Vancouver area benchmark house price now $1.4M, up 30% in 1 year
'Unprecedented surge of demand' driving price climbs despite CMHC overvaluation warning
The insanity, it seems, is not over.
Despite ongoing warnings from the CMHC that the Vancouver housing prices are overvalued and have outpaced the economic fundamentals in the city, they keep climbing.
In the past year, the benchmark price for a detached home in the region — not just the City of Vancouver itself — has climbed 30.1 per cent, to $1.4-million, according to new numbers from the Real Estate Board of Greater Vancouver.
The "benchmark" price is a measure used by the board to describe what it calls a "typical property" in the market, taking into account bedrooms, lot size, and other factors, and is not an average or median price.
To put that in context, the median family income in the Vancouver metropolitan area is $73,390 — lower than the Canadian average, according to the latest census numbers available.
Biggest growth in suburbs
The highest benchmark price for a detached home is still Vancouver's west side, at $3.2-million, which is up 172 per cent over ten years, and 28.4 per cent in the past year.
But the largest increases in house prices in the past year are outside Vancouver:
- Tsawwassen up 41 per cent to $1.16-million.
- Richmond up 36.5 per cent to $1.5-million.
- Ladner up 35 per cent to $971,500.
Apartment and townhouse listings went up 20.6 and 22.1 per cent, respectively, in the past year in Greater Vancouver.
The Real Estate Board of Greater Vancouver covers Vancouver, Burnaby, New Westminster, Richmond, Port Moody, Port Coquitlam, Coquitlam, North Vancouver, West Vancouver, Squamish, Whistler, Sunshine Coast, Pitt Meadows, Maple Ridge, and South Delta.
The benchmark detached home price in the Fraser Valley also rose 30 per cent over the last year, to $776,500, according to the Fraser Valley Real Estate Board.
That area includes Surrey, White Rock, Langley, North Delta, Abbotsford and Mission.
'Unprecedented surge of demand'
The price increases are, not surprisingly, driven by a strong demand with not much supply.
There was a slight increase in residential listings last month, but not enough to keep up, said Greater Vancouver Real Estate Board president Dan Morrison in a release.
"While we're seeing more homes listed for sale in recent months, supply is still chasing this unprecedented surge of demand in our marketplace," he said.
In April 2016, sales of all properties (not just detached homes) in Metro Vancouver were 41.7 per cent above the 10-year sales average for the month.
Meanwhile, the total number of properties currently listed in Metro Vancouver is down 38.3 per cent from last year.
That means the sales-to-active listings ratio — a measure analysts use take the temperature of a market — was 63 per cent in April 2016, the sign of a seller's market.
Home prices tend to experience upward pressure when that ratio is just 20 or 22 per cent, according to the board.