Ryan Berlin: Usually, the heat of summer is when the housing market cools down. Once again, 2021 and Metro Vancouver's real estate market are defying trends.
In a typical year for our housing market, the dog days of summer are characterized by predictably higher inventory levels and modest sales activity. It makes sense, too: usually, a smaller contingent of us are concerned with buying and selling homes at a time of year when we could be camping, hanging out on patios with friends, or catching a Canadians baseball game.
However–and you knew this was coming–this has been anything but a typical year for our market (and our economy…and everything).
Let’s start with a conversation about housing supply. A critical issue at the best of times, the past couple of months have seen MLS listings dive to historic lows across the Vancouver Region.
In August, the 12,871 homes available for purchase were down 36% from last August’s level, and were 40% below the past-decade average for the month. In fact, August’s listings were down by a whopping 16% (!) compared to July’s inventory level, a reality made all the more startling by the fact that in a typical year inventory only dips by 2% between July and August.
The atypical seasonal changes observed on the supply side of the market also apply to the demand side, albeit to a slightly lesser extent.
On the one hand, the direction of change in sales activity through the summer (that is, a slowdown) transpired as expected: indeed, the 5,137 MLS sales tallied in the Vancouver Region in August was down 2% from July and represented the 5th straight month of declining sales counts (following the almost-9,000 sales apex we ascended to in March). For those working and participating in the real estate market, the declining sales activity has been palpable.
Of course, there are two sides to every coin. Yes, the 5,137 sales are the lowest count in 8 months, but they are still up 3% from last August’s level, and 30% higher than past-decade August average. In fact, August wrapped a 12-month period that saw the region register 72,360 sales–the most in any 12-month period in our history. (All of this despite–or because of–a pandemic.)
So where do we go from here? While sellers’ markets abound throughout the Vancouver Region and across home types, September is typically characterized by a rise in new listings and, by extension, housing inventory, along with a dip in sales (as much as you’d like to go to that open house you probably should pick the kids up from school).
But with “atypical” being the zeitgeist of our market, perhaps we should expect the unexpected.
Ryan Berlin is the Senior Economist with rennie intelligence.
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