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Canadian Employment (October 2024) – November 9, 2024

Canadian employment rose by 0.1 percent from the previous month, growing by 15,000 jobs to 20.597 million in October. The employment rate fell by 0.1 points to 60.6 per cent, while the unemployment rate was unchanged at 6.5 per cent. Average hourly wages rose 4.9 per cent year-over-year to $35.76 last month, while total hours worked were up 1.6  per cent from October of the previous year.

Employment in B.C. fell by 0.3 per cent to 2.829 million with a gain of 8,000 jobs in October, marking the first month of provincial job gain since April 2024. Employment in Metro Vancouver rose 1.2 per cent to 1.606 million in October. The unemployment rate in B.C. fell by 0.2 points to 5.8 per cent in October. On a similar trend, Vancouver's unemployment rate fell by 0.5 points from last month to 6.2 per cent.

October's employment statistics, while modestly positive, reflect a slow and steady economic recovery as interest rates continue to fall. Both public and private sector job growth remained relatively unchanged. Only three of sixteen major Canadian industries had a statistically significant change in employment from the previous month, suggesting that firms may continue waiting for friendlier financing/investment conditions before expanding their workforces.  A steady unemployment rate amid weak but still positive hiring activity doesn't necessarily point to another jumbo cut by the Bank of Canada, though the Bank's outlook likely got a little more volatile given the results of the US election.  How the Bank interprets the potential ramifications of a new Trump administration on the Canadian economy, along with incoming data on October inflation, may push the Bank toward more aggressive rate cuts. Current odds in financial markets are slightly tilted toward a 50-basis point cut in December. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Quick Snapshot of METRO VANCOUVER'S October 2024 MLS Sales

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver* is $1,172,200. This represents a 1.9 per cent decrease over October 2023 and a 0.6 per cent decrease compared to September 2024.

Specifically:

- The benchmark price for detached homes increased 0.3% from Oct 2023 and decreased 1.0% from Sep 2024.

- The benchmark price for townhouses/attached decreased 1.6% from Oct 2023 and decreased 0.6% from Sep 2024.

- The benchmark price for apartment/condos decreased 0.3% from Oct 2023 and decreased 0.7% from Sep2024.

*Areas covered by the Real Estate Board of Greater Vancouver include: Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.

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After months of tracking approximately twenty per cent below the ten-year seasonal average, Metro Vancouver home sales surged more than 30 per cent year-over-year in October:

The Greater Vancouver REALTORS® (GVR) reports that residential sales registered on the Multiple Listing Service® (MLS®) in the region* totalled 2,632 in October 2024, a 31.9 per cent increase from the 1,996 sales recorded in October 2023. This was 5.5 per cent below the 10-year seasonal average (2,784).

“Typically, reductions to mortgage rates boost demand, and the strong October sales numbers suggest buyers may finally be responding to lower borrowing costs after waiting on the sidelines for months,” Andrew Lis, GVR’s director of economics and data analytics said. “To some market watchers, this rebound may come as a surprise, but with four consecutive rate cuts from the Bank of Canada – and more likely to come on the horizon – it was only a matter of time until signs of renewed strength in demand showed up.”

There were 5,452 detached, attached and apartment properties newly listed for sale on the MLS® in Metro Vancouver in October 2024. This represents a 16.9 per cent increase compared to the 4,664 properties listed in October 2023. This was 20 per cent above the 10-year seasonal average (4,545).

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 14,477, a 24.8 per cent increase compared to October 2023 (11,599). This total is also 26.2 per cent above the 10-year seasonal average (11,475).

Across all detached, attached and apartment property types, the sales-to-active listings ratio for October 2024 is 18.8 per cent. By property type, the ratio is 13.4 per cent for detached homes, 22.5 per cent for attached, and 22.2 per cent for apartments. Analysis of the historical data suggests downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“While the strength in October's numbers is encouraging, one data point does not make a trend," Lis said. "Recent data shows that market conditions have been decidedly balanced, with prices easing over the past few months. With the recent uptick in sales however, the attached and apartment segments are now tilting toward a seller’s market with the detached segment not far behind, suggesting the recent period of price moderation may be nearing an end."

