Apartment sales driving Lower Mainland housing market

Buyers across the region appear to be buying ahead of new mortgage requirements in January

Vancouver and the Fraser Valley both experienced above-average home sales last month, according to local real estate board figures, as buyers try to get ahead of the new mortgage requirements in January.

Vancouver area home sales jumped 7.1 per cent from September to October with 3,022 properties sold, and 35.2 per cent from the same month last year, according to the Real Estate Board of Greater Vancouver (REBGV).

The federal government’s plans to tighten mortgage requirements for the seventh time in eight years helped spur short-term activity, said the REBGV president Jill Oudil in a statement.

“We have definitely seen some spur in activity, likely for any buyers that are wanting to make sure they jump in before the change in the rules,” she said.

The Office of the Superintendent of Financial Institutions will implement new lending guidelines at the beginning of next year. Among the changes being considered is a requirement that homebuyers who do not require mortgage insurance still have to show they can make their payments if interest rates rise.

READ MORE: Vancouver home prices may have seen ‘final hurrah,’ Royal LePage says

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Additionally, some buyers may be trying to beat any further Bank of Canada interest rates hikes, Oudil said.

The average selling price for a home in Vancouver last month was $1,042,300 — up half a per cent from September and 12.4 per cent from the same time last year, according to the Vancouver board.

The Fraser Valley saw a similar increase in average home prices to those in Vancouver. Average home prices were $971,900, last month – up 11.8 per cent compared to October 2016.

Price growth in the Fraser Valley and Vancouver was driven by appreciation in townhomes and condos.

READ MORE: Chilliwack the last bastion of housing affordability in the Lower Mainland

In the Fraser Valley, the divide between selling prices of attached and detached markets continues to widen, according to Gopal Sahota, president of the Fraser Valley Real Estate Board.

The average selling price for apartments was $369,400 – an increase of 36.4 per cent compared to October of last year.

“Apartment activity was notably strong in October, with a sales-to-actives ratio of 105 per cent, meaning that apartments are selling as fast as we can list them,” Sahota said in a statement.

In the Vancouver area, the benchmark price of a condo rose to $642,000 in October. That’s up one per cent from the previous month and 22.7 per cent from Oct. 2016. The townhouse price jumped to $802,400 — up two per cent from September and 17.7 per cent from the same month last year.

Oudil attributes that to high demand with limited supply, as well as shifting preferences for smaller yards because of hectic lives.

Chilliwack sales also continue to climb

Sales in Chilliwack were up 27.7 per cent in October year over year, according to the Chilliwack and District Real Estate Board (CADREB).

There were 350 sales in the CADREB area up from 274 October 2016.

Prices, too, continue to climb with the median sale prices at $535,000 up 20.2 per cent from $445,000 a year ago.

With files from Aleksandra Sagan, The Canadian Press


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