Vancouver home sales continue to slip following implementation of foreign buyers’ tax

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Sales of existing homes in Vancouver fell 3.4% in November and were down 37.4% year-over-year, according to data released December 15 by both the British Columbia Real Estate Association and the Canadian Real Estate Association.

“The higher end of the market is still reeling in the wake of the tax on nonresident buyers, which likely had a bigger impact than Ottawa’s rule changes,” Robert Kavcic, senior economist for BMO Financial group said in a note to investors.

“Not coincidentally, benchmark price growth peaked in July at 32.6% year-over-year but has now slowed to ‘just’ 20.5% year-over-year and is now declining outright on a month-to month basis.”

The average sale price for all home types in the city in November was $895,084, down 3.8% year-over-year. Total dollar volume fell 39.8%, reaching $2.02 billion.

Kavcic pointed out that Victoria, which was not affected by the implementation of the foreign buyers’ tax, has seen home sales increase over the period. In the 12 months to November, the total dollar volume of sales increased 34.4% to $359 million, and the average home price jumped 29.2%, reaching $639,871.

The weakness in Vancouver pulled the provincial average down 20.1% compared with November 2015, but the BCREA pointed out that with a total dollar volume of $4.02 billion (down 25.2% year-over-year), sales are now trending toward the 10-year average.

A total of around 89,000 units changed hands in B.C. last month; by comparison, the 10-year average is 83,000 units, and the 15-year average is 85,300 units.

Data released by Teranet yesterday (December 14) showed home sales prices were down 1.3% in the month; there is a discrepancy between this and today’s BCREA and CREA data because Teranet’s data includes repeat sales only.

ecrawford@biv.com

@EmmaHampelBIV

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