being 9.3% lower than it was six months ago. “Closing out 2022, the data show that the Bank of Canada’s decisions to increase the policy rate at seven of the eight interest rate announcement dates in 2022 has translated into downward pressure on home sale activity and, to a lesser extent, home prices in Metro Vancouver,” said Andrew Lis, REBGV director.
Some Gains Experienced in Greater Vancouver Region
While the majority of markets are below the December 2021 price now, there are a few that still have a higher average. New Westminster experienced price gains of 1.4% year-over-year, now at $781,400. Port Moody followed suit, with price gains of 1.1%, while average prices in the Sunshine Coast and Richmond grew by 0.6% and 0.3% respectively.
West Vancouver has had a 39.3% jump in sales in contrast to the overall number, with 39 transactions completed throughout December. The number of new listings have fallen almost completely across the board, with only apartments in Whistler/Pemberton and attached homes in Delta expericing a growth in inventory of 27.8% and 80%, respectively.
The December market may have cooled in the Greater Vancouver region, but that doesn’t mean 2023 won’t be a great time to buy. Ready to make your move and find your perfect home? Give us a call today to speak to a local real estate agent and down our free Buyer’s and Seller’s Guides to get you started.