Multiple Listing Service (MLS) sales are holding strong heading into 2021, propelled by exceptionally low mortgage rates and a desire for larger properties and recreational homes fuelled by the pandemic, high savings rates and stable employment for many higher-income workers.
November sales in B.C. reached 9,491 units, marking a 43% year-over-year gain and the strongest same-month sales on record. The second-highest sales numbers were observed in 2015, when 8,043 units were processed through real estate boards in the province.
That said, the trend has crested, with seasonally adjusted sales up 0.5% from October after a prior month decline of 2%. Regional performance was mixed. Sales were dampened by small declines in the Lower Mainland-Southwest, as a drop in Metro Vancouver sales contributed to a 1% decline in the region. Victoria sales fell 8.3%. Outside the largest urban centres, sales in the southern Interior and on the Island continued to rise and trend at record high levels. Year-to-date, sales were up 18.7% through November.
Market conditions are tight. While the average home price dipped 0.6% from October to $806,356, this largely reflected fewer sales in higher-priced markets and sales composition. Year-over-year, the average price rose 8.4%. MLS constant quality price indices, which adjust for changes in home types rose and led by monthly gains of more than 1% on Vancouver Island and the Fraser Valley.
B.C. retailers posted a huge October sales bounce to far outpace the national increase. Seasonally adjusted sales rose 2.1% from September to $8.0 billion at bricks-and-mortar stores, driven by Metro Vancouver. While retailers haven’t made up for lost sales during the spring, monthly sales are above pre-pandemic levels, undoubtedly helped by stores adopting a greater e-commerce presence. Dollar-volume sales were 8.9% above February and 11.1% above year-ago levels. Nationally, sales rose 0.4% from September and 7.5% year-over-year.
October sales growth was observed broadly across store segments. Consumers flooded car dealerships – possibly spurred by low interest rates and fears of being exposed to the virus on public transportation. •
Bryan Yu is chief economist at Central 1 Credit Union.