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Vancouver Real Estate News

Vancouver Housing Market Overview

Vancouver's housing market in June remained relatively unchanged from the month before. Benchmark home prices for the region have changed by less than a percent from May with condo apartments seeing the most volatility with a small 1% decline. Home sales have dropped by more than 30% from March highs but still remain above 2019 and 2020 levels and within the range of long-term averages. In retrospect, the high levels of activity in March was likely to be an outlier and the housing market in Vancouver is returning to more normal market conditions.

Benchmark home prices stayed flat for all property types this June. The total benchmark price for all property types was stable month-over-month at $1,175,100, a 15% year-over-year increase. Benchmark prices of detached homes have increased the most in the past year with a 23% year-over-year gain to $1,801,100. Townhouses have also seen a surge in prices in early 2021 to $946,900, a 20% year-over-year increase. In contrast, condo apartment benchmark prices have only risen by 7% year-over-year to $727,600. These price trends are similar to those in Toronto's housing market where condos prices have risen by only 8% in a year compared to 25% for detached homes.

One tailwind for Vancouver's housing market is the recent update of the CMHC's First-Time Home Buyer Incentive. Home buyers in Vancouver, Victoria, and Toronto can now qualify for a 5% or 10% down payment incentive paid by the Federal government with a household income of up to $150,000 (previously $120,000) and a total borrowed amount of up to 4.5x (previously 4x) their household income. This can potentially create increased direct demand for homes up to $722K in the Vancouver area.

In addition, the CMHC has recently decreased their standards for insured mortgages. This reverses the increase from last year and drops required credit scores from 680 to 600 and increases GDS and TDS ratio limits to 39% and 44% from 35% and 42%, respectively.

However, the Office of the Superintendent of Financial Institutions (OSFI) and the Ministry of Finance have recently raised the benchmark mortgage stress test rate for both insured and uninsured borrowers from 4.79% to 5.25%, limiting affordability for marginal buyers.

Mortgage rates have risen from their 2020 lows but have remained stable for the past few months. However, the prospect of tighter monetary policy from the Bank of Canada as early as mid-2022 could lead to increased rates and limit home affordability in Vancouver.

Vancouver Commission Structure

Real estate commissions are the fees that home sellers pay to the seller and buyer real estate agents for their services. In Vancouver, the total commission rate is structured as 7% for the first $100,000 of a home’s sale price and 2.5% on the remaining balance. Seller agents usually get half or 50% of this total commission with buyer agents getting the other half. To calculate your real estate commission for Vancouver, see our calculator below. For other cities in B.C., please visit our BC real estate commission calculator page for more information.

Sold Price

$

Location

Vancouver

Fraser Valley

Victoria

Kelowna

You will pay around...

$25,72526k

7%

on first $100k

2.5%

on remainder

Buying Agent Commission

$11,26311k

Selling Agent Commission

$13,23813k

5% GST

$1,2251.23k

The seller of the property will pay for both buying and selling agents' commission. For example, if the seller agent commission is 2.5% and the buyer agent commission is 2.5%, you will pay a total commission of 5%.

Vancouver Real Estate Tools for Buyers and Sellers