Wednesday, October 3, 2018

Vancouver condo listings keep piling up — and many more are on the way

Vancouver condo listings are rising amid weakened demand, a perfect recipe for lower selling prices and a trend experts suggest won’t reverse in the near future.
“I think we’re really at the early stages,” says Steve Saretsky, the Vancouver realtor who created the VancityCondoGuide, of the condo market’s cooling.
“Condos really topped out in the winter of 2017, so you could argue that the correction in that space is really just beginning,” he tells Livabl, noting it can take years for a market to really reach bottom.
Further aggravating the situation is an anticipated number of condo completions that are expected early next year.
Typically, these units would have been purchased before shovels even broke ground in what’s known as a pre-construction sale, technically an agreement to buy at a later date.
When the units are finished, the owners — who are typically investors rather than end users — will look to sell off their units or rent them out, suggests Saretsky.
“That is going to bring lots more supply,” he says. “I think it’s a huge thing that hasn’t really played out a whole lot yet,” he adds in an interview.
In a report released last month, Central 1 Credit Union flagged the potential risks the pending completions present for the overall real estate market.
So far, home listings have already surged compared to the same time last year, according to the REBGV’s latest monthly data, published this week.
In all, there were 13,084 resale properties available in Metro Vancouver in September, up 38 per cent from last year and 10.7 per cent over August.
The number of condos on the market in Greater Vancouver at the end of September was 75 per cent higher than what was counted at the same time in 2017.
At the same time, condo sales have plunged. Apartment transactions totalled 812 last month, representing a 44-per-cent decrease from 12 months prior, says REBGV’s report.
“Weaker sales [and] rising inventory generally leads to lower prices, and that’s sort of what we’re starting to see in the condo space,” says Saretsky.
Over the last three months, Vancouver condo prices are down 3.1 per cent, according to REBGV, which pegged the benchmark price at $687,300 in September.
Saretsky is not alone in anticipating Vancouver’s housing market won’t recover any time soon. In a note published this morning, BMO Senior Economist Robert Kavcic also highlighted elevated listings and declining prices in not just the condo market but the detached segment as well.
“We would not be holding our breath for a quick price rebound in this market,” writes Kavcic in the note titled “Vancouver Housing Still Reeling.”
by Josh Sherman

View image on Twitter

Vancouver home sales continued lower last month

Sales of homes in Metro Vancouver remained well-below long-term norms in September.
The Real Estate Board of Greater Vancouver reported sales of 1,595 homes in the month, down 43.5% from a year earlier, 17.3% below August 2018 levels, and 36.1% below the 10-year average for September.
Lower demand has allowed inventory to build with 13,084 homes available on the MLS for Metro Vancouver, a 38.2% increase year-over-year and a 10.7% increase month-over-month.
There were 5,279 detached, attached, and apartment newly-listed properties in September; 1.8% down year-over-year but a 36% jump from August.
“Since spring, home listing totals have risen to levels we haven’t seen in our market in four years,” said Ashley Smith, REBGV president-elect.
“Metro Vancouver’s housing market has changed pace compared to the last few years. Our townhome and apartment markets are sitting in balanced market territory and our detached home market remains in a clear buyers’ market,” Smith said.
Market by property type
Sales of detached properties in September 2018 reached 508, a 40.4% decrease year-over-year. The benchmark price for detached properties is $1,540,900, down 4.5% y-o-y and a 3.4% decrease over the last three months.
Sales of apartment properties reached 812, a 44% decrease y-o-y. The benchmark price of an apartment property is $687,300, down 7.4% y-o-y and a 3.1% decrease over the last three months.
Attached property totalled 275, a 46.9% cent decrease compared to September 2017. The benchmark price of an attached unit is $837,600, down 6.4% y-o-y and a 2% 

