The reality is hitting Vancouver fast as the housing market is rebounding at a faster rate than expected. Home sales in the area reach record high in May according to the Canadian Real Estate Association. Even though home prices have declined for the first time after four years, the housing market is recovering again after measures have been taken last year to cool the market.
But according to Royal LePage this housing market rebound is not expected to last long as it has managed to recover at a faster expected time.
During the first quarter of the year, the average home price in the Greater Toronto Area increased by 20% to about $759,241 whereas in the Greater Vancouver Area, home prices soared by 12.3% to $1,179,482.
However in the Canadian housing market, Langley recorded the highest increase with prices escalating by 21.2% to $794,213. In terms of affordability, Surrey was the most reasonable market with the average home price at $763,806. West Vancouver was the least affordable market with the home price at $3,306,286.
According to Royal LePage CEO Phil Soper, the changes to the Vancouver real estate market started to play out seven months ago during the same period when the British Columbia government introduced a 15% tax, forcing buyers as a measure to control home prices.
Following the tax, home sales and prices started to decline but in recent months, home sales in the area have increased to about 50% and this is higher than the seasonal average.
Soper went on to express that sudden changes to the housing markets always have a boomerang effect and it is possible that in the weeks to come, there will be a significant increase in the demand for homes which will sharply increase home prices.
In the meantime, Vancouver is hoping that the market recovery will not go back to the record high home prices that were seen in the recent years.
Looking at the overall figures, the Canadian home prices increased by 12.6% to $574,575 in the first quarter.