Prices for detached homes in Metro Vancouver are holding steady, but condo prices have marked a slight drop, according to a new housing survey.
The average price of a Vancouver condo in the third quarter of 2010 was $359,411 - a drop of 0.9 per cent, compared to the second quarter, while the average detached house was priced at $770,623, a gain of 2.3 per cent.
While prices have moderated, sales as a whole for the province are down by 35 per cent, according to the report from Landcor Data Corp..
Landcor president Rudy Nielsen says lower condo prices are a reflection of too much stock and consumer reluctance to buy.
“Supply and demand are still the two magic words in real estate,” said Mr. Nielsen. “They built so many [condos], it’s overbuilt.”
He also blames confusion in the run-up to the HST as impacting the market in the spring, pushing prices upward as buyers purchased before the HST was implemented. Many consumers didn’t understand the tax would only apply to new homes, says Mr. Nielsen. By July, when the tax came into effect, sales had dropped by 45 per cent.
“The HST does affect home prices and will dampen already skittish and price-sensitive would-be buyers,” says the report, which is based on all residential transactions according to provincial assessment data.
Consumers are also adopting a “wait and see” approach to the dicey market, says Mr. Nielsen.
“A lot of people are waiting for prices to fall even more, and when you see the Millennium Water Olympic Village stories all over the paper, saying they are going to drastically drop prices, that immediately makes people think, ‘How low will it go? And then I will buy.’”
For the province as a whole, the average condo price was down 3.2 per cent from the last quarter, while the average house price was down 1.5 per cent.