Ashley Smith speaks on real estate trends in Vancouver, providing insight into our current market status.
Ashley Smith was once one of the youngest directors in the history of the Real Estate Board of Greater Vancouver. Now, she’s the president.
Ashley stepped into the role and responsibilities during one of the slowest sales periods in recent history. She’s tracking trends, staying ahead of the curve, and sharing her expert knowledge with the world.
Recently, there has been a shift in real estate market trends in Vancouver. Now, the market appears to be favouring home buyers over sellers, a noticeable move away from the sellers’ market Vancouver has experienced over the past five years. Smith states “With home buyer demand below our long term historical averages in June, the supply of homes in Metro Vancouver continues to accumulate.”
“Realtors registered just over 2,000 home sales on the MLS in June — the lowest sales total for the month since 2000. This is a decrease over the last month and is 35% below our ten year June sales average,” says Smith. The reduced sales activity and surplus of available homes means home buyers have a huge selection to choose from. Smith states that now, “the total supply of homes for sale [in Metro Vancouver is] just under 15,000.” Homebuyers have not experienced this selection of available homes in five years.
Although Vancouver is experiencing a surplus in homes, Smith points out that the market is still balanced. The ‘Sales to Active Listing Ratio’ (a measure of the balance between supply and demand in the housing market) sits at 14%. When the ratio dips below 12% for a sustained period of time, we will find ourselves in a buyers’ market. When it rises above 20% for a sustained period of time, we will find ourselves in a sellers’ market. Currently, while slightly leaning towards a buyers’ market, Metro Vancouver is still balanced.
“Downward pressure on home prices can occur when the ratio dips below 12% for a sustained period. Alternatively, home prices can experience upward pressure when it surpasses 20% for a sus perdio, the ratio today is 14%. The benchmark price for all housing prices in Metro Vancouver is just under 1 million, which is down about 10 points over last year. This is the first time the composite benchmark has dipped below 1 million since May 2017.” – Ashley Smith
After the intense and, at times, remarkable real estate market over the past decade, this decline is to be expected. Although anticipated, the slowing-pace comes with its challenges — namely, getting sellers to come to terms with the changing market values of real estate. It does, however, create an even greater need for trusted, knowledgeable real estate agents — for both buyers and sellers.
Smith delivers insightful and educated reasoning for this trend, stating that “In addition to the economic and policy-induced factors at play, we’ve also seen an expectation gap emerge between buyers and sellers. Sellers are often trying to get yesterday’s value while buyers are taking a cautious wait-and-see approach.”
The takeaway? Buyers and sellers need to trust their realtor with market trends, pricing, and expectations.