BC home sales slow as real estate market re-balances

Published: Thursday, January 04, 2007
It's official, the Lower Mainland's residential real estate market is definitely slowing down.

In 2006, home sales in the Greater Vancouver area -- which stretches from Whistler to Maple Ridge and Tsawwassen -- were down 12.4 per cent from 2005 and two per cent below 2004 numbers. Sales in December were down 28 per cent compared to both a month and year earlier.

But the number of sales in December -- 1,686 -- is still considered a good market and nothing will compare to the phenomenal numbers of 2005, said Rick Valouche, president of the Real Estate Board of Greater Vancouver.

The beginning of 2006 also started at a blistering pace, but the second half of the year was "most definitely" slower, he said.

And while sales are down, prices continue upward, again at a slower pace, he said.

"We need that because we were just starting to get a little bit crazy," Valouche said.

Average house prices ended the year at $775,700, up 24 per cent from $627,500 a year earlier. Attached homes went to $441,000 from $401,500, an increase of only 10 per cent, and apartments increased 14 per cent to $353,800 from $309,700.

Increased listings, usually a sign of a slowing market, failed to materialize in December, but Valouche was hopeful that will reverse this month. "I think we are continuing on the road toward balance," he said.

David Rishel, president of the Fraser Valley Real Estate Board agreed that the market was different now than it was in the first six months of 2006.

"The first part of 2006 was very busy and it just slowly got a little bit quieter and a little bit quieter as the year went on," Rishel said. "It's a very balanced market now. People don't have to make those rush decisions. They can take their time and be a little bit more well-informed."

In the Fraser Valley area, which encompasses north Delta to Abbotsford on the south side of the Fraser River and Mission on the north side, sales were down almost 11 per cent from 2005, but still beat 2004 numbers, which at the time constituted a new record. Over the year, listings were up slightly but the number of active listings at the end of the year were 46-per-cent higher than a year earlier.

The average price for a townhouse in the area fell almost seven per cent in December compared to November, while apartment prices fell three per cent and house prices remained steady. But year over year, detached homes were up 19 per cent to $488,000 from $410,000, townhomes rose 10 per cent, from $259,000 to $285,000 and apartments increased 15 per cent, from $168,500 to $193,500.

Prices are not expected to drop.

Canada Mortgage and Housing Corp. predicts prices in the Vancouver area to increase between six and nine per cent in 2007, with the largest rise in apartments where there is still room for growth, CMHC's market analyst Bryan Yu said.

That's a slowdown from the double-digit increases the area has been seeing, Yu said.

(prepared by Fiona Anderson/Vancouver Sun)