Bidding wars are causing Lower Mainland real estate prices to rise
Posted March 2, 2021 10:06 am.
Last Updated March 2, 2021 10:44 am.
VANCOUVER (NEWS 1130) — Real estate prices in the Lower Mainland are on the rise despite the pandemic.
According to The Real Estate Board of Greater Vancouver increased competition for homes has meant more bidding wars, pushing prices up even further.
“(The) housing market is experiencing seller’s market conditions,” says Colette Gerber of the REBGV. “The supply of listings for sale isn’t keeping up with the demand we’re seeing (and) competition amongst home buyers is causing multiple offer situations and upward pressure on prices.”
The board says February home sales for the Metro Vancouver region were more than 40 per cent above the 10 year average with a 26.1 per cent increase of newly listed homes. In the Fraser Valley, sales were up by 88 per cent above the 10-year average.
According to both REBGV and Fraser Valley Real Estate Board, low interest rates have contributed to an increase in demand.
“We’re seeing steady numbers of first-time home buyers and move-up buyers entering the market,” explains Gerber, adding the boom is also rippling into Langley, Maple Ridge and West Vancouver.
Psychological pressures on buyers due to pandemic
Wile record-low interest rates are part of the equation, Keith Roy with RE/MAX Select believes the brief viewing windows — usually about 10 minutes per potential buyer — due to the COVID-19 pandemic are also prompting people to make aggressive offers.
“You don’t have a lot of time to linger in a home and you don’t have a lot of homes to see. So every home you go to, there’s someone else waiting to get in behind you and I think that’s driving, along with interest rates, some of the high demand and the big prices that people are putting out there,” Roy explains, adding this situation is also motivating sellers.
“We’re hearing a lot of quote, unquote, stupid prices for houses, where the sellers are surprised how much they’re getting and the buyers feel like they’re overpaying, but they’re doing it anyway,” he tells NEWS 1130.
And while this may be good for business now, Roy notes this environment won’t last forever.
In Metro Vancouver, sales of detached homes are up 79.9 per cent with the average price rounding up to $1.6 million. Apartments are up 65.8 per cent, with the benchmark price reaching almost $700,000.
In the Fraser Valley, sales for detached homes increased by 19.9 per cent with a benchmark price of about $1.1 million. Apartments are up 5.3 per cent with the benchmark price being just shy of $500,000.