Sales were down 30 percent from a year ago as rising mortgage rates and high prices deterred buyers.
Vancouver, B.C., Realtors haven’t had this lousy a July in almost two decades.
Sales were down 30 percent from a year ago to 2,070 units, the fewest transactions in the month since 2000, according to data released Thursday by the Real Estate Board of Greater Vancouver. Buyers are being deterred by rising mortgage rates and benchmark prices that remain over the $1 million mark.
“It’s a new norm, a new market,” said Adil Dinani, a real-estate agent with Royal LePage, a unit of Brookfield Real Estate Services. “I have sellers stuck in the mindset of wanting what their neighbors got earlier this year — it’s just not going to happen.”
Homes are selling under the asking price, and buyers are including standard protection clauses — something unheard of during the market frenzy of recent years in Canada’s most expensive city.
Sales of detached properties declined by 33 percent from a year ago, and apartments are down 27 percent.
Detached homes sold for an average of C$1.61 million ($1.24 million) and apartments averaged C$712,092. The overall composite benchmark price fell 0.6 percent in July to C$1.09 million, though it’s up 6.7 percent from a year earlier.
The report signals buyers are still adjusting to tougher mortgage-qualification rules that the federal government introduced Jan. 1, and to the four increases in the Bank of Canada’s trendsetting interest rate over the past year. Those rules were put in place after surging prices in both Toronto and Vancouver led to warnings about excessive speculation.
Other levels of government have also cracked down. British Columbia’s provincial government imposed a tax on foreign buyers, and Vancouver is trying to deter property speculators with a levy on vacant homes.
“With increased mortgage rates and stricter lending requirements, buyers and sellers are opting to take a wait-and-see approach for the time being,” Phil Moore, president of the Real Estate Board of Greater Vancouver, said in the report.