Although Vancouver condo sales continued to drop in March, almost half of those sales were sold above asking price. Vancouver realtor Steve Saretsky says this confirms that bidding wars are still prevalent in the market, and will likely continue for some time.
“We have fewer buyers but those fewer buyers are basically just competing over no supply, so you’re still getting multiple offers,” Saretsky tells BuzzBuzzNews.
Last month, a total of 506 condos sold in the city, down from 632 units sold in March 2017 and Vancouver’s lowest condo sales total since the year 2013.
Similar to the rest of BC, the Vancouver-based realtor says condo sales have been dampened by stricter mortgage regulations and eroding affordability.
“When you have new policy measures introduced, like a stress test, and ever-higher house prices, at some point affordability starts to bite and I think that’s what we’re seeing,” says Saretsky.
Despite the slowdown in sales, 48 per cent of condo sales sold above asking price in March, up 11 per cent from a year ago.
In a recent blog post, Saretsky writes that the increase of these above-asking condo sales is a result of “listing inventory still stuck at crisis levels.”
In March, Vancouver’s condo inventory totalled 932 units, a 16 per cent decline from 1,089 condos recorded a year ago.
Saretsky notes that one-bedroom condos are more likely to be in a bidding war, as they provide a more affordable price point for first-time buyers.
“For one-bedrooms, almost every time it’s going to be a multiple offer situation. As soon as you get to the more expensive two-bedrooms, it really starts to slow down,” says Saretsky.
Going forward, Saretsky predicts that sales will continue to fall this year. However, he adds that bidding war relief could be in sight later this year.
“Fewer sales combined with more and more supply — we have record supply hitting the market that’s now finally starting to complete — will hopefully push inventory levels up, but I think that’s going to take some time,” says Saretsky.
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