As we have seen throughout this year, the condo market continues to outperform the detached housing market. However, outperform might be a little too generous. Condo sales across Greater Vancouver fell 23.9% from last year, this marked the fewest condo sales for the month of June since 2002. This is particularly concerning given this doesn’t account for the increase in population growth and new condo stock during that time period.
Similar to the detached market, the majority of the weakness in the condo market is at the higher end of the spectrum. In other words, the more expensive the condo the more challenging it is to sell. This should not be mistaken for assuming entry level condos have not been impacted. One bedroom and studio units have witnessed sales fall and prices drop as well. One bedroom and studio condo sales were down 27% year-over-year with the average price per square foot sinking by 6.9% (8.7% decline for 2 bedroom condos).
Inventory jumped by 46.5% year-over-year to the highest levels since June of 2015. This allowed the overall months of inventory to inch higher to 6.2 months. This is indicative of a buyers market but certainly not cause for panic.
As a result of the 17 year low in condo sales and the jump in inventory, prices continued their descent. The MLS benchmark price of a condo fell 8.9% year-over-year to $654,700. As we have mentioned before, price discovery in the condo market is much more fluid than in the detached market where the characteristics of each house and property can vary significantly.
This is an excerpt from the Saretsky Report. You can subscribe to the monthly reports for free HERE.