Vancouver's real estate scene is seeing some changes. Last month, Vancouver experienced a significant rise in housing inventory with 5,446 new listings, marking a 28.4% increase from September 2022. Sales in Vancouver also increased by 13.2% from the same month last year, but they're still lagging behind the seasonal average of the past decade. In fact, sales saw a decline of 16.1% compared to August. Although sales might appear to be on the upswing year over year, it's mainly due to a particularly slow September in 2022.

On a positive note, Vancouver's house prices have shown an upward trend compared to last year. The benchmark home price in Metro Vancouver now stands at around $1.2 million, marking a 4.4% increase from the previous year. However, there's been a slight 0.4% decrease since August.

For context, Toronto's housing market is somewhat similar, but with a bit more of a challenge. Sales there have seen a decline; even as new listings have surged. Their average price has risen to about $1.1 million, but like Vancouver, the market is characterized by weak sales and an inventory that is potentially pushing prices down.

Most industry professionals believe the key determinant of the housing market's trajectory is interest rates. Other factors, such as immigration, might not play a significant role until the economy stabilizes. The dominant influence of interest rates on both potential home buyers and those looking to sell. The fluctuations in interest rates also impact the pace of new construction.

Looking ahead, don’t be too optimistic about the federal government's upcoming budget providing a significant boost to the housing market. The main obstacle remains the lack of supply in all housing categories and current interest rates. On a related note, a reconsideration of Ottawa's ambitious immigration targets, suggests that the housing market is finding it challenging to sustain the rapid growth.

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Source: RE/MAX Michael Cowling and Associates Realty, Michael Cowling

Photo Source: Financial Post