The impact of last year’s foreign buyer’s tax seems to be wearing off in the always-interesting Vancouver housing market. The most expensive city for real estate is now seeing demand for homes and sales of property is likely to increase.
The swing in demand was noted in condominiums and townhouses in the month of April, while sales of all property types fell 26 percent in April it is still above the 10 year average for the month.
Experts familiar with the matter said the market was now operating below the record levels it saw last year but are still in line with average historical levels. They also said demand in the condo and town house market has been increasing for months and availability of homes was not on par. This is leading to price increases and bidding wars.
Prices for the condo and townhouse market are expected to increase steadily as the impact of the tax wears off.
“Until more entry level, or missing middle, homes are available for sale in our market, we’ll likely continue to see prices increase,” experts said. “There’s been record building this past year, but much of that inventory isn’t ready to hit the market.”
Vancouver’s 15 percent taxation on foreign buyers had earlier led to a decline in sales and was even adopted by Ontario which named their version the non-resident tax. Vancouver which was seeing huge demand and was named one of the ‘hottest’ real estate markets saw the huge increase in demand cool off after the tax was implemented. Most experts however say that without the tax, the sky high prices at Vancouver would have leapt up even further.
At Vancouver, as demand for houses grew, the total number of house and apartment properties listed decreased when compared with the same period last year but have risen slightly compared to previous months of this year.
The sales-to-active listings ratio for April 2017 was 45.5 per cent for all types of property, a two percent fall from March 2017.
For detached homes, the sales-to-active listings ratio was 26 per cent, 58.2 per cent for townhomes, and 82.2 per cent for condominiums. However actual sales of detached properties fell around 39 percent from a year ago. Actual sales of apartments and condos fell 18 percent from the same period a year ago. Townhouses or attached houses saw a sales decrease of 11 percent in April.