The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties reached 2,362 in June, a 27.6 per cent decline compared to the 3,262 sales in June 2011 and a 17.2 per cent decline compared to the 2,853 sales in May 2012.
June sales were the lowest total for the month in the region since 2000 and 32.2 per cent below the 10-year June sales average of 3,484.
“Overall conditions have trended in favour of buyers in our marketplace in recent months,” Eugen Klein, REBGV president said. “This means buyers are facing less competition and have more selection to choose from compared to earlier in the year.”
At 18,493, the total number of residential property listings on the MLS® increased 22 per cent from this time last year and increased 3.7 per cent compared to May 2012.
- Sales of detached properties in June 2012 reached 921, a decrease of 37.4 per cent from the 1,471 recorded in June 2011.
- Sales of apartment properties reached 1,026 in June 2012, a 19 per cent decrease compared to the 1,266 sales in June 2011.
- Attached property sales in June 2012 totalled 415, a 21 per cent decrease compared to the 525 sales in June 2011.
Concern For Price Decline
The tightening of credit and new rules for lending will result in the housing market adjusting to the supply and demand for homes in the market. When home prices more than double over the past 8 years, some housing critics are calling for home prices declining in Greater Vancouver by 25% or more.
High supply coupled with buyers staying on the side-line will result in low demand for homes. A vicious cycle of buyers expecting even lower prices over a time period will cause further erosion in home prices.
There is little to suggest the decline in home prices will only last for a couple of years. There is a high possibility that the price decline could be a multi-year decline like what happened in 1994. It took 7 years for the market to reach a bottom.