Demand for Vancouver’s luxury real estate is increasing as buyers on the sidelines come back into the market, according to a report released Tuesday by Re/Max Canada.
Inventory continues to be the top issue for the Metro Vancouver region, as well as across Canada, said Elton Ash, executive vice-president of Re/Max Canada.
“What we're seeing as the biggest challenge in Vancouver is inventory – and you can't sell what's not there. That's really the bottom line,” he said.
In February 2023, new listings declined by nearly 40 per cent year-over-year, with the luxury market experiencing even tighter inventory, according to Re/Max’s latest luxury real estate report.
Activity for high-end real estate is increasing as buyers look to take advantage of somewhat softer housing values, according to Elizabeth McQueen, a real estate agent with Re/Max Canada. Despite higher demand, sellers are holding firm on price and may even hold out on a transaction if it’s not what they want.
“Sellers would rather stick to their price or take it off the market, then adjust accordingly; or stick with their price and pay their vacancy tax if the situation happens to be a secondary home for them,” said McQueen.
“Because what they would have to adjust their price for would be more than what they would pay in vacancy tax. So they're better off to wait until there's more demand in the market to put it back on.”
Sales for detached homes over $4 million in Metro Vancouver have decreased by almost 50 per cent compared with levels reported in the first quarter of 2022. However, the number of homes sold in the first three months of 2023 are more than 20 per cent ahead of the last quarter of 2022.
“We're getting some more showings but there's still so few sales compared to last year,” McQueen said. “Once we see more showings, the sales are coming.”
Meanwhile, immediacy is not a concern for many of these buyers and sellers, said Ash.
“In other words, if you're selling a home that's in this segment and a buyer doesn't come around tomorrow, you're patient,” he said. “It’s the same on the buyers' side as well. If they’re particular about what they're looking for and if the home isn't here today, they'll continue looking but if it does come on to market, they will act.”
For detached homes, neighbourhoods like Shaughnessy, Point Grey, Kerrisdale and Marine Drive are the most popular, according to the report. For condos, three bedroom-units downtown are in high demand and few and far between.
Sales are expected to ramp up as Vancouver enters the spring market.
“We can see that the second quarter is going to be much stronger than most of the specialists out there would have anticipated at the end of last year,” said McQueen.
