We are less than a week away from Christmas, and just shy of two weeks away from the New Year. I am just going to let that sink in for a minute…. wow! I would typically just look at November’s Squamish real estate update in this review, however, I think it’s important to take a look at 2022 as a whole, as it has been so dynamic with the shifting market throughout all of Canada and British Columbia.
2022 started off with a bang with a 30% increase y-o-y in the average sales price of a home in Squamish, plus a 30% decrease in the average days on market for a home to sell and the absorption rate for Squamish was sitting at 45%. These are all clear signals of a very strong sellers market. Fast forward through February and March these trends of price increases, days on market falling and a strong sellers market held true. Come April/May, we started to see a shift occur due to the first initial interest rate hike from the Bank Of Canada on March 2nd. But the true effects were felt closer to Summer when the continual rate increases started to shift peoples affordability in the lending world therefore putting downward pressure on housing prices. All in all we have seen 7 rate hikes in 2022 – wow – capping off with the December 7th announcement of a 50 basis point increase to close the year out.
How has this affected pricing, days on market and inventory? Let’s take a look at how November fared in comparison to the year previous.
The MLS HPI Price Index is sitting at $1,035,800 as an average price for a home in Squamish for November 2022, that is down 2.6% from November 2021. The average sales price recorded throughout November was $998,488 (down 9% y-o-y). The average days on market for all property types was 42 days, this is up 162% from November 2021. Total inventory for all homes in Squamish is sitting at 169 active listings, this is over 100% higher than the previous year. Pair that with sales being down 42%, which equates to 30 homes sold in November 2022 vs. 51 sales last November. This puts Squamish at 18% in the Sales to Active Listings ratio, which falls within a balanced market range. The reason why we are still sitting in a balanced market and not a buyers market is due to a decrease in listings, which keeps the slowing sales volume at pace. If we saw an uptick in listings as well as a decrease in sales that absorption rate number would shift quickly into a buyers market (under 12%).
Looking ahead to 2023, I suspect we will continue to see market stagnation continue in January and probably even February. The January interest rate announcement from the Bank of Canada will really set the stage for how our market and consumer confidence will track in Q1 of 2023. It is likely that a balanced market will continue for much of 2023, with activity returning mid to Q3 to Q4.