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Are Real Estate Prices Dropping In Vancouver?

A hot topic over the past couple of years has obviously been about the state of the real estate market in Canada due to the COVID-19 pandemic. Unsurprisingly, some of the hottest real estate markets where housing prices increased the most were in Vancouver, Toronto, Hamilton, and Montreal. First-time buyers and those looking to relocate were driven by the low interest rates but were getting incredibly frustrated by intense bidding wars, the lack of housing supply, and the talk about a potential market crash.

But, headlines have been confusing people all across Canada. One minute people are talking about a potential market crash while others expect home price growth to continue, preventing many people from entering the housing market in the first place. This has definitely been the case with the Vancouver real estate market.

The State of Vancouver’s Housing Market

British Columbia is a desirable location for first-time buyers, those looking to retire, those looking to rent, and for real estate investors so it’s really no surprise that the market boomed during the COVID-19 pandemic, especially as people were looking for bigger spaces to work from home and take advantage of the low interest rates.

It’s also no surprise that in Metro Vancouver, home prices skyrocketed immensely, however, condo prices dropped.

More About Metro Vancouver

Also known as Greater Vancouver, this area covers 21 municipalities with a population of nearly 2.5 million people. Its major urban centre is the City of Vancouver, British Columbia.

The Royal Bank of Canada (BoC) predicted cooling of both home sales and prices within the next couple of years, but real estate professionals said it’s not that easy, according to this article by Vancouver Island Free Daily. The reason the BoC is predicting falling home sales and prices is because of the increased interest rate in April (by 0.5%), and another one expected in June. The initial hike was the highest increase made in 20 years. But, real estate agents are saying that there will be minor impact on home buyers in specific market segments, and for those that have nowhere else to put their capital. Regardless of rising interest and mortgage rates, for them, it’s an investment.

Benchmark Home Prices In The Vancouver Area

These house prices were updated on April 5th, 2022 and posted on WOWA.ca:

  • The benchmark home price in Metro Vancouver was $1,360,500 in March 2022, a 21% increase from this time last year
  • The benchmark price for a detached home was $2,118,600, a 25% increase from this time last year
  • The benchmark price for a townhouse was $1,138,300, a 31% increase from this time last year
  • The benchmark price for a condo was $835,500, a 17% increase from this time last year

Where Are Things Headed For 2023?

In February, according to the BC Real Estate Association (BCREA), residential sales were forecast to drop by 17% while home prices were forecast to rise by 8.5%, mainly in the first half of the year.

BCREA chief economist Brendon Ogmundson says home sales in 2022 are expected to “moderate from the frenetic pace of 2021,” with declines continuing into 2023 by approximately 12%. Despite a potential decline in home sales, “sales activity will remain high by historical standards,” he adds. The BCREA forecast estimates sales activity will “normalize” in 2023 due to several factors, including the bank raising interest rates.

The Cheapest Places To Live In BC

As mentioned above, BC is a very desirable place to live and there are various reasons people choose to move there. Not only are you surrounded by beautiful scenery everywhere you look, but you’ll also be experiencing low crime rates, cultural diversity, various outdoor activities to enjoy, great employment and educational opportunities, and great real estate investment opportunities (particularly for condo owners).

If you’re interested in getting in on BC’s housing market but you have a limited budget, here are five of the cheapest places to live in BC:

    • Smithers – The average price of a home in February 2022 was $360,533
    • Cranbrook – The median asking price for a home is $559,000
    • Prince Rupert – The average selling price for a home last September was $418,985
    • Prince George – The average price of a home in March 2022 was $526,000
    • Hope – The average price of a home in April 2022 was $552,042

Looking For A Home In Metro Vancouver?

The BRAND Real Estate Group is a team of trusted professionals that represent buyers and sellers looking to relocate to, or in, Metro Vancouver. Whether you’re dreaming of owning your own home or are looking for an investment property, we have access to a large list of homes and condos for sale. We can help you reach your goals today.

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