In an article in the Vancouver Sun, Derrick Penner writes that real estate sales across the Lower Mainland continued their upward trend throughout August defying early forecasts which called for moderation in the markets. The Multiple Listing Service recorded sales were up 12.9 per cent across Metro Vancouver compared with the same month a year ago, the Real Estate Board of Greater Vancouver said.
During August, 3,384 properties sold in Vancouver alone, with the average price for a single family home hitting $726,067, up 11.1 per cent from a year ago. “We’ve seen sales near record levels for three consecutive months despite the summer traditionally being a slower time for real estate in Greater Vancouver,” board president Brian Naphtali said in a news release.
It wasn’t just single family homes that enjoyed the increase, condo sales saw the biggest growth with 16 per cent more transactions at 1,504 compared with the same time last year. The average price for a typical condo was $367,944 in August, up 11 per cent from this time last year.
“The Canadian Real Estate Association revised its annual forecast for 2007 in August because the market so far this year has performed much stronger than they predicted it would,” said Jim McCaughan, president of the Fraser Valley Real Estate Board, an area which also demonstrated price increases.
However, Helmut Pastrick, chief economist for Credit Union Central B.C., said the resurgence in 2007’s real estate markets follows from a period in 2006 when sales had started to fade because of rising mortgage interest rates. “We did have a bump up in mortgage rates in mid-May,” Pastrick added, which might still result in declining sales. In any event, Pastrick said he expects overall sales in Greater Vancouver to end up higher than in 2006.
Cameron Muir, chief economist for the B.C. Real Estate Association, added that while prices across the Lower Mainland are up, their rate of increase has slowed considerably from the inflation seen in 2006. “Price growth has moderated, but not as rapidly as we had expected it to at the beginning of the year,” Muir said. He added that buyers who rushed in to use mortgages that they had pre-approved before May’s rate increases also helped bump up sales in recent months.
“It will be interesting to see what happens in the fall months in terms of this upward trend,” Muir said. “Is it going to continue?” Muir said buyers at the bottom end of real estate markets are being squeezed out, which is one of the biggest issues the region faces. At the top end though, Muir said those who have benefited from the economic prosperity of the times, and baby boomers who have seen significant equity gains, continue to drive sales.