House prices hit new record

Metro Vancouver house prices reached a new peak in January, while the overall pace of sales across the Lower Mainland eased off the torrid pace seen in December, according to reports from the region's real estate boards.

In Metro Vancouver, the benchmark price for a single-family home, the average price for typical homes sold, hit $788,499, some 20 per cent above January a year ago, when prices were still falling during the economic downturn, and two per cent above the previous peak of $771,250 in May of 2008.

That new high, however, was driven mostly by the sales of higher-priced properties in specific municipalities, Robyn Adamache, a market analyst for Canada Mortgage and Housing Corp. said in an interview.

"Mostly, the areas above [the peak] are the west side of Vancouver, Burnaby, Richmond and the Tri Cities," Adamache said.

In the rest of Metro Vancouver within the Real Estate Board of Greater Vancouver's territory, house prices are still below their previous peaks.

While the bounce-back has been rapid, Tsur Somerville, a real estate expert at the University of British Columbia, said the new highs are less concerning given that mortgage rates remain at near record lows.

"That carrying cost and monthly mortgage payment is still down [from peak levels]," Somerville, director of the centre for urban economics and real estate at the Sauder School of Business at UBC said in an interview. "We're not at the point where we're freaking out again [about high prices], but it bears watching."

Somerville added that with overall sales cooling a bit in January compared with last December's high level, the rate of price growth is likely to slow as well.

Sales across the Lower Mainland in January eased off their December pace.

In Metro Vancouver realtors recorded 1,923 sales through the Multiple Listing Service in January, which was more than double the number of sales in the same month a year ago, but off almost 24 per cent from the pace of sales in the previous month.

Price points

Average prices for typical homes sold, in January compared to a year earlier. Metro Vancouver

Single Family: $788,499 +20% Townhouse: $482,478 +13% Condominium: $385,487 +15% Fraser Valley

Single Family: $500,931 +11% Townhouse: $317,719 +8% Condominium: $243,470 +10 %

Source: Real Estate Board of Greater Vancouver, Fraser Valley Real Estate Board.

In the Fraser Valley, realtors saw 981 sales through the Multiple Listing Service in January, off 22 per cent from December, but still more than double the number of sales from the same month a year ago when markets across the Lower Mainland had nearly ground to a halt.

"Sales are not declining," Somerville added. "But we're slowing the rate of [sales] growth to something that makes more sense."

He said January's sales, while below 2005 levels, the region's peak year for transactions, the month was still on par with 2006 and 2007, which were busy years on the region's historical scale.

Somerville guessed that some of this year's reduction in sales may be Olympic-influenced. Condo owners who are renting their properties out for the Games are more reluctant to list them for sale until the event is over.

Jake Moldowan, president-elect of the Real Estate Board of Greater Vancouver, said January was still a busy month for realtors.

He added that a substantial rise in new listings in January was "refreshing for us, because we were getting short of product again."

Homeowners put 5,147 properties on the market in January, which was 139 per cent more than were listed in December, and was 39 per cent higher than in January, 2009.

Sellers in the Fraser Valley listed 2,941 properties for sale in January, a near doubling from the number of new listings put up for sale in December.

("Metro house prices hit new record" prepared by Derrick Penner/Vancouver Sun)