In recent months, the Vancouver real estate market has experienced a resurgence in sales, particularly in the condo and house segments. According to statistics, the condo market saw a 45% increase in sales from January to February, followed by an impressive 51% jump from February to March. Meanwhile, the house market remained balanced in the first month but picked up pace in the following months, with a 45% increase in sales from February to March.
The increase in sales is an encouraging sign for the real estate market, and the statistics suggest that demand for properties is still strong. While the Vancouver real estate market has seen its fair share of ups and downs, this recent increase in sales has been attributed to several factors, including low interest rates and a strong labor market.
The interest rates, which have been held by the Bank of Canada again today, makes for a more psychologically comfortable environment for people to borrow in. The theory now is that rates will be held and slowly reduce as time goes up. But the direct tightening cycle (raising of rates) is now over.
This has made the Vancouver real estate market more appealing again, particularly to first-time homebuyers. The strong labor market has also played a role in this resurgence, as more people are employed and earning wages that can be used to finance home purchases. Another important factor to consider is that rates are not expected to drop this year. This means that potential homebuyers will have to contend with current interest rates when financing their purchases. And though they may have better peace of mind that rates will hopefully no longer be on the rise, they are still not cheap.
It is also worth noting that the labor market is still above maximum sustainable employment. This means that there are more people employed than is sustainable in the long run, which can put pressure on wages and inflation. For inflation to move down, the unemployment rate will have to move up, says the bank of canada.Looking at the listing side, the Vancouver condo market saw a 5% decrease in listings from January to February, followed by a 37% increase from February to March. Meanwhile, the house market saw a 15% increase in listings from January to February and a 20% increase from February to March.
The increase in condo listings from February to March suggests that more people are putting their condos on the market, perhaps in response to the increase in demand. In conclusion, the recent resurgence in the Vancouver real estate market is an encouraging sign for the city's Buyers and sellers. Paused interest rates and a strong labor market have contributed to an increase in sales, particularly in the condo and house markets. However, policymakers and potential homebuyers should keep an eye on wage growth and inflation, as well as the potential impact of current interest rates on the market.