The average price for single-family detached houses shot up 22.5 per cent over the past year in Greater Vancouver to hit a record $1.65-million last month, producing a gain of nearly $303,000 on paper.
The region's real estate market has been generally on a upward trajectory for 15 years, although there were dips during the 2008-09 recession and from mid-2012 to mid-2013. Since the summer of 2013, Greater Vancouver's housing market has been on a tear, raising questions about how long prices will continue rising.
"I just cannot believe that we're going to see the significant increases that we've experienced over the past two years continuing over the next two years," said Michael Geller, an urban planning consultant to developers.
The market is hottest within the city of Vancouver, where the median price last month for detached houses reached $3.2-million on the west side and $1.36-million on the east side – both record highs. On the west side, that's up $542,500 or 20.4 per cent over the past year, while on the east side, the jump is about $328,500 or 31.7 per cent.
More buyers are chasing fewer listings. Last month, there were 6,024 listings of detached houses, townhouses and condos on the Multiple Listing Service in Greater Vancouver, down 41.6 per cent from December, 2014. Total sales climbed 33.6 per cent over the past year to 2,827 last month, the Real Estate Board of Greater Vancouver said on Tuesday. For the full 12 months of 2015, there were a record 42,326 sales of all housing types.
With increases in detached residential values much higher than what most people earn in one year, more Vancouver homeowners will be tempted to lock in their gains and move to certain suburbs such as Surrey and Langley, if they have family members living there, Mr. Geller said.
"People can fund a significant portion of their retirement by cashing out," he said, pointing to the Sunshine Coast as one of the less-expensive possibilities. But West Vancouver, North Vancouver, Burnaby, Richmond, Port Moody and Tsawwassen are among the suburbs where detached properties are already pricey.
Real estate agents say first-time buyers need to consider townhouses and condos because they are generally far more affordable than detached houses, although Mr. Geller said some parents are helping their adult children with down payments on detached properties.
Statistics are being scrutinized as Vancouver garners international attention for attracting wealthy home buyers from China to the city's west side. It is difficult to gauge the ripple effects in the suburbs from that influx of Chinese money into Vancouver's west side, but the broader issue remains the mismatch between housing supply and demand, Mr. Geller said.
A sturdy B.C. economy and low interest rates have also fuelled the real estate bonanza.
The Home Price Index benchmark price for detached properties in Greater Vancouver rose 24.3 per cent over the past year to $1.25-million last month. The Real Estate Board of Greater Vancouver uses the benchmark price as a representation of the typical house, saying that averages skew the picture because the most expensive properties are included.
Prices in Greater Vancouver have surged more than 10 per cent since B.C. Assessment conducted its valuations of properties on July 1, 2015, meaning assessment notices being mailed out this week are already well below market values.
Surrey and Langley are among the areas in the Fraser Valley Real Estate Board, which reported that prices for detached houses in its territory averaged $804,391 last month, up 20.5 per cent from a year earlier.
The Fraser Valley board saw 1,543 sales of all housing types last month, a record for December.