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is $1,172,200. This represents a 1.9 per cent decrease over October 2023 and a 0.6 per cent decrease compared to September 2024.

Sales of detached homes in October 2024 reached 724, a 25.5 per cent increase from the 577 detached sales recorded in October 2023. The benchmark price for a detached home is $2,002,900. This represents a 0.3 per cent increase from October 2023 and a 1 per cent decrease compared to September 2024.

Sales of apartment homes reached 1,393 in October 2024, a 33.4 per cent increase compared to the 1,044 sales in October 2023. The benchmark price of an apartment home is $757,200. This represents a 1.6 per cent decrease from October 2023 and a 0.6 per cent decrease compared to September 2024.

Attached home sales in October 2024 totalled 501, a 40.7 per cent increase compared to the 356 sales in October 2023. The benchmark price of a townhouse is $1,108,800. This represents a 0.4 per cent increase from October 2023 and a 0.9 per cent increase compared to September 2024.

*Areas covered by the Real Estate Board of Greater Vancouver include: Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.

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Canadian Monthly Economic Growth (August 2024) – October 31st, 2024

Canadian real GDP was essentially unchanged in August, following a 0.1 per cent increase in July. Service-producing industries grew by 0.1 per cent, while goods-producing industries fell by 0.4 per cent, reaching their lowest level since December 2021. Manufacturing was the largest detractor from growth for August, driven by both durable (-1.0 per cent) and non-durable goods (-1.4 per cent). The public sector saw its eighth consecutive month of growth (0.2 per cent), while utilities contracted by 1.9 per cent after three consecutive months of growth. Retail trade rose for the second month in a row by 0.6 per cent, while mining, quarrying, and oil and gas extraction (+0.6 per cent), and finance and insurance (+0.5 per cent) also contributed to growth. Rail lockouts resulted in a 7.7 per cent decline in rail transportation, causing a 0.3 per cent decline in the overall transportation and warehousing sector for August. Finally, GDP for real-estate offices and agents was up 0.7 points month-over-month. Preliminary estimates suggest that real GDP grew by 0.3 per cent in September, contributing to a 0.2 per cent estimate for GDP growth in the third quarter of 2024.

Despite exhibiting growth in 12 of 20 overall industries, the Canadian economy remained at virtually the same level of output compared to July. These findings further justify the Bank of Canada's decision to cut the overnight rate by 50 basis points earlier this month. However, a strong preliminary estimate for September suggests a potentially stronger economy in the final quarter of 2024 amidst the Bank's cutting cycle. Steady, positive monthly growth, accompanied by headline CPI settling around its 2% target range, would suggest a return to a more gradual pace of rate cuts by the Bank of Canada, though the door remains open to more aggressive moves if October inflation and jobs data show continued weakness.

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Retail Sales (August 2024) – October 25th, 2024

Canadian retail sales rose 0.4 per cent to $66.6 billion in August from the previous month. Compared to the same time last year, retail sales are also up by 1.4 per cent. However, core retail sales, which exclude gasoline and automobile items, were down 0.4 per cent month-over-month. In volume terms, adjusted for rising prices, retail sales rose 0.7 per cent in August.

Retail sales in British Columbia were down 1.0 per cent in August month-over-month, while down 0.6 per cent compared to the same time last year. In the CMA of Vancouver, retail sales were down 1.4 per cent from the prior month and unchanged from August 2023.