by Steve Rendall

Thursday, September 6, 2018

New rules cut inventory in half

The City of Vancouver says the number of short-term rentals listed online has dropped by almost half since new rules came into effect requiring operators to have a business licence.
There are 3,742 active Vancouver listings on sites like Airbnb, compared with about 6,600 in April, when the regulations were introduced, the city said Wednesday.
Kaye Krishna, the city's general manager of development, buildings and licensing, called the early results of the efforts to regulate short-term rentals ``very promising.''
``As we move forward with continued public education and increased enforcement we expect to see the short-term rental market stabilize,'' Krishna said in a statement.
As of Sept. 1, operators must have a business licence, which costs $49 annually, and must include the licence number in their listing. Operators can only advertise their main residence and must have permission from their landlord or condo board, or they could face fines of up to $1,000 a day on each platform where the rental is advertised.
The city says it has one of the highest initial compliance rates by any major city globally, with 2,640 short-term licences issued, representing about 70 per cent of existing listings.
When the new rules were announced earlier this year, Mayor Gregor Robertson said they were intended to protect and free up rental housing in response to a critically low vacancy rate.
Most of the listings taken off the market were the result of an agreement the city signed with Airbnb. The online platform has deactivated 2,482 Vancouver listings that did not include a business licences.
The agreement also means long-term rental operators can no longer accept rentals of less than 30 days. In addition to the unlicensed listings removed by Airbnb, more than 660 listing were removed or converted to long-term rentals by individuals in response to the new rules, the city said.
Expedia, which is the second-largest platform in Vancouver, has also agreed to add a field where business licence numbers can be added to their online listings on VRBO.
After introducing new rules in April, the city allowed a registration window for operators to comply through Aug. 31, and also began enforcement for unsafe dwellings and commercial operations that would clearly not meet the new regulations.
It has investigated more than 2,650 listings and says that since Sept. 1, 294 new addresses have been flagged for non-compliance and are subject to enforcement.
``The short-term rental program will continue to strengthen as the city expands its data sources and ongoing dialogue with multiple partners,'' the city said in a statement.
Residents are encouraged to continue to report suspected illegal short-term rentals.
Jens von Bergmann, principal at MountainMath Software and Analytics, said Airbnb's agreement to share data with the city such as the address and business licence for a listing represents a new model for Canada.
But there are still some operators bending the rules on the platform, based his own analysis of the data, von Bergmann said.
In one case, a business licence has been used for multiple properties, he said. In another, an operator appears to falsely present their listing as a hotel or other commercial enterprise that would be exempt from this type of business licence.
But Bergmann said he sees the city's initial results as positive.
``It looks encouraging. I think the real test is, will those listings that are right now clearly non-compliant disappear?''
``The other test will be how many fines are actually levied.''

The Canadian Press

Wednesday, August 8, 2018

Vancouver’s condo market expected to sit in buyers’ territory for the rest of 2018: expert

As Vancouver condo inventory increased in July in the face of plummeting sales, one Vancouver realtor says the market is favouring buyers and will continue to trend in this direction for the rest of the year.
Last month, a total of 427 condos changed hands in the city, down 22 per cent from a year ago, according to the Real Estate Board of Greater Vancouver (REBGV).
July’s sales were also 20 per cent below the 10-year sales average for the month.
“We’re entering into a slower period from a seasonality perspective so I think that you’ll probably continue to see the market trend towards favouring buyers. I think inventories are going to keep building up here and I don’t expect sales to get stronger in the back half of this year. I think for buyers it’s definitely encouraging,” Vancouver-based realtor Steve Saretsky tells Livabl.
In a blog post, Saretsky writes that, so far, condo sales have declined each month this year and dropped to their lowest total for July in six years.
Saretsky attributes the fall in sales to a combination of factors, including government intervention and higher interest rates.
With condo sales dropping and more supply hitting the market, inventory is on the rise in the condo segment.
In July, Vancouver’s condo inventory hit a three-year high for the month, increasing 32 per cent compared to a year ago.
Saretsky says supply still remains low on a historical level but is starting to grow — an uncommon trend in the city.
“Over the last couple of years, the trend has been lower inventory and more sales and now it’s fewer sales and higher inventory. So, buyers and sellers alike have to adjust to that,” says Saretsky.
While the city is experiencing a slower sales pace, Saretsky says prices are still holding up relatively well.
He adds that condo prices peaked in the beginning of 2018 and have been declining ever since.
“Condo prices have definitely topped out and I would say they topped out in Vancouver probably about four or five months ago. And, since then, it’s been a steady decline lower. I would say typical condo prices are off about 5 per cent from their peak,” says Saretsky.
Last month, the average sales price of a condo dropped two per cent compared to a year ago.

