In Vancouver, consumer demand for condominium units and townhouses has significantly outpaced the desire for free-standing homes. The MLS Home Price Index benchmark price of condos increased by 18.5 per cent compared to July 2016, up to $616,000, and the benchmark price for townhouses grew 11.9 per cent over the past year, up to $763,700.
What is driving gains in the condominium and townhouse market?
Two factors: affordability and inventory.
Although the average price of homes in BC is lower than last year, a closer look at the data reveals the composite of homes being sold has shifted to smaller free-standing homes, condos, and townhouses. BCREA economist Brendon Ogmundson attributed this shift to a pronounced need for more affordable residential real estate along with short supply.
“(The) supply of homes available for sale has not recovered and is still declining in many markets around the province,” says Ogmandson.
The lack of supply is also very apparent in Vancouver’s apartment and townhouse market. Jill Oudil, president of the Real Estate Board of Greater Vancouver said in her recent CBC News interview “detached home listings have increased every month this year, while the number of condominiums for sale has decreased each month since February.”
What do these trends mean for condominium and townhouse prices here in Vancouver?
Our economic fundamentals remain strong, the climate is delightful, inventory is low, and many more people want to live here. We predict a seller’s market and rising prices for quite some time to come.