A total of 12,560 homes were sold across the province in March, up 38 per cent year-over-year, according to British Columbia Real Estate Association.
B.C. Housing – The housing market in Victoria is enjoying a strong increase in demand as buyers seek alternatives to high-priced Vancouver homes. Greater Victoria is in a seller’s market and sales have jumped 48 per cent in the first quarter of 2016 compared to a year earlier. (Re/Max Data)
The increased demand has added 10 per cent to average home prices though, which reached $543,564 in the first quarter of 2016. This figure shatters the previous record, which was set in May 2007 when 11,683 units were sold in B.C.
“Housing demand has never been stronger in the province,” according to BCREA chief economist Cameron Muir. “Most large population centres of the province are now experiencing record levels of housing demand.”
Muir credits strong employment growth, increasing wages and growing inter-provincial migration into B.C. for the increase.
Demand is so high, inventory levels are now a decade-lows in some areas across the province.
In Vancouver alone, sales increased 28.3 per cent to 5,301 units, compared with 4,132 units last year. The benchmark price increased 22.6 per cent to $1,093,267, compared with $891,652 last year.
“Supply [in Vancouver] simply can’t keep up with demand, be it domestic or foreign, and the sales-to-new listings ratio remains a sky-high 86 per cent,” said BMO Financial Group senior economist Robert Kavcic.
“In other words, almost every new listing is getting absorbed within the month.”
Statistics also predict that the condo market in particular is set to “grow steadily” in the years ahead although the high-end $1 million-plus market is also showing healthy activity.
Kavcic points out that even condo prices—up 19 per cent year-over-year—are increasing at a rate similar to those for detached homes.
Across Canada, home sales increased 12.2 per cent in the 12 months to March and prices were up 15.7 per cent. This growth is due almost entirely to the market strength in Toronto, where prices increased 12.1 per cent and sales grew 15.5 per cent, and Vancouver.
“With supply in the two hot markets extremely tight, prices are likely to push even higher through the always-important spring selling season,” Kavcic said.
“The question is, will policymakers in B.C. and Ontario do anything to quell the fires?”
Kavcic said the data from these two cities is making up for losses in centres in oil-dependent Alberta, most notably Calgary, where home sales fell 11.7 per cent. That city was the only one in Canada to see a drop in prices over the period, although the decrease was small (down 0.5 per cent).