With the recent slowdown in the Vancouver housing market becoming more widespread, Greater Vancouver (REBGV) home sales for all property types through the first 9 months of the year fell to an all time low. There appears to be some denial or perhaps confusion over current market conditions. Sellers are reluctant to slash prices and buyers feel disgruntled over how little prices have budged. This has ultimately resulted in fewer bids, creating more difficulty for price discovery.
Amidst the confusion, some pockets or price segments remain stronger or perhaps more resilient than others. One way of gauging market conditions in certain price brackets is to compare months of inventory, in other words the time it would take for all the current inventory to sell if it all sold at the current rate without new inventory coming on the market. It is considered a sellers market when the months of inventory falls below 4, and a buyers market when months of inventory climbs above 6.
In the condo market, entry level condos priced from $300,000- $599,999 remain quite strong. There is just 2.9 months of inventory for sale. However, as prices move higher the months of inventory begins to accelerate. Greater Vancouver condos priced from $700,000-$999,999 currently have 8.5 months of inventory. Similarly, condos prices from $1,000,000 to $1,499,999 have 8.6 months of inventory.
Conditions are rather grim in the detached housing market, even for entry level houses. The months of inventory for homes priced between $1,000,000- $1,499,999 sits at 8.6, double the rate compared to September 2017. Houses priced from $1,500,000- $1,999,999 have 14 months of inventory. Meanwhile, months of inventory has ballooned to 16 for homes priced between $2,000,000- $2,500,000.
If history is any guide more affordable homes tend to be more liquid in the event of a housing downturn, but are ultimately not exempt from market forces. Expect months of inventory to slowly climb higher for entry level condos assuming the rest of the market remains sluggish.