Fresh MLS data compiled by Canadian real estate brokerage Zolo revealed that majority of Metro Vancouver’s real estate segment is currently experiencing a significant correction, as predicted by OECD around three months ago.
The average home price in the City of Vancouver plunged by 20.7 per cent in the last 28 days alone, and 24.5 per cent over the last quarter—down to $1.1 million, Zero Hedge reported.
Meanwhile, the average price of detached homes dropped by 7 per cent over the past three months, down to $2.6 million.
Sales volumes have also seen similar falloffs, with only 3 transactions in West Vancouver in the first two weeks of August—a sharp 94 per cent decline from 52 sales over the same period in 2015.
These developments coincided with record-breaking vacancy rates in Vancouver’s commercial real estate sector, which reached 10.4 per cent as of June 30 according to Avison Young. The completion of six office towers totaling approximately 802,700 square feet by year’s end is poised to exacerbate the amount of empty space, amidst the ever-increasing costs of rental in the city’s premium assets.
Cadillac Fairview’s reported sale of a $4-billion real estate portfolio is emblematic of the trend towards withdrawal from the Vancouver market. The portfolio covers 14 assets in Vancouver and Richmond, including Canada’s largest shopping centers, historic buildings, and office towers.
Vancouver commercial properties have seen record prices over the past few months due in no small part to foreign demand, exemplified by the $1-billion-plus purchase of the Bentall Centre by the Chinese holding company Anbang Insurance Group.