August's retail sales show some positive signs in Canadian consumption while highlighting underlying weaknesses that have remained a challenge throughout 2024. On one hand, headline sales rose for a second consecutive month, and we saw the largest year-over-year gain since April. However, contracting core retail sales—which exclude volatile items—demonstrate an unsatisfactory level of consumer spending across goods and services, supporting the Bank of Canada's decision to cut rates by 50 basis points earlier this week. Moving toward their next meeting, the Bank will monitor whether retail activity (headline and core), GDP growth, and employment strengthen. Positive trends in these areas, coupled with CPI inflation returning to its midpoint, would propel the Bank back onto its regular trajectory of 25 basis point cuts until reaching their neutral range. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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The Bank of Canada lowered its overnight policy rate by 50 basis points this morning from 4.25 per cent to 3.75 per cent.  In the statement accompanying the decision, the Bank noted that the economy continues to operate in excess supply as the labour market has softened and economic growth has been modest. However, the Bank does expect growth to strengthen rising from 1.2% this year to 2.1% in 2025. On inflation, the Bank stated that inflationary pressures are no longer broad-based and that consumer and business inflation expectations have largely normalized. The Bank expects inflation to remain close to its 2% target with upward pressures from shelter costs diminishing.  

While the Bank normally reserves movements larger than 25 basis points for more urgent times, with inflation considerably undershooting the Bank’s forecast, monetary policy was about 40bps tighter in real terms than desired and it seems like the Bank preferred to catch-up all at once rather than risk falling further behind the curve.  However, it has also risked setting a new precedent and will have to communicate its intentions going forward very carefully to avoid a market over-reaction. We expect that the Bank will be cutting again in December, though the Bank did not necessarily provide any hints on whether to expect a return to 25 basis point reductions or another jumbo-sized cut. Rather, the Bank simply cited the 50 basis point reduction was to support economic growth and to keep inflation in its preferred range of 1-3%, which is to say it did not say much at all. If inflation continues to fall from its current 1.6% pace or if the economy is looking increasingly weak, it would seem there is now a precedent for more aggressive cuts to the Bank's policy rate.  Interestingly, Canadian 5-year bond yields (the key benchmark for 5-year fixed mortgage rates) have ticked slightly higher in recent days, back above 3%. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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British Columbia's September 2024 MLS sales

The British Columbia Real Estate Association (BCREA) reports that 5,579 residential unit sales were recorded in Multiple Listing Service® (MLS®) systems in September 2024, up a little under 1 per cent from September 2023. The average MLS® residential price in BC in September 2024 was down 2.8 per cent at $942,969 compared to an average price of $969,907 in September 2023.

The total sales dollar volume was $5.3 billion, a 2.1 per cent decline from the same time the previous year. BC MLS® unit sales were 25 per cent lower than the ten-year average for September.

“Thus far, falling mortgage rates have not had the expected impact on home sales,” said BCREA Chief Economist Brendon Ogmundson. “That said, there has been interesting regional variation with markets on Vancouver Island and in the North recording more historically normal activity while the Lower Mainland and parts of the Interior lag behind.”

Year-to-date, BC residential sales dollar volume is down 3.2 per cent to $56 billion, compared with the same period in 2023. Residential unit sales are down by 4.1 per cent year-over-year at 57,069 units, while the average MLS® residential price is up 1 per cent to $981,393.

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Inflation (September 2024) – October 15th, 2024

Canadian prices, as measured by the Consumer Price Index (CPI), rose 1.6 per cent on a year-over-year basis in September, down from a 2.0 per cent increase in August. This marks the slowest year-over-year increase since February 2021. Month-over-month, on a seasonally adjusted basis, CPI was unchanged in September. The deceleration in headline CPI was driven by a 10.7 per cent decrease in gasoline prices in September. This drop is largely attributed to lower crude oil prices due to pessimistic outlooks on economic growth, coupled with lower costs associated with switching to winter blends. Excluding gasoline, the CPI rose 2.2 per cent in September, matching August's increase. Mortgage interest costs were up 16.7 per cent, and rent was up 8.2 per cent from last September, both decreasing from August's numbers of 18.8 and 8.9 per cent, respectively. Overall, shelter costs rose 5.0 per cent year-over-year in September, down from 5.3 per cent in August. Finally, goods costs fell 1.0 per cent, while services costs rose 4.0 per cent year-over-year. In BC, consumer prices rose 2.0 per cent year-over-year, down from 2.4 per cent in August. The Bank of Canada's preferred measures of median and trimmed inflation, which strip out volatile components, remained unchanged from August at 2.3 and 2.4 per cent year-over-year, respectively. 
 
