October home sales plummet in Metro Vancouver

VANCOUVER (NEWS 1130) – It appears the latest numbers from the Real Estate Board of Greater Vancouver is simply further proof that the 15 per cent foreign buyers tax is having a major impact on the local housing market.

The agency says Vancouver-area home sales continued to plunge in October, even as average prices kept rising.

The board says sales dropped 38.8 per cent from a year earlier, totalling 2,233. The industry group says sales were 15 per cent below the 10-year average for October. Single-detached houses took the biggest hit, plunging 54.6 per cent, while apartment-style condos were down 23.7 per cent.

“Changing market conditions compounded by a series of government interventions this year have put home buyers and sellers in a holding pattern,” says Board President Dan Morrison. “Potential buyers and sellers are taking a wait-and-see approach to try and better understand what these changes mean for them.”

However, prices continued to rise, with the adjusted average or “benchmark” price for all types of homes rose 24.8 per cent and topped $919,000. “While sales are down across the different property types, it’s the detached market that’s seen the largest reduction in home buyer demand in recent months,” explains Morrison. “It’s important to work with your local Realtor to help you navigate today’s changing trends.”

The price trend on a month-over-month basis remains flat to slightly lower. Detached homes were down 1.4 per cent from September to $1.54 million while apartments rose 0.3 per cent to an average of $512,000.

UBC Housing Economist Tom Davidoff says it’s common to see a lag between sales and price slow downs.

“People want to sell their homes for what the last home sold for so prices are going to be sticky even if we’re in a persistent decline.”

He believes we will see the true effect of the 15 per cent foreign buyer tax on prices by spring time.