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Compounding Factors Continue to Drive Up Real Estate Prices

Compounding Factors Continue to Drive Up Real Estate Prices

 

The question on everyone’s mind: When will the bubble pop?

 

The Bank of Canada warned on Wednesday about the risk of correction in Vancouver, Toronto and Calgary property markets. Yet, the Greater Vancouver Real Estate Board reported at the beginning of May that bidding wars are more frequent than ever. Property sales this March are the strongest seen in BC since 2007 according to the BC Real Estate Association. Property sales in the entire province jumped 37.6% over last year, and 53.2% in Greater Vancouver alone.

 

Contributing Causes

 

Low interest rates, a diminished Canadian dollar, attractively temperate BC weather, scarcity of vacancy, and fear of price hikes have driven buyers to flock into bidding wars. All types—first-time homeowners, growing families, and foreign purchasers—are buying.

 

There has been a 13.8% decline in listings compounded by an increased demand. On top of that, the sales dollar volume increased from last year by 57.1%, surpassing the overall rate of inflation. The average sale price for all types of homes this past March was $891,000 from $801,000 last year.

 

Left Out

 

These prices resultantly create a housing barrier affecting both low-income and middle class households. Those excluded from the local property market suspect that offshore buyers are hiking up real estate prices, making the property ladder inaccessible to the average homebuyer.

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The data relating to real estate on this website comes in part from the MLS® Reciprocity program of either the Real Estate Board of Greater Vancouver (REBGV), the Fraser Valley Real Estate Board (FVREB) or the Chilliwack and District Real Estate Board (CADREB). Real estate listings held by participating real estate firms are marked with the MLS® logo and detailed information about the listing includes the name of the listing agent. This representation is based in whole or part on data generated by either the REBGV, the FVREB or the CADREB which assumes no responsibility for its accuracy. The materials contained on this page may not be reproduced without the express written consent of either the REBGV, the FVREB or the CADREB.

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