Falling Prices Persist As Market Slowdown Continues To Linger

This August marked a continued period of transition for the Vancouver real estate market, with sluggish sales and deepening, four-month streak of falling transactions. A total of 1,904 properties were sold in our region last month - a 17.1% decrease from the 2,296 sales recorded in August 2023, and 26% below the 10-year seasonal average of 2,572 sales. 

New listings also followed suit with softened activity, in line with the slowed pace of sales. There were 4,109 new homes brought to MLS this August, representing a 36% decrease from July 2024, although still a 4% increase year-over-year. Total inventory levels remain well above typical levels with a total of 13,812 homes currently listed - 37% more homes than were available at the same time last year and 20.8% above the 10-year seasonal average.

Benchmark Prices Edge Down & Detached Homes Enter Buyer's Market

August numbers reveal that home prices are continuing to drop. With the sales-to-active ratio for detached homes now sitting at 9.6%, this property segment is now officially considered a buyer’s market. As we move into the traditionally more active Fall market, many wonder if September will mark a turning point, leading to a rebound in prices, or if the downward trend will continue to persist.

The benchmark price for Greater Vancouver property is now $1,195,900 - a 0.9% decrease compared to August 2023 and a 0.1% decrease from July 2024. The average price is now $2,048,400 for single-detached homes, $1,119,300 for attached homes, and $768,200 for condos. Detached and attached homes are down between 0.1% and 0.5% from July  2024, though still priced 1.8% and 0.8% higher year-over-year. Condo prices were unchanged month-over-month and down 0.1% from August 2023.

As Bank of Canada Cuts Rates, All Eyes Are On September For Possible Market Shift

The Bank of Canada's third consecutive cut means the key interest rate now stands at 4.25%, down from the previous 4.5%. This rate cut decision reveals that inflation has eased, with recent data showing inflation at a 40-month low. The central bank has reiterated its goal of bringing inflation down to 2%, and Bank of Canada governor Tiff Macklem noted it was reasonable to expect future rate reductions if inflation continues to decline. Though the timeline is still uncertain, in this recent announcement there were clear signals of a willingness to continue cutting rates, dependent on the economy and future unemployment rates. However, if the economy proves stronger than anticipated and inflation more stubborn, the Bank could switch gears and pause the easing cycle at a future decision. With the Fall market right around the corner, many questions remain for both buyers and sellers. Will this rate cut will impact sales activity, shift rising prices, or is the downward trajectory set to persist?