Vancouver house prices continue to fall

By in Global Housing

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By Leith van Onselen

The Teranet-National Bank House Price Index for May has been released, which shows that Canadian house prices rose by 0.5% across the 11 major markets, with annual growth falling to 0.7%:

Across the three major markets, values fell by 0.2% in Vancouver in May, but rose by 0.7% in Toronto and by 0.5% in Montreal.

In the year to May, Vancouver values fell by 4.1%, whereas they rose by 2.6% in Toronto and by 5.3% in Montreal.

Since peaking in July 2018, Vancouver’s house prices have fallen by 5.0%.

Meanwhile, the Real Estate Board of Vancouver reports that prices and sales volumes have fallen heavily:

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,638 in May 2019, a 6.9 per cent decrease from the 2,833 sales recorded in May 2018…

Last month’s sales were 22.9 per cent below the 10-year May sales average and was the lowest total for the month since 2000…

*The MLS® Home Price Index2 composite benchmark price for all residential homes in Metro Vancouver is currently $1,006,400. This represents an 8.9 per cent decrease over May 2018, a 3.4 per cent decrease over the past six months, and a 0.4 per cent decrease compared to April 2019.

The weakness in Canada’s housing market helps to explain why the Canadian Government has unleashed a new wave of first home buyer subsidies in a bid to support prices.

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Leith van Onselen

Leith van Onselen is Chief Economist at the MB Fund and MB Super. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.

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