By The Canadian Press | The Canadian Press – Wed, 4 Jul, 2012 5:40 PM EDT
Canada’s hottest real estate market takes nosedive
Sales in one of the most popular cities to purchase plummet to a 10-year low, ahead of mortgage rule changes.
VANCOUVER – Vancouver home sales hit their lowest level in more than a decade in June, falling 17.2 per cent from May, and tilting the market in favour of buyers, the city’s real estate board said Wednesday.
However, despite a drop in the number of sales, prices in what was once the country’s hottest real estate market have remained firm, the board said.
The Real Estate Board of Greater Vancouver reported 2,362 sales in June, which is a decline from 2,853 in May and also off 27.6 per cent from a year earlier when there were 3,262 sales.
However, despite the lower sales numbers, the housing price index for residential properties in Vancouver was still up 1.7 per cent from a year ago.
"Overall conditions have trended in favour of buyers in our marketplace in recent months," board president Eugen Klein said.
"This means buyers are facing less competition and have more selection to choose from compared to earlier in the year."
The board said June sales were the lowest total for the month in the region since 2000.
June sales of detached properties in Vancouver totalled 921, down from 1,471 in June 2011, while the price for detached properties increased 3.3 per cent from a year ago to $961,600.
Sales of apartments slipped 19 per cent to 1,026 in June from 1,266 a year ago. The benchmark price of an apartment increased 0.3 per cent from June 2011 to $376,200.
Meanwhile, there were 415 attached property sales in June, down from 525 a year ago, while the benchmark price decreased 0.1 per cent from a year ago to $468,400.
Vancouver has been one of the country’s hottest housing markets, but has shown signs of cooling in recent months.
New listings for detached, attached and apartment properties in the Greater Vancouver region totalled 5,617 in June, down from 6,927 new listings in May and from 5,793 new properties a year ago.
The total number of residential property listings on the board’s MLS service was 18,493, up 3.27 per cent from May and up 22 per cent from this time last year.
The slow down in sales in Vancouver comes ahead of changes by Ottawa to tighten mortgage lending in Canada.
Finance Minister Jim Flaherty moved last month to cool the red hot condo markets in Toronto and Vancouver by tightening the rules for borrowers including cutting the maximum amortization period for government insured mortgages cut to 25 years from 30.
As well, the federal regulator of financial institutions has told lenders they can only issue home equity loans up to a maximum of 65 per cent of the property’s value, down from the previous 80 per cent.