Amid a standoff between buyers and sellers, the number of homes sold in Greater Vancouver fell 14.3 per cent last month.
There were 1,351 property sales in the region in January, down from 1,577 in the same month of 2012, the Real Estate Board of Greater Vancouver said Monday. The year-over-year price index in January for single-family detached homes, townhouses and condos decreased 2.8 per cent to $588,100.
"We don't think it is a crash. We just think it is a mild correction that the real estate market is going through," Helmut Pastrick, the Vancouver-based chief economist at Central 1 Credit Union, said in an interview.
Mr. Pastrick forecasts that sales in Greater Vancouver and the Fraser Valley will be slightly down this year, compared with 2012, and that benchmark prices might slip roughly 3 per cent.
But as the provincial, national and international economies gradually strengthen, 2014 and 2015 will likely mark the return of better times in B.C. real estate, he said.
"The market will remain soft for a few more months, and then begin to stabilize," Mr. Pastrick said. "The improvement in economic conditions will generate gains in employment and income, and consumer confidence will pick up."
Eugen Klein, president of the Greater Vancouver board, said many home sellers are choosing to delist their homes rather than settle for a lower bid. "When a home seller isn't receiving the kind of offers they want, there comes a point when they decide to either lower the price or remove the home from the market. Right now, it seems many home sellers are opting for the latter," Mr. Klein said in a statement.
"Home sale activity has been below historical averages in Greater Vancouver for about seven months. This has caused a gradual decline in home prices of about 6 per cent since reaching a peak last spring," Mr. Klein said.
Sales volume last month marked the second-lowest January since 2001 in Greater Vancouver. And the price index for single-family detached homes in January was $901,000, down 3.1 per cent from a year earlier.
The number of new listings in Greater Vancouver has been faltering, hitting 5,128 last month, or a 10.9-per-cent drop from January of 2012. The total number of properties on the multiple listing service rose 5.6 per cent year-over-year to 13,246 last month, but fell 4.5 per cent from December.
In the Fraser Valley, which includes the sprawling and less expensive Vancouver suburb of Surrey, there were 617 properties sold last month, down 23 per cent from the 799 that changed hands in January of 2012. Like the Greater Vancouver board, the Fraser Valley group said it uses the home price index, which strips out the most expensive properties, because that serves as a better barometer of trends than average prices. January index prices on the multiple listing service in the Fraser Valley rose 0.7 per cent over the past year to $420,900. Over the past six months, however, prices have slipped 2.5 per cent.
Scott Olson, president of the Fraser Valley board, said some prospective buyers are taking a wait-and-see attitude in the hopes that prices will dip in 2013.
But with low interest rates and prices holding steady despite a slowdown in sales, there should be pent-up demand to restore balance to local real estate markets, Mr. Olson said.