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Greater Vancouver July 2023 Pre-Sale Pulse

July 26, 2023

July 2023 Greater Vancouver Real Estate Market Insights

Welcome to the July 2023 episode of the Presale Pulse, a real estate show brought to you by hosts Ryan Lalonde and Suzana Goncalves. Watch the video to understand the latest macroeconomics, pre-sale, and resale trends over the last 30 days affecting the local real estate market across Metro Vancouver and the Fraser Valley. 

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Strong Sales and Price Appreciation in Real Estate Sector Amidst Central Bank Rate Hikes

After four consecutive months of rate pauses, the central bank surprised many by increasing rates by 25 basis points in June, which was followed by another 25-point hike in July. Despite the rate hikes, the surge in consumer spending and pent-up demand in the market, especially in the real estate sector, contributed to strong sales activity and unprecedented price appreciation levels in the year's first half. Immigration and increased spending by new residents also played a role in driving housing demand. While some expected hesitancy in the market, the Bank of Canada's actions were driven by strong leading indicators from labour and inflation reports however it is likely that this will be the final hike. 

Metro Vancouver Pre-Sale Market Inventory Surges

The Metro Vancouver pre-sale market experienced robust sales momentum in June, with active buyers seeking opportunities throughout the region. In response to the increasing demand, developers launched an impressive total of 16 presale projects, introducing a record-breaking 1,800 units to the market - the highest since June of the previous year. Despite the significant influx of new inventory, absorptions for the projects launched in June remained strong at 35%. As the summer months may see a slight decline in sales activity due to vacations and warm weather, the presale market is expected to pick up again in the Fall, driven by the current positive momentum and potential rate pause.

Pent-Up Demand and Immigration Fuel Metro Vancouver's Resale Market Momentum

The Metro Vancouver resale market displayed notable strength in June, with nearly 3,000 transactions recorded, representing a remarkable 21% increase compared to the same period last year. Despite the current interest rates being 325 basis points higher than the previous year, the market has remained resilient. Pent-up demand has also played a significant role in driving the market's momentum, emphasizing the importance of time in the market rather than timing the market. Active inventory remained low, with 9,990 listings, however new listings aligned with the 10-year average for the month, which should support market conditions in the fall if sales decline. Composite benchmark pricing saw a 1.3% appreciation across Greater Vancouver and it is anticipated that benchmark prices may return to 2022 levels by September.

Pre-sale Projects mentioned in this episode:

Links mentioned in this episode:

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