‘Balance’ and ‘resilience’: REBGV’s 2023 Metro Van real estate wrap

“A story of surprising resilience” is how the Real Estate Board of Greater Vancouver (REBGV) is choosing to describe 2023.

It says while the region’s market closed out the year “with balanced market conditions,” “year-end totals mask” what was really playing out, in the face of skyrocketing borrowing costs.

The REBGV says residential sales were down just over 10 per cent in 2023 compared to the year before, and marked a 41.5 per cent decrease from 2021.

However, considering mortgage rates, the board says 2023 was a strong year for the housing market in Metro Vancouver.

“In our 2023 forecast, we called for modest price increases throughout the year while most other forecasters were predicting price declines. The fact that we ended the year with five-per-cent-plus gains in home prices across all market segments demonstrates that Metro Vancouver remains an attractive and desirable destination, and elevated borrowing costs alone aren’t enough to dissuade buyers determined to get into this market,” Andrew Lis, REBGV’s director of economics and data analytics, said Wednesday.

Despite the optimism, home sales in 2023 were more than 23 per cent below the 10-year annual average. The REBGV says the total number of properties listed was also down compared to the past decade, by 10.5 per cent.

The composite benchmark price for residential properties, meanwhile, currently sits at $1,168,700 — which the REBGV says marks a five per cent increase over December 2022.

Lis says the main message from 2023, which will likely come as no surprise to many, is that supply was lacking.

“Sellers were reluctant to list their properties early in the year, which led to fewer sales than usual coming out of the gate. But this also led to near record-low inventory levels in the spring, which put upward pressure on prices as buyers competed for the scarce few homes available,” he said.

“Looking back on the year, it’s hard not to wonder how we’d be closing out 2023 if mortgage rates had been a few per cent lower than they were. And it looks like we might get some insight into that question in 2024, as bond markets and professional forecasters are projecting lower borrowing costs are likely to come, with modest rate cuts expected in the first half of the New Year.”