Assessing Vancouver’s Townhouse Market in May
When it comes to real estate, Vancouver has been in the news—a lot. But while the price tag per square foot on high end detached homes has certainly slid, trends assessing Vancouver’s townhouse and condo market show stability.
According to the Knight Frank Prime Global Cities Index, which monitors price growth of the top five percent of the housing market in 43 cities, prices in the top end of residential real estate in the city have dropped 7.6 percent over a six-month period to March. This makes Vancouver the second-worst performer during that period among global cities.
In April, the benchmark price for a single-family detached home in the west side, where Vancouver’s most expensive homes are located, was $3.4 million, a six percent drop over a six-month period.
However, local marketing research firm Snap Stats showed that from March to April, townhouse prices in downtown Vancouver, East Vancouver, and North Vancouver remained unchanged. In fact, prices actually increased in the West Side (7%), and West Vancouver (13%).
“As an early indicator, it’s a positive indicator about how these properties will weather market changes,” says townhouse realtor Ariane Benjamin of vancouvertownhouse.ca. “As relatively affordable properties, there’s still a lot of interest in townhouses and condos.”
April saw more inventory in the detached home market but fewer sales. There are approximately 1,800 properties over $3 million currently for sale in the region, with 262 sold between January 1 to April 30—less than half of the 561 homes sold during the same time period in 2017. In other words, there a lot more supply, which means buyers have room to negotiate.
Factors driving the price drop include the new mortgage stress test, hikes on the foreign-buyers tax, and the property transfer tax.
“It’s still not certain how all these factors will play out,” says Ariane. “Ups and downs are just part of the real estate cycle. But for now, short-term trends assessing Vancouver’s townhouse market indicate these properties will retain value better than the detached market.”