The number of areas in the Greater Vancouver Area that moved into a buyer’s market increased month-over-month. Of the 21 areas that make up the GVA, 52% are now in a buyer’s market, compared to 43% from last month.
This trend may be more bad news for sellers in the GVA, particularly sellers who haven’t adjusted their expectations of high prices were part of the norm in the 2017 market.
Still, a small minority of neighbourhoods could still surprise buyers. Of the 344 neighbourhoods analyzed by Zolo, 39 of those neighbourhoods — or just over 11% of GVA communities — were still in a seller’s market. Keep in mind, however, that sales activity has declined quite dramatically across the Lower Mainland, so many of the markets in seller’s territory were simply because so few single-family homes were listed for sale within the month of September.
For a better understanding of the top areas and neighbourhoods for buyers and sellers, see our Top Value lists below, or consider this overall snapshot of the current Greater Vancouver Area housing market:
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Key takeaway: Buyers can use this market to really examine and think about their purchase
When markets to a balanced market, both buyers and sellers must be ready to proceed but can continue with their due diligence — like getting a proper home inspection — without fear of missing out. Things change even more in a buyer’s market. With the upper hand, buyers can now take time to really shop around and compare before doing their due diligence. For a few good bets, consider the following (ranked based on the market absorption ratio or sales-to-listings ratio):
5 Top Areas in the GVA that Favour Single-Family Home Buyers
However, as we know, real estate is a very local business. While one neighbourhood or street can seem on fire, another can sit by on the sidelines. For that reason, we also examined the 334 neighbourhoods that make up Greater Vancouver’s real estate single-family housing marketplace. Twenty-three of these neighbourhoods did not experience any sales activity when it comes to single-family homes. Another 38 of these neighbourhoods are in a seller’s market, while 64 are in a balanced market. The remaining 216 neighbourhoods are in a buyer’s market, although 102 of these neighbourhoods had so few sales that the verdict is still out on whether or not they’ll remain in a buyer’s market or tip over into a balanced market.
To help buyers narrow down the best neighbourhoods, we examined those areas with the lowest market absorption rate.
10 Top Neighbourhoods in the GVA for Buyers of Single-Family Homes
- Queensborough, New Westminster
- Maillairdville, Coquitlam
- Collingwood, Vancouver East
- Ironwood, Richmond
- Fraserview, Vancouver East
- Cedar Hills, Surrey
- British Properties, West Vancouver
- South Granville, Vancouver West
- Victoria, Vancouver East
- Mackenzie Heights, Vancouver West
What should seller’s expect?
In September’s report, just over 21% of the GVA was in a seller’s market for single-family homes. This month, a big fat 0% of the GVA areas favour sellers. This is a big wake-up call for those selling single-family homes in the Lower Mainland. It’s also why there are no top five areas that “favour” sellers. Instead, there are the top 5 balanced markets in the GVA, as well as the top 10 neighbourhoods that still currently favour single-family home sellers in October 2018 (after omitting neighbourhoods that registered as seller’s markets but had so few sales that, statistically, they could shift into a balanced market at any time).
5 Top Areas in the GVA that Favour Sellers
10 Top Neighbourhoods in the GVA for Single-Family Home Sellers
- Sapperton, New Westminster
- Citadel, Port Coquitlam
- Hockaday, Coquitlam
- Eagle Ridge, Coquitlam
- Chineside, Coquitlam
- Ranch Park, Coquitlam
- Queens Park, New Westminster
- Fort Langley, Langley
- Lower Mary Hill, Port Coquitlam
- Holly, Ladner
For comparison, check out last month’s GVA Market Report for condos and townhouses.
Why use active listings versus new listings?
We examined the GVA market for single family homes using the sales-to-active listings ratio and not sales-to-new-listings (SNLR) ratio. This means we compare demand — all homes sold within a given period of time — with current supply (all homes available for sale within a given period of time), without omitting stale listings — homes that weren’t new listings that month, but are still available because they haven’t sold, yet.
The sales-to-active listing ratio gives a more realistic and comprehensive view of supply and demand for a particular region over a specified period of time — commonly referred to as the market absorption rate. It’s also why the sales-to-active-listings ratio is also known as the Market Absorption Rate.
Expressed as a percentage, the sales-to-active ratio (or MAR – Market Absorption Rate) is calculated by taking the total number of sales at the end of a given time period (in this case, a calendar month) and dividing it by the total number of active listings available during the same time period. The higher the ratio, the more demand for the property and the more opportunity a seller will have to attract a higher price for their home for sale. A lower ratio indicates slower sales and the potential for falling house prices. A balanced market is when the supply of housing meets the demand from potential buyers. In a balanced market, sellers usually accept reasonable, close-to-list-price offers; homes typically stay on the market for close to the average number of days and prices remain fairly stable within the region.