Strong sales and demand for properties pushed the benchmark Metro Vancouver home price up to $624,000 in May – 4.3% more than a year ago, the Real Estate Board of Greater Vancouver (REBGV) announced June 3.
Detached homes led the way, rising to $966,500, or 5.4% more than a year ago.
Other home classes also rose but to a lesser degree.
Apartment prices, for example, were up 3.2% year-over-year to $377,500 whereas other attached properties had an average price increase of 3.1%, putting the benchmark home price for those homes at $469,100, according to the REBGV.
“There’s more home buyer demand today than at any point over the last three years,” said REBGV president Ray Harris.
Indeed, the fuel that ignited the price hikes was sales that outpaced new listings.
Buyers snapped up 3,286 homes in May, or 14% more than a year ago. New listings, in contrast, rose 5% year-over-year to 5,656.
This meant that a key indicator of market strength, known as the sales-to-active-listings ratio, rose 0.7 percentage points to 20.4%. This is the first time that this ratio has been above 20% since June 2011.
Conventional real estate wisdom is that a market is considered to be a buyers’ market when the sales-to-active-listings ratio is below 13%. A balanced market exists when the ratio is between 13% and about 21%, Harris explained. It is then considered a sellers’ market when the ratio is above 21% for at least a few months, he added.
To get a sense of how much of an upward trajectory the trend-line has been for the sales-to-active-listings ratio, the indicator was as low as 8% in September 2012.
There remains room for sales to accelerate given that last month’s sales were still 6.5% below the 10-year sales average for the month of May.
