Home prices have been declining over the past few months because of rising interest rates.
But as one economist noted, prices would have to fall some more in order to return to pre-COVID-19 times.
And besides, before the pandemic, Benjamin Tal of CIBC wrote in a July 22, 2022 analysis, “nobody suggested that Toronto or Vancouver were affordable”.
The case of a detached home on the east side of Vancouver home may illustrate partly what’s happening in the market.
The property at 2426 East Georgia Street sold on August 8, 2021 for $1,460,000.
The 2,026-square-foot home features four bedrooms and two baths, and has the potential to be redeveloped into a duplex.
At the time of its sale, the property has a 2021 assessment of $1,250,700.
Less than a year later, the same Vancouver real estate is back on the market.
This time, the 1960-era home is asking for more money at $1,690,000.
Based on available information online as of this post Sunday (July 31), the June 20, 2022 listing has yet to land a buyer.
Meanwhile, the 2022 assessment of the same property has increased to $1,450,300.
The Greater Vancouver real-estate board has reported that the benchmark price of a single-family home in East Vancouver fell by 2.2 percent in June 2022 compared to the previous three months.
However, the current benchmark price marks an annual increase of 12.9 percent in comparison to June 2021.
David Hutchinson of Sutton Group-West Coast Realty represented the sellers in the August 8, 2021 deal.
Looking back now, Hutchinson told the Straight that the market went up a bit more after 2426 East Georgia Street sold in the summer of 2021 for $1,460,000.
He said that one might say that the sellers could have waited some more.
“But now, the market has settled back as interest rates have increased,” Hutchinson noted.
After a quick scan of current listings and recent sales of comparable properties in East Vancouver, the realtor said that his sellers actually got a “good price”.
To cite an example, a detached home at 4997 Moss Street sold on July 13, 2022 for $1,463,999.
Measuring 2,837 square feet, this residence is bigger than 2426 East Georgia Street.
In addition, it has more rooms, numbering six, and two baths.
Another example is 526 East Cordova Street, with a 2,461-square-foot home containing six bedrooms and four baths.
This piece of Vancouver real estate listed on June 27, 2022 for $1,199,000, which is less money than what 2426 East Georgia Street sold for in 2021.
“In the end, isn't that what real estate is all about?” Hutchinson asked.
“Sellers can sell, buyers can buy, and everyone is happy.”
The Bank of Canada has raised interest rates four times since March 2022.
The central bank’s interest-setting rate now stands at 2.5 percent, and more increases are expected through 2022.