Detached Housing Market Update
Statistically speaking, the detached housing market looked solid in March. This is one of those situations where you need to overlay the macro with the micro to try and see through this. Detached sales were up a whopping 62% year-over-year. A great headline, however, it is important to contextualize that detached sales for March 2019 were the lowest on record, dating back to 1990. Weak base effects made for a great headline.
New listings really started to fall off towards the back end of the month as sellers delayed the sale of their home due to the virus. This left new listings down 16% on a year-over-year basis in March. As a result, overall inventory plunged 32% on a year-over-year basis. This left months of inventory for sale at 4.5.
Chart title “Greater Vancouver Detached Months of Inventory for Sale”
Title “Greater Vancouver Detached Months of Inventory”
Given the dramatic shift in market conditions towards the back half of the month there are a couple things to note here. New listings fell immediately, in real time. Whereas sales which are recorded when they are processed by the Real Estate Board, continued to trickle in towards the end of the month. For example, we saw sales that were agreed to at the beginning of the month get processed towards the end of the month. Therefore, expect sales to fall harder next month.
As for prices, those take even longer to filter through into official data. Both the average and median sales price for a detached home were up on a year-over-year basis, and that is more reflective of the recovery we had experienced over the past six months heading into March. Here we can see the official MLS benchmark price climbed 0.7% from last year. It would not surprise me to see this move higher in the next couple of months despite the market hitting pause because of how these metrics are calculated/ processed.
Overall, the detached market looked healthy and stable going into the busy spring market, obviously recent events have put a dent in those plans.