I did a market analysis for sales and listing activity for the middle of May and I have had a few emails that have expressed interest in seeing more of the market activity breakdowns.
I thought, just coming into summer where we should be at one of the busiest times of the year, it would be a good to do another analysis and compare it to the last one.
Typically when someone makes an offer and starts the buying process, there is about a two-week delay from offer to when the sale is recorded in the numbers. It usually takes two-weeks for the sale to become legally binding, subjects removed etc. This means the analysis lags behind by a couple weeks.
British Columbia’s real estate market remains a “buyer’s” market, with high inventory and subdued sales activity over the past seven days. The market recorded 722 new listings and 307 sales, yielding a new listings-to-sales ratio of 2.35:1. Total existing listings stand at 10,592, resulting in an existing listings-to-sales ratio of 34.5:1, indicating a slow market pace with significant buyer choice.
Price range breakdown
* Up to $250,000 (743 listings, 19 sales): This segment, with 7% of listings and 6% of sales, has a listings-to-sales ratio of 39.1:1. Low sales reflect limited demand. Likely due to affordability issues, there are many listings to choose from.
* $250,001 – $500,000 (2,185 listings, 70 sales): Accounting for 21% of listings and 23% of sales, this range shows a ratio of 31.2:1. Moderate activity suggests some buyer interest but supply far exceeds demand.
* $500,001 – $1 million (4,743 listings, 164 sales): The most active segment, with 45% of listings and 53% of sales, has a ratio of 28.9:1. This price range remains the market’s core, though sales lag behind inventory.
* $1,000,001 – $2 million (2,261 listings, 47 sales): Representing 21% of listings and 15% of sales, this segment’s ratio of 48.1:1 indicates slower movement, likely due to higher costs and economic caution.
* More than $2 million (660 listings, 7 sales): The luxury market is the weakest, with 6% of listings and 2% of sales, and a ratio of 94.3:1, reflecting minimal demand for high-end properties.
Market dynamics
The new listings-to-sales ratio of 2.35:1 and an existing listings-to-sales ratio of 34.5:1 confirm a buyer’s market, with a sales-to-new-listings ratio below 40%. The $500,001-$1 million range drives most activity but high inventory across all segments gives buyers lots of leverage. Economic uncertainties, including potential U.S. tariffs and affordability challenges, continue to suppress demand, despite Bank of Canada rate cuts since June 2024.
Comparison to previous period
Compared to the prior period, new listings decreased from 947 to 722, while sales increased from 230 to 307, improving the new listings-to-sales ratio from 4.12:1 to 2.35:1. Existing listings grew from 10,075 to 10,592 and the existing listings-to-sales ratio improved from 43.8:1 to 34.5:1, signalling a slight uptick in buyer activity. The $500,001-$1 million segment saw the largest sales increase (117 to 164) and luxury sales ($2 million-plus) rose to seven from two. The entry-level market (up to $250,000) remained stagnant at 19 sales, indicating ongoing weakness.
Outlook
B.C.’s real estate market continues to favour buyers, with high inventory and low sales volumes, particularly in luxury and entry-level segments. The $500,000 to $ million range remains the most resilient but sellers face challenges across the board.
Buyers benefit from choice and negotiating power but economic headwinds may delay a market rebound. I have been watching weekly sales numbers on a daily basis and we peaked a few weeks ago at around 400 or so. We have slowly been inching down to a little over 300 per week (the latest numbers can be a little delayed due to paperwork filing etc).
I estimate about a 12% drop. It looks like the spring and summer busy period was a little late to get started and it is a little early to tell if it is going to continue or if it is already winding down.
I have heard chatter there are people trying to buy now but first they need to sell their homes and we haven’t seen enough sales volume to start that chain reaction in a meaningful way as of yet. My thoughts are families that want to buy into the detached home market are having a tough time. First, in saving for a downpayment and then qualifying for a mortgage of more than $700,000. That means downsizers can’t sell and then buy a condo.
As a side note, the minimum wage went up 87.89% from 2011 and pay for non-minimum wage jobs went up about 43.96% (this is an estimate using certain trades etc.) Some house prices in the Okanagan have increased about 142% over the same period (I grabbed a few solds from 2011 that also sold this year so it is not perfect data but I think it makes the point) Draw your own conclusions.
If you have suggestions for other real estate-related articles, please email me at [email protected].
This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.
