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Uncharted territory for Vancouver’s housing market

Through the first eleven months of 2021, the Vancouver Region has surpassed its previous whole-year record for MLS sales. With inventory levels continuing to sag to new record lows, sellers’ market conditions are deepening.

There has been much discussion of late about the scarcity of inventory in our local housing market (particularly in this space) and the challenges it presents for would-be buyers and sellers. In spite of these challenges and others—most notably affordability—the Vancouver housing market continues to roll along and find a way to reach new heights of activity.

While the discussion around sales has taken a backseat to inventory since the pace of sales slowed from its frenetic pace in the spring, sales have continued to trend at historically elevated levels. This has resulted in 2021’s total MLS sales count, through November, reaching 66,290—breaking the previous record for full-year sales set in 2016. And with December still to come, it’s likely that we’ll surpass 70,000 sales for the first time.

The story specifically for the month of November is similar to the year-to-date tale, with last month’s sales count of 5,329 representing a 4% increase over an already-elevated total in November 2020, and the highest of any November since 1989.

These sales were achieved in spite of the fact that we entered November with record-low inventory. The pace of new listings was not able to build on October’s inventory, with November’s 9,530 listings setting a new November record-low for this region.

This November is the first time inventory has dipped below 10,000 in any month that wasn’t a December. And of the previous two Decembers where it occurred, the preceding November had an inventory count above 13,000. With the typical seasonal pattern of inventory decline between November and December sitting at 27%, the final inventory tally in 2021’s final month could be somewhat jarring.

As the holiday season approaches and would-be sellers focus on decorating their homes rather than staging them, it sure seems likely that we will see inventory continue to decline through to the end of the year, to a number that perhaps seemed unthinkable at this time a year ago.

The challenging environment that currently faces would-be buyers (and sellers looking to make a move—but who are unwilling to list for fear that they promptly sell and then are not able to buy) is showing few signs of changing course. Without a substantial influx of new listings, these conditions are likely to continue into at least the early part of 2022.

Ryan Berlin is the Senior Economist with rennie intelligence.