The real estate market is generally always evolving. In Vancouver and other major centres in Canada, the market has remained strong throughout the pandemic, however, prices have been softening and sales are taking a little longer than during the peak times in 2021/2022.
According to the Real Estate Board of Greater Vancouver (REBGV), January 2023 saw 1,022 home sales, more than a 50% decline from January 2022. When comparing January 2023 to December 2022, sales declined by just over 21% from 1,295 units sold in December.
The Multiple Listing Service ® (MLS®) in Metro Vancouver saw 3,297 new listings in January 2023, whereas January 2022 saw 4,170 homes listed for sale. While this represents a 20.9% drop, it reflects a significant increase against December 2022, which saw only 1,206 new listings.
According to the British Columbia Real Estate Association (BCREA), 3,047 residential units were recorded sold in January 2023 across the Province. Year over year, this represents a decrease of 50.3%. In greater Vancouver, the average price fell 8.4%, year over year, to $1,167,134.
The Bank of Canada interest rate has undergone eight (8) increases over the past year, however, indications are that further increases may be suspended if the economy continues to warrant this policy.
The Bank of Canada rate increased from a low of 0.25% in March 2022 (and many months prior) to 4.5% in January 2023. With this, comes higher prime rates, as well as higher variable and adjustable mortgage rates.
Effective January 1, 2023, the Government of British Columbia has enacted a new regulation allowing home buyers to back out of a real estate purchase for up to three business days after signing a contract. This cooling-off period applies only to the purchase of the residential property.
The Province believes it will provide buyers an opportunity to do their due diligence for obtaining financing or having a home inspection completed even if the buyer does not list these as “Subjects”. Now, the buyer can end the contract for any reason, within three (3) business days. If deposit funds have been paid upon acceptance of the Offer, the buyer is entitled to a refund.
Buyer beware: should you cancel a contract within the three-day cooling-off period, a Recission Fee of 0.25% is payable to the Seller. For example, if the purchaser exercises the right of rescission on a $900,000 home, they’d be required to pay the seller $2,250.
How this will affect the real estate market in Vancouver remains to be seen. For all your real estate needs, contact One Flat Fee and speak with our professional, qualified team.