Prices for single-family detached homes in Greater Vancouver have climbed to a record high.
The Real Estate Board of Greater Vancouver's home price index for detached properties hit $976,700 in June, up 6.2 per cent from the same month in 2013.
The index price is calculated by using a formula that strips out the most expensive resale properties on the Multiple Listing Service. The board cautions that average prices give a skewed picture of the market because sales of many high-end homes boost the figures to well above other transactions that are considered more typical.
There were four areas in the region where index prices for detached homes exceeded $1-million in June: Vancouver's west side ($2,257,100), West Vancouver ($2,053,300), Burnaby South ($1,015,200) and North Vancouver ($1,010,000).
Greater Vancouver sales of detached homes, townhouses and condos totalled 3,406 in June, up 28.9 per cent from June, 2013, but only 0.6 per cent higher than the 10-year sales average for June, board president Ray Harris said Thursday. The composite price index for all three types of resale properties rose 4.4 per cent over the past year to $628,200 – also a record high.
Bryan Yu, the Vancouver-based economist at Central 1 Credit Union, said in a new report that price gains for detached homes are ascending faster than increases in townhouses and condos.
"Rising detached home prices reflects a scarcity of developable land in Greater Vancouver as the geographically constrained land base remains under pressure from a rising population," said Mr. Yu, who added that income-generating suites inside detached homes have contributed to hikes in real estate values.
The detached index price on Vancouver's west side has jumped 9 per cent in the past year. Other notable year-over-year gains include: Port Moody (up 8.5 per cent to $895,400), Vancouver's east side (up 8.6 per cent to $918,900) and Burnaby North (up 9 per cent to $996,300).
By contrast, prices for townhouses and condos have increased modestly across the region over the past year, and even slipped in some neighbourhoods over the last three years. Tighter mortgage lending rules and a flurry of high-rise projects have combined to dampen the condo market, Mr. Yu said.
In Coquitlam, for instance, June's index price for condos grew 2.6 per cent to $255,000 over the past year, but is down 3.3 per cent from June, 2011.
Mr. Yu said British Columbia's economy has benefited from new immigrants, but there has been an exodus of many residents who headed east in the last couple of years to other provinces. "Strengthening economic growth and more job opportunities should keep residents within B.C. borders and attract Canadians from other parts of the country in 2015 onwards," he said.
In the Fraser Valley, which includes the sprawling suburb of Surrey, June's index price for detached homes reached a record-high $568,600, up 3 per cent from a year earlier. Total residential, commercial and retail sales last month in the Fraser Valley advanced to 1,668 transactions, up 25.7 per cent from June, 2013.
There has been a surge in demand for detached homes and townhouses in the less-expensive Fraser Valley. "Parts of the Fraser Valley have increasingly become bedroom communities for the Greater Vancouver area, given the attractiveness of lower home prices, particularly for those commuting to Surrey and Langley," Mr. Yu said.
Central 1 Credit Union noted that housing markets in northern British Columbia already have received a lift from preliminary work on liquefied natural gas projects and drilling activity.