RBC Economics notes Vancouver condo market heated up, prices expected to accelerate

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      Things are looking up for condo properties in Greater Vancouver.

      A new report by RBC Economics notes that that market for condos has “heated up”.

      Referencing figures from the Real Estate Board of Greater Vancouver, economist Robert Hogue wrote that condo sales skyrocketed in March 2021.

      Last month’s sales rose 128.8 percent compared to March 2020.

      Specifically, a total of 2,697 condos were sold last month, more than double that of 1,179 sales in March 2020.

      In addition, the benchmark price of an apartment increased to $715,800.

      This means a 3.7 percent increase from March 2020, and a 2.6 percent improvement compared to February 2021.

      Hogue observed that even with the increased volume of sales, “relatively high inventories continued to temper the rate of price appreciation”.

      “This may not be the case much longer, however,” Hogue continued.

      Hogue expects “inventories to shrink as condos’ growing affordability advantage over other categories fuels buyer interest”.

      Hogue’s take on the Greater Vancouver condo market forms part of his broader report on the Canadian housing market, which was released Monday (April 12).

      Hogues new take on the condo market presents a departure from the economist’s previous outlook.

      Last year, the RBC economist released a number of reports that contained, among others, rather dire prospects for condo properties.

      For example, on September 30, Hogue wrote that he expects condo prices to “weaken in larger markets”, including Vancouver.

      In another report on October 15, the economist noted that condo prices have “stagnated over the past six months” at the national level and in big markets across the country.

      “Condo prices have flattened in Vancouver, Toronto and Hamilton relative to pre-pandemic levels,” Hogue wrote at the time.

      In a following report on October 29, Hogue noted that “condo investors are looking to sell”.

      “As rents soften and vacancies rise, condo listings are spiking in Toronto, Montreal and Vancouver—albeit from low levels,” Hogue reported on that day.

      The situation has obviously changed.

      In his April 12, 2021 report, Hogue wrote: “Condo sales have picked up in recent months in several large markets, including Vancouver, Calgary, Toronto, Ottawa and Montreal.”

      Condo owners looking to sell their properties may have reason to feel optimistic.

      “The stage looks set for some firming of condo prices in most major markets in the period ahead,” Hogue wrote.