Rate Hikes Continue To Slow down Sales In The Metro Vancouver Housing Market
Increasing mortgage rates over the last several months designed to bring down inflation have substantially increased the cost of borrowing for home buyers. As a result, home sales have slowed 46.4% in September 2022 compared with September 2021.
With home inventories increasing and sales slowing, prices have also been declining. The MLS Home Price Index shows an 8.5 % average decrease over the last six months, however to put things in perspective this is still 3.9 % higher than September 2021. We may well see further declines as Bank of Canada are expected to increase rates further a couple more times before year end.
It is not all bad news for buyers as purchases can now be negotiated, with many properties selling below list price and there is more selection to choose from with growing inventories.
The big question is where will our economy be as we move into 2023 and when will inflation be well under control. One thing that history has taught us is that our real estate market will bounce back and it’s a matter of when.