Canada's inflation report for September strongly resembles the patterns of August's report, with different takeaways. Similar to August, the stark dropoff in September's headline CPI is driven by sharp decreases in gasoline prices, with CPI ex-gasoline remaining at 2.2 per cent. Nonetheless, this downward pressure is a function of concerns regarding future economic conditions, thus serving as a proxy for investor/consumer expectations. Moreover, 9 out of 11 special aggregate CPIs published by Statistics Canada fell from August's levels, suggesting that consumption levels are weaker than expected by the Bank of Canada. Despite median and trimmed CPI remaining at 2.3 and 2.4 per cent, the strong dip in headline CPI will raise concerns that inflation is decelerating too quickly due to a weakening economy. Taken together, September's inflation report significantly increases the probability of a 50 basis point cut next week, in hopes of reigniting the economy for our final quarter. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Employment (September 2024) – October 11th, 2024

Canadian employment rose by 0.2 percent from the previous month, growing by 47,000 jobs to 20.582 million in September. Both unemployment and employment rates fell by 0.1 points to 6.5 per cent and 60.7 per cent, respectively. Average hourly wages rose 4.6 per cent year-over-year to $35.59 last month, while total hours worked were up 1.2 per cent from September of the previous year.

Employment in B.C. fell 0.6 per cent to 2.821 million with a loss of 18,000 jobs in September, marking the fifth consecutive month of provincial job losses. Employment in Metro Vancouver rose 0.2 per cent to 1.587 million in September. The unemployment rate in B.C. rose by 0.2 points to 6 per cent. On a similar trend, Vancouver's unemployment rate rose by 0.4 points year-over-year to 6.7 per cent.

September's employment statistics are a beginning sign of a rebounding labour market, with the unemployment rate ticking downward for the first time since January. Moreover, headline job growth is driven by strong private sector expansion (+61,000 jobs), suggesting that firms are willing to incur greater costs amidst continually improving borrowing conditions from the Bank's cutting cycle. Overall, these numbers indicate a slight economic bounceback, which may reduce the odds of a 50 basis point cut later this month. However, September's CPI report will provide more clarity on the economy's expectations of the Bank of Canada's announcements moving forward.

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Home sales registered on the MLS® in Metro Vancouver* declined 3.8 per cent year over year in September, suggesting recent reductions in borrowing costs are having a limited effect in spurring demand so far.

Greater Vancouver REALTORS® (GVR)2 reports that residential sales in the region totalled 1,852 in September 2024, a 3.8 per cent decrease from the 1,926 sales recorded in September 2023. This was 26 per cent below the 10-year seasonal average (2,502).

“Real estate watchers have been monitoring the data for signs of renewed strength in demand in response to recent mortgage rate reductions, but the September figures don’t offer the signal that many are watching for,” Andrew Lis, GVR’s director of economics and data analytics said. “Sales continue trending roughly 25 per cent below the ten-year seasonal average in the region, which, believe it or not, is a trend that has been in place for a few years now. With the September data, sales are now tracking slightly below our forecast however, but we remain optimistic sales will still end 2024 higher than 2023.”

There were 6,144 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in September 2024. This represents a 12.8 per cent increase compared to the 5,446 properties listed in September 2023. This was also 16.7 per cent above the 10-year seasonal average (5,266).

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 14,932, a 31.2 per cent increase compared to September 2023 (11,382). This is 24.2 per cent above the 10-year seasonal average (12,027).

Across all detached, attached and apartment property types, the sales-to-active listings ratio for September 2024 is 12.8 per cent. By property type, the ratio is 9.1 per cent for detached homes, 16.9 per cent for attached, and 14.6 per cent for apartments.