Thursday, August 2, 2018

Vancouver home sales hit 18-year low

VANCOUVER _ Home sales in July across Metro Vancouver tumbled to their lowest level in 18 years in statistics compiled by the real estate board, but prices remained steady since last month.
The Greater Vancouver Real Estate Board says 2,070 properties changed hands in July, a 30 per cent plunge when compared with July of last year and about 29 per cent below the 10-year sales average for the month.
The number of condos, townhomes and detached houses listed for sale were up 32 per cent year-over-year, and 1.6 per cent since June.
The real estate board says the benchmark price for all residential properties was just under $1.1 million, a 6.7 per cent hike over July 2017 but a slip of 0.6 per cent since June.
Board president Phil Moore says the number of sales to active listings across Metro Vancouver last month was pegged at almost 10 per cent for detached homes, 20 per cent for townhomes and about 27 per cent for condos.
Analysts expect downward pressure on prices when the ratio dips below 12 per cent, while property prices tend to climb when it is over 20 per cent.
Moore said there's less upward pressure on home prices across the region.
``This is most pronounced in the detached home market, but demand in the townhome and apartment markets is also relenting from the more frenetic pace experienced over the last few years,'' Moore said in a news release on Wednesday.
Real estate board data shows July sales of single detached homes plunged nearly 33 per cent compared with July of last year, while the almost $1.6 million benchmark price slipped 1.5 per cent over the same period and is down 0.6 per cent since June.
Sales of condos decreased 26.5 per cent year-over-year while sales of townhomes fell by almost 35 per cent, but both property types have seen price hikes above 12 per cent since last July.
The benchmark price is $700,500, for a condo and $856,000 for a townhome, but the board says prices for condos and townhomes have slipped about 0.5 per cent since June.
``With increased mortgage rates and stricter lending requirements, buyers and sellers are opting to take a wait-and-see approach for the time being,'' Moore said.

The Canadian Press

Tuesday, July 24, 2018

Burnaby council the first to use new legislation aimed at developers

The City of Burnaby says it will be the first in British Columbia to take advantage of the province's new rental zoning laws.
The city says in a news release that it will begin implementation of a rental zoning bylaw aimed at maintaining rental stock at affordable rates.
On Monday, Burnaby council passed a motion asking city staff to implement the bylaw requiring developers to replace all rental suites if an apartment is renovated or rebuilt.
The bylaw requires the replacement units to be in the same neighbourhood, rented at affordable rates and be made available to current tenants.
Legislation passed in May by the provincial government allows municipalities to zone undeveloped property for rental housing and set out a specific number of rental units in a development.
Burnaby Mayor Derek Corrigan says the city has been calling for municipal authority over rental zoning for almost 30 years.
``We were optimistic when the new legislation came in about six weeks ago that allows us the tools to require older market rental buildings be replaced as part of any redevelopment,'' he says.
In the past, Corrigan says cities could only attempt to negotiate density in exchange for small numbers of rental suites, but the new legislation gives municipalities the authority to require replacement of rental suites.

Monday, July 23, 2018

Will BC’s new strata short-term rental fines help boost Vancouver’s vacancy rate?

In an effort to curb British Columbia’s housing affordability crisis, the provincial government has introduced higher fines for strata short-term rentals. And, according to one realtor the fines could help renters grappling with the City of Vancouver’s severely-low vacancy rate.
Last week, the BC government announced that, as of November 30th, strata corporations can impose a fine of up to $1,000 a day to owners and residents who don’t comply with a strata bylaw that limits or bans short-term rentals.
According to a press release, the BC government decided to increase the allowable fine as the previous penalty of $200 a week was not a “sufficient deterrent.”
Vancouver-based realtor Steve Saretsky says this could be welcome news for Vancouver renters who are struggling to find housing in a market with a vacancy rate of less than one per cent.
“[I] think at a time when our market’s really starting to slow down here, this is just another thing that’s probably going to free up some more rental supply and maybe take away a little bit more of the investor demand,” Saretsky tells Livabl.
Strata housing often refers to multi-unit developments, but can also include duplexes, townhouses and single-family homes which belong to a strata corporation. Stratas are self-governed and made up of all the strata owners.
The fine hike comes shortly after the City of Vancouver partnered with global home-sharing website, Airbnb, in April to allow Vancouverites to use their primary residences as short-term rentals, as long as they obtain a business licence.
Although the immediate impact of higher fines for strata short-term rentals is unknown, Saretsky says the new rules could cause demand in the City of Vancouver’s condo market to drop further.
“I don’t think it’s going to have a significant impact, but I think you’re adding on another demand-side policy at a time when the condo market is already really slowing down. I think any sort of little changes here and there are all going to add up,” says Saretsky.
In June, the city’s condo sales plummeted to a five-year low with a total of 475 units, according to the Real Estate Board of Greater Vancouver (REBGV).
As for rental prices, Saretsky notes that the new policy could also help keep prices stable in the coming months.
“Recent data and discussion with property managers suggest that rents have sort of topped out here over the last couple of months, so maybe this will sort of keep rent prices in check in the city.”
Kerrisa Wilson