July 2024 Greater Vancouver Real Estate Market Insights
Welcome to the July 2024 episode of the Presale Pulse, a real estate show brought to you by hosts Suzana Goncalves and Brittany Reimer. Watch the video to understand the latest macroeconomics, presale, 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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Mixed Macroeconomic Signals: Inflation Ticks Up, Rate Cuts Expected
In July, the macroeconomic environment reflected a mixed bag of indicators, with inflation slightly ticking up to 2.9%, an increase of 0.2% from the previous month. Despite this rise, inflation remains within the Bank of Canada's target range of 1-3%, and the broader trend suggests an overall cooling of the economy. This was underscored by the fact that the three-month average CPI is significantly lower than the 12-month average. While the Bank of Canada is anticipated to cut rates again by 25 basis points, concerns remain over recent job losses, which may counterbalance inflationary pressures. The situation is further complicated by the need to align with U.S. monetary policy, as the U.S. Federal Reserve has held rates steady, potentially widening the gap between Canadian and U.S. rates. Moving forward, CPI and employment metrics will be crucial in determining the direction of future rate adjustments.
Cautious Developer Strategies Amid Economic Uncertainty
With 12 projects launching, offering a total of 1,810 units, June saw a decrease in new releases compared to previous months, yet remained consistent in unit volume compared to last year. Absorption rates remained subdued, with only 296 units sold, translating to a 16% absorption rate. Developers continue to navigate market uncertainty, some opting to delay launches until fall or beyond, while others seize the moment to gauge buyer interest through extended preview periods. Economic indicators, including a slight uptick in inflation to 2.9%, tempered expectations despite recent interest rate cuts, signalling a measured approach to market recovery.
Metro Vancouver Resale Market Cools: Sales Down, Inventory Up in July
In July, Metro Vancouver's resale market saw a continued cooling trend, with sales declining by 11.5% from the previous month and 19.1% from the previous year, totaling 2,418 transactions. Despite recent rate cuts, buyer demand remained tepid, with sales falling nearly 24% below the 10-year seasonal average. The number of active listings rose to 14,182, a 4.3% increase from June and a significant 42% jump compared to the same time last year, reflecting a growing gap between seller expectations and buyer willingness. This imbalance contributed to a slight 0.4% drop in the benchmark Home Price Index (HPI) from the previous month, though prices remain up 0.5% year-over-year. As the market transitions into a balanced state with a sales-to-listings ratio of 17.6%, further softening of prices could be on the horizon if inventory continues to outpace demand.
Presale Projects mentioned in this episode:
- Bassano - Boffo Developments
- Jericho Park - Essence Properties
- Hendry - Trillium Projects
- Level - Jayen Properties
Links mentioned in this episode:
- July 2024 Presale Pulse Report
- MLA Advisory Services and Sample Reports
- Contact Advisory
- Subscribe to MLA Newswire
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