Analysis of the historical data suggests downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months. “With some buyers choosing to stay on the sidelines, inventory levels have sustained the healthy gains achieved over the course of this year, providing much more selection to anyone searching for a home,” Lis said.

With all this choice available, prices have trended sideways for the past few months. The September figures, however, are now showing modest declines across all segments on a month over month basis. This downward pressure on prices is a result of sales not keeping pace with the number of newly listed properties coming to market, which has now put the overall market on the cusp of a buyers’ market. With two more policy rate decisions to go this year, and all signs pointing to further reductions, it’s not inconceivable that demand may still pick up later this fall should buyers step off the sidelines.”

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,179,700. This represents a 1.8 per cent decrease over September 2023 and a 1.4 per cent decrease compared to August 2024.

Sales of detached homes in September 2024 reached 516, a 9.8 per cent decrease from the 572 detached sales recorded in September 2023. The benchmark price for a detached home is $2,022,200. This represents a 0.5 per cent increase from September 2023 and a 1.3 per cent decrease compared to August 2024.

Sales of apartment homes reached 940 in September 2024, a 4.9 per cent decrease compared to the 988 sales in September 2023. The benchmark price of an apartment home is $762,000. This represents a 0.8 per cent decrease from September 2023 and a 0.8 per cent decrease compared to August 2024.

Attached home sales in September 2024 totalled 378, a 7.4 per cent increase compared to the 352 sales in September 2023. The benchmark price of a townhouse is $1,099,200. This represents a 0.5 per cent decrease from September 2023 and a 1.8 per cent decrease compared to August 2024.

*Areas covered by the Real Estate Board of Greater Vancouver include: Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.

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Canadian Monthly Economic Growth (July 2024) – September 27th, 2024

Canadian real GDP grew 0.2 percent in July, following a marginal increase in June. Service-producing industries grew by 0.2 per cent, slightly outpacing goods-producing industries (0.1 per cent). Retail trade (1.0 per cent) contributed the most to overall growth in July. The public sector saw its seventh consecutive month of growth (0.3 per cent), while utilities rose for a third consecutive month by 1.3 per cent. Manufacturing growth (0.3 per cent) was driven by gains in non-durable goods production (1.3 per cent), while wildfires drove contraction in multiple industries, including transportation and warehousing (-0.4 per cent) and accommodation services (-2.0 per cent). GDP for real-estate offices and agents was down 0.17 points month-over-month. Lastly, the construction sector contracted by 0.4 points, representing the largest drag to growth in July. Preliminary estimates suggest that real GDP in the Canadian economy was largely unchanged in August.

Canada's economy expanded at a reasonable rate that surpassed analyst expectations in July, following the anticipated 25 basis point cut from the Bank of Canada earlier this month. As the Bank's next meeting draws closer, markets will closely follow Canadian employment and inflation reports. Continually weakening labour markets coupled with further decreases in inflation may suggest that a 50-basis point cut is required in October to stimulate the economy.

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Housing Starts (August 2024) – September 18th, 2024

Canadian housing starts fell 22 per cent to 217,405 units in August at a seasonally adjusted annual rate (SAAR). Starts were down 12.1 per cent from the same month last year. Single-detached housing starts were 3 per cent higher from last month at 55,851 units, while multi-family and other starts fell 28 per cent to 161,555 units (SAAR). 

In British Columbia, starts fell 30 per cent from last month to 33,820 units SAAR in all areas of the province. In areas in the province with 10,000 or more residents, single-detached starts rose 6 per cent to 4,678 units while multi-family starts fell 35 per cent to 26,823 units compared to July. Starts in the province were 30 per cent below the levels from August 2023. Compared with last year, year-to-date starts are up by 63 per cent in Kelowna and 26 per cent in Abbotsford. Year-to-date starts are down by 20 per cent in Vancouver, 15 per cent in Nanaimo, and by 8 per cent in Victoria. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Inflation (August 2024) – September 17th, 2024

