Skip to content

Vancouver’s housing market re-wrote the record books in 2021

By the end of December, the Vancouver Region had set new all-time records for most annual sales, lowest monthly inventory, and highest benchmark prices. The challenges facing potential buyers have only intensified heading into 2022.

As we enter another new year, we find ourselves in somewhat familiar territory facing another spike in COVID-19 cases, and challenges in our local housing market that centre around a familiar topic - constrained inventory. Having said that, a deeper dive into the data reveals housing market dynamics that are decidedly unfamiliar to those of us in the Vancouver Region.

The housing theme of 2021 in the Vancouver Region could be framed around constrained inventory, with December’s listings count the proverbial icing on the cake. The total number of homes available for purchase  at the end of the year was just 6,705, the lowest it has ever been.

Total inventory has only dipped below 10,000 three times in the history of this region (the data goes back to 1989), including the previous month of November 2021, and has never before been below 9,000. December’s total is a staggering 29% below the previous all-time low set in December 2016. The record low is all the more shocking as the region has grown by more than 1.3 million people and added 500,000 homes since inventory data were first tabulated in 1989.

Inventory, however, wasn’t the only record-breaking housing metric the Vancouver Region recorded in December. The region finished 2021 with 70,621 homes sold, a whopping 42% increase over 2020 and 10% higher than the previous all-time high set in 2016. Sales activity continued to be relatively robust right through the end of the year, with December recording 4,395 sales. While this total is 13% below the previous December’s, it was still 45% higher than the previous 10-year average.

With all-time low inventory and all-time high annual sales in the region, conditions sit firmly in sellers’ market territory, thereby putting substantial upward pressure on prices. The benchmark price for each product type in the Vancouver Region has increased dramatically over the last year, led by detached homes which were up 30% over the course of the year to $1.76M. Townhome price increases weren’t far behind, with the benchmark price up 27% in 2021 to $914,200, followed by condos which saw a 16% increase to $769,500.

The good news for potential buyers looking for a home in the new year is that inventory typically rises in the early part of each year as the pace of new listings increases. However, with inventory at such an extremely low level (with fewer than 7,000 homes available in December), and sales above long-run averages for some time, achieving a balanced market in this context will, frankly, be next to impossible in the near-term.

Instead, it is overwhelmingly likely that our local housing market will continue to favour sellers as we make our way towards the spring market.

Ryan Berlin is the Senior Economist with rennie intelligence.