Welcome to the November 2024 Metro Vancouver Real Estate Market Update. While the reported 28% year-over-year increase in sales might suggest a strong market, if you look into the 10-year averages it reveals a more balanced landscape.
The sales were 12.8% below the 10-year average. It was 5.5% below last month, so the sales actually slowed down a bit. Similarly, the new listings were 5.4% above the 10-year average while it was 20% above the month before. This reduction in new listing balanced out the slower sales. As a result, the total inventory is 26.1% above the 10-year , almost unchanged from last month’s 26.2%.
Sales-to-active listings ratios, which measure supply and demand, saw little change. Ratios between 12% and 20% indicate a balanced market, while higher percentages signal upward pricing pressure. Ratios below 12% suggest a weaker market.
This month the sales-to-active listings ratio for detached and apartments went down, signalling a weaker environment and you can see that the month over month price decrease for these two categories. Townhomes were the opposite. The ratio went up as well as the month over month price increase. Is this a reflection of the unaffordability of detached homes and an oversupply of condos?
It is widely expected the Bank of Canada will cut rates this week. It is a toss up between 0.25% and 0.50%. Then possibly another 1.0% through 2025. While these cuts will directly impact variable-rate mortgages, fixed-rate mortgages are expected to remain relatively stable. (See graph for details.)
Projections of the economy and the rate environment are difficult at the best of times. With the new administration coming into office in the New Year in the U.S., this task has become exponentially more difficult.
For now, let’s set those worries aside and focus on family and friends. Enjoy the holiday season, and have a wonderful New Year!
John