Canadian prices, as measured by the Consumer Price Index (CPI), rose 2.0 per cent on a year-over-year basis in August, down from a 2.5 per cent increase in July. This marks the slowest year-over-year increase since February 2021. Month-over-month, on a seasonally adjusted basis, CPI rose by 0.1 per cent in August. The deceleration in headline CPI was driven by a 5.1 per cent decrease in gasoline prices in August. This drop is largely attributed to base-year effects as well as lower crude oil prices due to lower demand in China and concerns regarding the American economy. Excluding gasoline, the CPI rose 2.2 per cent in August, a fall from 2.5 per cent in July. Mortgage interest costs were up 18.8 per cent, and rent was up 8.9 per cent from last August. Despite steadily decreasing year-over-year growth rates, mortgage interest costs have been the largest contributor to headline CPI since December 2022. Overall, shelter costs rose 5.3 per cent year-over-year in August, down from 5.7 per cent in July. Finally, goods costs fell 0.7 per cent while services costs rose 4.3 per cent year-over-year. In BC, consumer prices rose 2.4 per cent year-over-year, down from 2.8 per cent in July. The Bank of Canada's preferred measures of median and trimmed inflation,which strip out volatile components, fell to 2.3 and 2.4 per cent year-over-year in August, respectively. 
 
Canada's August inflation report marks a significant milestone for the national economy, with headline CPI reaching the midpoint of the Bank of Canada's target range. Despite some downward pressure from base-year effects on gasoline, the prices for several major components of inflation ticked downward nationwide. Moreover, CPI-median and CPI-trim continue declining towards the midpoint of their target ranges. Taken together, August's inflation report bolsters the likelihood of a fourth consecutive rate cut from the Bank of Canada in October. Barring weaker-than-expected monthly GDP and employment, we can expect this cut to be 25 basis points. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Employment (August 2024) – September 6th, 2024

Canadian employment was largely unchanged from the previous month, growing by 22,000 jobs to 20.536 million in August. The unemployment rate rose 0.2 points to 6.6 per cent, while the employment rate fell 0.1 percentage points to 60.8 per cent. This was the fourth consecutive month of declining employment rates with minimal changes to overall employment. Average hourly wages rose 5 per cent year-over-year to $35.16 last month, while total hours worked were up 1.4 per cent from August of the previous year.

Employment in B.C. fell 0.2 per cent to 2.839 million with a loss of 4,300 jobs in August, marking the fourth consecutive month of provincial job losses. Employment in Metro Vancouver fell 1.7 per cent to 1.584 million in August. The unemployment rate in both B.C. and Vancouver rose by 0.5 points year-over-year to 5.8 per cent and 6.3 per cent, respectively. 

Overall, these employment statistics for August are indicative of a continuing cooling of the labour market. Relatively flat employment and steadily rising unemployment support the notion of another 25-basis point cut from the Bank of Canada in October.

Copyright British Columbia Real Estate Association. Reprinted with permission.

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The Bank of Canada lowered its overnight lending rate this morning by 25 basis points from 4.5 per cent to 4.25 per cent. In the statement accompanying the decision, the Bank noted that growth in the Canadian economy was slightly stronger than expected in the second quarter but showed signs of softer activity through the summer.  Inflation is evolving largely as expected, and the Bank judges the economy to be in excess supply which should put further downward pressure on price growth. 

Focus has shifted from whether the Bank of Canada will lower rates, to how quickly, with some analysts even looking for larger 50bps cuts in the future. The trends to watch over coming months are the state of the Canadian labour market and whether inflation is following the Bank of Canada's forecast. As long as price growth isn't deviating from expectations, and employment is not significantly weaker, we should see continued rate cuts at an orderly 25bps pace until the Bank reaches its neutral range between 2.25 and 3.25 per cent in 2025. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Home sales registered on the MLS® in Metro Vancouver* remained below their ten-year seasonal averages in August as summer holidays come to a close:

The Greater Vancouver REALTORS® (GVR) reports that residential sales in the region totalled 1,904 in August 2024, a 17.1 per cent decrease from the 2,296 sales recorded in August 2023. This total was also 26 per cent below the 10-year seasonal average (2,572).

