Richmond's housing market continues to cool ever so slowly with fewer sales and slightly lower prices for some home types.
However, the number of building permits being issued - for all types of buildings - seems to be on the rise.
Single-family and apartment prices dropped slightly in Q3, but townhouse prices continued on their upward trajectory.
The home price index for Richmond apartments decreased in Q3 to $737,600 (1.7 per cent) compared to Q3 2023 and single-family home prices also decreased to $2,168,800 (0.5 per cent).
On the other hand, townhouse prices have increased to $1,149,400 (2.1 per cent) this third quarter with Greater Vancouver’s HPIs, which have slightly increased across the board year-over-year.
On the other hand, townhouse prices have increased to $1,149,400 (2.1 per cent) this third quarter, according to a Richmond city staff report.
Greater Vancouver’s home price index has also slightly increased across the board year-over-year.
The city staff report also showed the number of residential home sales in Richmond decreased by 26.2 per cent (with 638 homes sold) compared to Q3 2023.
Apartments saw the biggest decrease (29 per cent), followed by townhouses (24.5 per cent) and single-family homes (21 per cent).
This is also suggested by the average time of listings on the market, which have increased across the board on a year-over-year basis this third quarter.
Apartment listings experienced the biggest average increase (26.9 per cent) to 33 days on the market. Townhouses followed with an increase of 8.3 per cent to 26 days and single-family homes at 35 days (2.9 per cent).
At the same time, the number of listings has also increased, which is providing more choice for buyers, said the report.
The sales-to-active-listings ratio sat at 11.7 per cent at the end of September, which was slightly more than 20 per cent last year.
Historically, this suggests lower prices if the ratio is sustained below 12 per cent for longer periods of time.
“This is partly due to ongoing affordability concerns, with many potential buyers still feeling the pinch of higher borrowing costs despite recent rate reductions,” added the report.
Developments rise along with vacancies
Although Richmond’s residential market seems to be in a downward trend, the city’s development market tells a different story.
The number of building permits issued increased by 11 per cent year-over-year in Q3 2024, with 150 residential, 111 commercial and 63 industrial building permits issued this last quarter.
Of these three types, permits for industrial buildings showed the biggest growth, increasing by 37 per cent since Q3 2023. Notably, 531 new housing units (208.7 per cent) were added to Richmond this third quarter.
Increases in construction value (582.5 per cent) to $781.4 million and construction starts to 434 (1.3 per cent) year-over-year also suggest a thriving development landscape compared to Metro Vancouver, which experienced a significant decrease (18.7 per cent) in construction starts.
Richmond’s commercial supply is continuing to grow, but so are vacancy rates.
This third quarter, Richmond’s industrial vacancy rate sat at 1.9 per cent, compared to just over one per cent a year ago, with asking rent remaining relatively moderate as a consequence, explained the report.
This is slightly less than the Metro Vancouver rate, which increased to 2.8 per cent – the highest reported since Q2 2016.
Similarly, office vacancy rates increased slightly to 10.9 per cent; meanwhile, transit-oriented vacancies were at 7.8 per cent compared to last year – asking rents for Richmond offices are the lowest in the region.
This was almost the same as Metro Vancouver’s rate (11 per cent), which increased 12.2 per cent since last year.
“With global conditions influencing local trends, low level economic growth in Richmond is expected to continue throughout 2024,” said the report.
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