Real Estate Board of Great Vancouver
2024 Market Forecast
What does 2023 market tell us about Q1 2024?
The first half of 2023 was busier than many analysts predicted with homes selling quickly and prices escalating at a rapid rate. While the last quarter of the year saw a semi-drastic slow down in the market it brought balance to what was an overly active spring market. If the 2023 market were to be boiled down to a single word it would be ‘resilience.’ As a 2023 market buzzword resilience encapsulates the global demand to find housing in the lower mainland. Despite bank rate increases prices held, and even increased…when many predicted a sharp decline. Regardless of global events, bank pressures, and inflation people still want to live in Vancouver, and are will to pay the price to do so.
What does this tell us about 2024? With bank rates expected to see multiple small decreases throughout the year buyer demand is likely to return to Metro Vancouver. The main question is, how long will the current balanced market last? And to what degree will prices begin to increase as rates come down and buyer demand return?
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Taking a myriad of factors in to consideration the Real Estate Board of Greater Vancouver (REBGV) is predicting that 2024 will be categorized by growth driven by a strong demand for housing.
Specifically the REBGV had the following to say about 2024 housing forecast:
The REBGV believes that interest rates remain the largest ‘wildcard’ in predicting 2024 market activity. From there perspective there are two likely outcomes:
- “Rates will be reduced by a greater degree than forecasters are expecting if economic growth decelerates more than the Bank of Canada has forecast.
- Rates may remain slightly higher than forecasters are expecting if the path of economic activity remains in-line with the Banks’ expectations.
In the first scenario, assuming the slowdown in economic growth remains modest and is not paired with significant job losses, a lower policy rate could bring many buyers off the sidelines into the market.
In the second scenario, we would expect a dampening effect on sales that could look a lot like what we saw in 2023 across REBGV market regions”
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A home sales forecast may be one dominant factor contributing to the 2024 market...but what many buyers, and sellers, are mainly concerned with is home prices...yes the number of purchase options is important to buyers, but if homes are too expensive it does not matter how many homes are on the market.
Looking ahead the REBGV had the following to sale about 2024 home prices:
"While the significant increase in borrowing costs over the course of 2023 led many forecasters to speculate that prices would decline during the course of the year, our modelling work suggested the opposite.
The simple reason for this contrarian view at the time was that that the availability of resale homes was too low to lead to any significant price declines. While resale inventory levels have crept upwards since the mid-point of 2023, a longer-term perspective reveals that inventory is still hovering near historic lows.
For this reason, our 2024 forecast expects prices to continue increasing modestly as increased demand brought about by lower borrowing costs butts-up against a supply-constrained
environment."
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Do you have questions about the market outlook? Are you looking to make a change in 2024?
Reach out today and let us help you navigate through the ever changing market.
Rod & Rhea: 604.240.1927
Ryan: 604.561.2127
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