In December, sales of detached homes rose 72% from the previous while the benchmark price went down 4% to $1.423 million.
Home sales in Vancouver almost doubled in December compared to the same period in 2018 as people looking to buy new homes re-entered the market after stricter mortgage rules and efforts to curtail foreign owner rumor, according to the Real Estate Board of Greater Vancouver.
Residential property sales rose by 88% to 2,016 transactions last month compared with 1,072 in the previous year, the board said on Friday. Even so, it was a 19% decrease from the 2,498 sales in Nov.
Vancouver, with a housing market powered by wealthy immigrants from Asia and other parts of the world, has Canada’s highest average home costs. In 2016, British Columbia enacted an additional 15% tax on residential property assignments to foreign buyers in an effort to check demand and galloping home prices. In 2018, Canada’s banking supervisory body imposed so-called stress tests, making it more challenging to get mortgages, especially for first-time buyers.
In 2019, confidence in the housing market was quite instrumental in affecting seasonal patterns, according to board president Ashley Smith. Goings-on were subdued during the usually strong spring period while buyers returned to the market in the second half of the year, she said.
“In the first quarter, many prospective buyers were in a holding pattern, waiting to see how prices would react to the mortgage stress test, new taxes, and other policy changes,” Smith said in a statement. “Confidence started to return in the summer, and we saw above average sales in the final quarter of 2019.”
The number of fresh listings in December increased 13% to 1,588 detached, attached and apartment properties from 1,407 new listings in the previous year, the board said.
Vancouver’s housing market was still recovering in 2019 as the year’s overall sales of 25,351 was 20% below the 10-year sales average and 30% below the 2017 total, according to the board. Nonetheless, it was 3% better than 2018, it said.
The ratio of sales to active listings, which can be a sign of the direction of housing prices, was 23% for all housing types in December. If the number falls below 12% over a long period, home prices tend to drop. A ratio above 20% for many months puts pressure on prices to increase, according to the board.
By property type in December, the ratio was 26% for townhomes, 15% for detached homes, and 33% for apartments, the board said.