Real estate sales are down in Metro Vancouver but there's optimism, despite uncertain future ahead
Home sales expected to rebound by 45 per cent in 2021 after dismal year due to COVID-19, economist says
Buying a home these days looks a bit like a visit to the doctor's office.
When Vancouver real estate adviser Ammar Sedqui shows a property, there are no open house days with long lineups. Viewings — if they're not done virtually — are made by appointment. Prospective buyers need to wear a mask, gloves, and sign a waiver stating they have no symptoms of COVID-19.
It's a necessary process that's added another hurdle to the process of selling a home, he said.
"A lot of people I understand might not be comfortable with it and that decreases the number of listings in the market and affects the whole market as well," Sedqui said.
Spring is typically one of the busiest times of the year for the industry. This year, with the province in a recession due to the pandemic, home sales in Metro Vancouver reached historic lows in April. Then, sales decreased by more than 40 per cent in May compared to last year, according to the Real Estate Board of Greater Vancouver.
That's more than 50 per cent below the 10-year average for sales in May.
People are hesitant to open up their homes during a pandemic, and Sedqui says it's difficult to list properties that are still occupied. But real estate agents are coming up with innovative ways to show homes, and the market remains steady despite fewer listings, he added.
"There are still a lot of people who need to buy or need to sell places for various reasons," he said.
'A really unusual time'
Home sales are expected to drop by more than 20 per cent this year before rebounding by 45 per cent in 2021, according to the British Columbia Real Estate Association.
Gradual loosening of COVID-19 restrictions, low mortgage rates and pent-up demand could help the recovery, said Brendon Ogmundson, chief economist for the B.C. Real Estate Association.
This kind of recovery was seen after recessions in the early 80s, 90s and after the 2008 financial crisis, Ogmundson added.
He expects this time to be similar, although certain factors, like a second wave of COVID-19 or slashed government support could have an impact in the months to come.
"It's a really unusual time and a really unusual recession," Ogmundson said. "We're not going to get all the way back to normal right away, but we're on a nice path."
The pandemic appears to have had little impact on the average price of a home in Metro Vancouver, which is now just over $1 million.
Options are slim for first time or entry-level buyers, Sedqui said.
There are too many uncertainties in the months ahead to really know when sellers will be able to show their homes more easily and attract more buyers, he added.
"We can predict based on what's happened previously, but none of us have been in this situation before," he said.
"No one's got a crystal ball to look at and see what's going to happen."