June 2020 Vancouver Real Estate Market Update

As we enter into July, we’re now half way through what appears to be a year of chaos. All that’s left to happen is the alien invasion in October/November ….  More relevantly, we’re now a few months on from the height of the pandemic fear. This is particularly important as we’ve now got some good data to go by when it comes to the market trend, in particular a recovery, or if there will be a lack of one!

To briefly summarize the late, April 2020 saw a big drop in both listings and sales. This was the height of the lockdown. May saw us increase in listings and sales quite drastically. Not surprising, considering restrictions were eased and life partially started to work towards our newer version of normal. But none-the-less, listing numbers were up far more than home buyer demand. Basically meaning more was coming to market for sale, than people are buying.

June 2020 comes around and we saw that increase shift to be somewhat more balanced. That’s extremely important as most expected listings to increase, the debate was what would happen with buyer demand? Would it stay low, balance, or increase back to pre-covid numbers.

Although it’s still too early to tell the long term trend from this, June saw us return to more historical levels in Vancouver Real Estate. In fact, when we go by year-over-year we are actually up vs last year (2019).  Very positive news for the market indeed.
As charts are riveting stuff, here is a nice chart for us to dig our teeth into:

The year-on-year is important as constant year-on-year improvements are what dictate the markets we are in as a rule of thumb. BUT let’s not get too far ahead of ourselves. This time last year we were not in a strong market, and we had not seen the turn around start to take effect yet. This didn’t happen until July, so next month's figures will really tell a story as it was the beginning of the turnaround of our market.

For a more simplified look at the market, the sales-to-active listing ratio currently sits at 21.4%. This is very significant as over 20% is what analysts deem as a sellers market. Now this figure has not been at this level long enough to warrant a true sellers market, but it’s the first time we’ve seen it this high since Covid-19 (May 2020 = 15%, April 2020 = 11.8%). 

For those savvy market watchers right now, you’ll notice that buyer demand has been increasing month over month and we are starting to see a trend. May is usually a peak, with June starting a downward trail if you were to look at a line graph. As we can see by the above numbers, the story this year is looking different...

Something positive we’ve noticed from the pandemic though, is people taking more time in pre-qualifying potential homes they are viewing. Showing a property has now typically become the last step after researching photos, floorplans, video, MLS sheets, Documents and more. This is causing buyers to wean out the homes that don’t match their criteria better before arranging viewings. This has resulted in fewer showings overall, but an increase in showing effectiveness as a lot of those showings are now with self pre qualified buyers.

An important note is the lifting of restrictions for tenanted properties. Up until the end of June, tenants could refuse access to their suites and not be evicted, putting a lot of people off from buying property that is occupied by tenants. Now that restrictions have been eased, tenanted properties are once again able to be shown by potential buyers and appropriate notice given (for the right reasons) to vacate the premises.
If you were to ask our opinion, we sit on the side of market activity to increase. We’ve seen a trend forming from April, into May and now June. On top of this, as restrictions ease further, it becomes easier for home buyers to get out there and purchase property.

As always, we appreciate you reading along, watching, listening, or however you are joining us today! For a further breakdown on what happened in Vancouver real estate in June, reach out to us on the contact details below!

Until next week,

Jay Mcinnes
T: 604.771.4606

Ben Robinson
T: 604.353.8523