“From a seasonal perspective, August is typically a slower month for sales than June or July. In this respect, this August has been no different,” Andrew Lis, GVR’s director of economics and data analytics said. “With that said, sales remain in a holding pattern, trending roughly 20 per cent below their 10-year seasonal average, which suggests buyers are still feeling the pinch of higher borrowing costs, despite two recent quarter percentage point reductions to the policy rate this summer.”

There were 4,109 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in August 2024. This represents a 4.2 per cent increase compared to the 3,943 properties listed in August 2023. This total was 1.7 per cent below the 10-year seasonal average (4,179).

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 13,812, a 37 per cent increase compared to August 2023 (10,082). This total is also 20.8 per cent above the 10-year seasonal average (11,432).

Across all detached, attached and apartment property types, the sales-to-active listings ratio for August 2024 is 14.3 per cent. By property type, the ratio is 9.6 per cent for detached homes, 18 per cent for attached, and 17.2 per cent for apartments.

Analysis of the historical data suggests downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“Buyers’ hesitancy to enter the market, paired with new listing activity on the part of sellers that is in line with historical averages, has allowed inventory to accumulate for a number of months and has moved the market firmly into balanced conditions,” Lis said.

“With the Bank of Canada’s decision to reduce the policy rate today by another quarter percentage point, and with September being a month that typically sees an increase in sales from a seasonal perspective, the fall market is set up to bring more buyers off the sidelines. We will watch the upcoming September data to see whether they decide to show up.”

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,195,900. This represents a 0.9 per cent decrease over August 2023 and a 0.2 per cent decrease compared to July 2024.

Sales of detached homes in August 2024 reached 509, a 13.9 per cent decrease from the 591 detached sales recorded in August 2023. The benchmark price for a detached home is $2,048,400. This represents a 1.8 per cent increase from August 2023 and a 0 per cent decrease compared to July 2024.

Sales of apartment homes reached 1,012 in August 2024, a 20.3 per cent decrease compared to the 1,270 sales in August 2023. The benchmark price of an apartment home is $768,200. This represents a 0.1 per cent decrease from August 2023 and a 0 per cent decrease compared to July 2024.

Attached home sales in August 2024 totalled 370, a 12.3 per cent decrease compared to the 422 sales in August 2023. The benchmark price of a townhouse is $1,119,300. This represents a 0.8 per cent increase from August 2023 and a 0.5 per cent decrease compared to July 2024.

*Areas covered by the Real Estate Board of Greater Vancouver include: Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.

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Canadian Economic Growth (Real GDP Q2 2024) – August 31st, 2024

Canadian real GDP was largely unchanged in June, following a 0.1% increase in May. Goods-producing sectors fell 0.4 per cent, the largest decrease since December 2023. Meanwhile, services-producing industries were up 0.1 per cent, marking a third consecutive monthly increase. Manufacturing (-1.5 per cent), wholesale trade (-0.7 per cent), and construction (-0.6 per cent) were the main drivers of downward pressure on real GDP growth. These decreases were offset by growth in the public sector, finance and insurance, utilities, and real-estate sectors. Preliminary estimates suggest that real GDP by industry was also largely unchanged in July.

Real GDP growth in the second quarter of 2024 registered 2.1 per cent at an annualized rate from the prior quarter, rising for the third consecutive quarter. Growth was driven by increased government spending (+1.5 per cent) and business investment in machinery (+6.5 per cent), while household spending was essentially flat (+0.2 per cent) in spite of strong wage growth. As a result, the household savings rate rose to 7.2 per cent. Rapid population growth outpaced modest gains in household spending, leading to a 0.4 per cent decline in per capita household expenditures. Resulting GDP per capita growth was down 0.1 per cent in Q2 and marked a fifth consecutive quarterly decline. Housing investment fell 1.9 per cent in the second quarter, primarily due to lower investment in new construction (-1.6 per cent). Overall, residential construction has fallen for eight of the last nine quarters.

