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Benchmark Metro Vancouver detached home up slightly to $967,500, real estate board says

The latest Metro Vancouver real estate numbers are "very clear signs" of a slowdown in the market, according to a local analyst.

"We're getting this consistently now," said Tsur Somerville, director, centre for urban economics and real estate, Sauder School of Business at the University of B.C., after a monthly report by the Real Estate Board of Greater Vancouver showed a continued rise in listings as sales drop.

"We're in a market that's much slower than what we're used to and I think that will transfer into much more sluggish prices, at best."

According to the board's report, released Monday, May sales were the lowest total for the month since 2001 and 21.1-per-cent lower than the 10-year average for May sales. Local home sales in April were also the lowest total for that month since 2001.

Somerville noted that it's the eighth consecutive month in which sales dropped compared to the same month a year before.

Despite the trend, the report said the Metro Vancouver market remains stable with little in the way of price increases, and that sales have been constant through the spring months, with similar numbers in March and April.

Cameron Muir, chief economist for the B.C. Real Estate Association, maintained that the market remains balanced.

"Overall, the market remains in balanced territory, which means no particular advantage for either the buyer or seller," said Muir. "We won't see much upward or downward pressure on the pricing side."

According to the REBGV report, sales reached 2,853 in May, 15.5-per-cent lower than the 3,377 sales in May 2011.

However, new listings reached 6,927 in May, more than 14 per cent higher than April and a 16.8-per-cent increase compared to a year ago, when 5,931 homes were listed for sale.

The number of new listings last month was 15.3 per cent above the 10-year average for May listings.

At 17,835, the REBGV said, the total number of listed homes increased 7.9 per cent in May compared to April and 21 per cent above this time last year.

"Home sellers have outpaced buyers in recent months, however, there continues to be an overall balance between supply and demand in our marketplace," real estate board president Eugen Klein said in a statement.

"Our sales-to-active-listing ratio sits at 16 per cent, which is indicative of balanced market conditions," he added. "As a result of this stability, home prices at the regional level have seen little fluctuation over the last six months."

According to Muir a balanced market is typically between 15 and 20 per cent.

According to the report, the bench-mark price - the price of a typical home - for all residential properties in Metro Vancouver is now $625,100, up 3.3 per cent compared to May 2011 and up 2.4 per cent over the last three months.

Sales of detached homes in May reached 1,180, a drop of 24.8 per cent from May 2011. The benchmark price for detached homes increased 5.1 per cent from a year ago, to $967,500.

Muir said home sales have been moderating since the beginning of the year, with prices flat relative to last year.

Sales could bounce back in June, he added, but "there is little if any upward pressure on housing prices."

Somerville said he can't pinpoint a specific reason for the sales slowdown, but that factors could include a lack of faith in the economy, a slowdown in offshore investment or buyers refusing to pay high prices.

In the Fraser Valley, it was a different story - both listings and sales rose.

"It's a healthy, competitive market," Fraser Valley Real Estate Board president Scott Olson said in a statement. "The average number of days to sell a detached home or a townhome is still only a month and a half and for con-dos a little over two months, which is why we're seeing benchmark prices in most communities holding steady."

According to the board, there were 1,616 sales in May, an increase of 13 per cent compared to April and similar to the 1,608 sales in May 2011.

As well, the board received 3,305 new listings, an increase of eight per cent from May 2011, increasing the inventory of active listings in the Fraser Valley to 10,826, also up eight per cent from May 2011.

In the Valley, the benchmark price for a single family detached home increased 3.6 per cent, from $528,900 in May 2011 to $548,000 last month.

bmorton@vancouversun.com


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