Fairly strong GDP growth in the second quarter, which surpassed the Bank of Canada's expectations, is largely driven by public sector expenditure. However, Canadian GDP per capita continues to struggle amidst rapid population growth. This comes in the context of continually improving inflation, which hit 2.5 per cent last month, with price appreciation being largely driven by high shelter costs. Employment has continued to soften from the previous quarter, with the unemployment rate hitting 6.4 per cent last month. Considering these components, markets expect the Bank of Canada to continue cutting rates during its announcement next week. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Retail Sales (June 2024) – August 23rd, 2024

Canadian retail sales fell 0.3 per cent to $65.7 billion in June. Excluding volatile items, sales were up 0.4 per cent on a month-over-month basis. In volume terms, adjusted for rising prices, retail sales rose 0.1 per cent in June, while quarterly sales fell by 0.3 per cent. Overall, retail sales were down 0.5 per cent in the second quarter of 2024.

Retail sales in British Columbia were nearly unchanged (+0.0043 per cent) in June and fractionally lower (-0.0015 per cent) compared to the same time last year. In the CMA of Vancouver, retail sales were up 0.4 per cent from the prior month and rose 2.6 percent from June 2023.

These statistics from June contribute to an overall weakening national trend in retail sales over the past several months, as characterized by decreased quarterly volume. Overall, this pattern supports the argument for a third rate cut by the Bank of Canada in September to promote more economic activity.

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Canadian Inflation (July 2024) – August 20th, 2024

Canadian prices, as measured by the Consumer Price Index (CPI), rose 2.5 per cent on a year-over-year basis in July, down from a 2.7 per cent increase in June. Month-over-month, on a seasonally adjusted basis, CPI rose by 0.3 per cent in July. The deceleration in headline CPI was widespread across sectors, primarily driven by declining prices on electricity, passenger vehicles, and travel tours. Excluding gasoline, the CPI rose 2.5 per cent in July. Gasoline placed further upward pressure on inflation in July, with a year-over-year growth rate of 1.9 per cent compared to 0.4 per cent in June. Downward pressure from electricity and other factors drove shelter costs down from 6.2 per cent in June to 5.7 per cent in July year-over-year. Mortgage interest costs were up 21 per cent and rent was up 8.5 per cent from last July. Finally, durable goods costs fell 1.7 per cent while services costs rose 4.4 per cent year-over-year. In BC, consumer prices rose 2.8 per cent year-over-year, up from 2.6 per cent in June. The Bank of Canada's preferred measures of core inflation, which strip out volatile components, fell to between 2.4 and 2.7 per cent year-over-year in July. 

 Canada's inflation report for July continued the positive overall trends in June, with headline CPI reaching its lowest level since March 2021. This was achieved in part due to declines in nearly all travel-related services in July year-over-year. However, this is largely a base-year effect, as July 2023 experienced soaring travel-related prices due to it being the first summer without restrictions related to the COVID-19 pandemic.  Moreover, CPI-median and CPI-trim continue declining towards the mid-point of the Bank of Canada's target range. Taken together, July's inflation report bolsters the likelihood of a third consecutive rate cut from the Bank of Canada in September. 

Copyright British Columbia Real Estate Association. Reprinted with permission.

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Quick Snapshot of METRO VANCOUVER'S July 2024 MLS Sales

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver* is currently $1,197,700. This represents a 0.8% decrease from June 2023 and a 0.8% decrease from June 2024.

Specifically:

- The benchmark price for detached homes increased 2.1% from Jul 2023 and decreased 0.6% from Jun 2024.

- The benchmark price for townhouses/attached increased 1.4% from Jul 2023 and decreased 1.2% from Jun 2024.

- The benchmark price for apartment/condos decreased 0.3% from Jul 2023 and decreased 0.7% from Jun 2024.

*Areas covered by the Real Estate Board of Greater Vancouver include: Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.

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