MARKET UPDATE – SPRING 2015
As I predicted last fall, we have had one of the busiest Spring Market’s on record. March activity was up 38% compared to the same month last year. And detached house prices have been on a steep climb on both the Westside and Eastside. The offshore market is back at full strength for large Westside lots, and the local market has exploded creating a feeding frenzy on Westside entry-level homes, half duplexes, and Eastside houses.
* The HPI benchmarks represent the price of a typical property within each market. The HPI takes into consideration what averages and medians do not – items such as lot size, age, number of rooms, etc. These features become the composite of the ‘typical house’ in a given area.
While sales are increasing, the new listings are decreasing further feeding the rise in prices. This increasing Sales/Listings ratio creates the perfect opportunity to list. If you look at the graphs below you can see how our market pricing is rapidly climbing this year.
Why are prices climbing so rapidly?
Here are some factors to consider when we speak about Vancouver’s real estate market:
» The fall in oil prices negatively impacts Alberta’s economy and housing market. When the going gets tough in Alberta, residents flock to BC in droves.
» The lower Canadian Dollar attracts investors from Asia and the United States
» BC currently has the number 1 economic growth of all provinces in Canada forecasted at 3% for 2015
»BC has delivered a balanced budget for the third year in a row paying its debt down this year by one billion dollars, while the annual deficit of the remaining provinces is expected to break 15 billion dollars
» Rock bottom interest rates make borrowing money so cheap it makes no sense to buy with cash even if you have it.
» Consumer confidence is rising and buyers are much more confident in our economy and the stability of the long-term real estate market in Vancouver.
» When the sun finally shines in Vancouver, there really is no better place on earth to be. We have the ocean, the mountains, good schools, safe neighbourhoods, clean drinking water, a booming free enterprise economy, rock solid banking system, and an ethnic mix creating the flavors and colours we Vancouverites have come to enjoy!
Marty’s magic window – What can we expect? If we have already seen 5% increases in detached prices across Vancouver, it is not unreasonable to expect house prices to increase at least 10-15% this year. As long as that external demand for land continues, and interest rates stay low (and there is no sign they won’t), we can expect a good 3 year run on this market surge.
The Real Estate Timing Analysis
When should I be selling my home? One of the things we cover when we
meet with you is our Real Estate Timing Analysis. We track all the sales data over the past 5 years and tabulate this data into one easy to follow Stats Package that enables us to make informed timing decisions for our clients. When the sales activity patterns are graphed year after year we see definite patterns defining ‘Sellers Markets’ and ‘Buyers Markets’ throughout the year. The interesting point is that the patterns repeat themselves year after year.
Why is timing important? Well, for example, if you were able to time the sale
of your existing home in a Seller’s Market and offset the purchase of your new
home to a Buyer’s market it will mean substantial gains in both the sell and
buy, in some cases amounting to hundreds of thousands of dollars. When we
meet with you we will point out these cyclical markets, advise the best timing approach, and show you the tools we use to make this possible without you having to move twice. Its great stuff!
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REAL ESTATE MARKET UPDATE
The Vancouver real estate market has begun to heat up with a 40% increase in activity for July 2013 in a month-to-month comparison to 2012. As I predicted back in spring, we saw a delayed Spring Market due to the BC elections holding back the high pent up buyer demand. Once the results were in, and some consumer confidence returned, the dam began to open resulting in a hyperactive June/July.
The ‘months supply’ (number of months to clear out existing inventory) metric for Vancouver’s Westside has dropped from a 9 month supply earlier in the year to a 5 month supply today – yielding a strong seller’s market as we approach September. The last few months have been busier than we have seen in 18 months. This rush in sales has cleared out many of the active listings setting the stage for an extremely active Fall Market.
Bottom line is: we are approaching what looks like a heated Fall Market where we can expect some strong appreciation in prices across t
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MARKET UPDATE, first half of 2013
The first half of 2013 has turned out to be sporadic at best. We have experienced, since the beginning of the year, a market revival from January to March with high market activity in many segments, only to have a quiet April, followed by a busy May. The peak activity this year occurred in March. That being said there were various hot spots and cold spots in the Vancouver market.
These hot spots typically had an excellent response with lots of activity (if marketed properly) and sold, in most cases, in multiple offers.
The apartment condo market was hit especially hard again this year with the Westside faring better than downtown. Upgraded houses in the upper end, over $1.6M and into the $2-3M’s, were met with low turnouts and long exposure periods. Once again, new houses were a difficult sell this year. Historically, new houses were devoured by offshore demand. This demand being absent today has created a large over supply of new product sitting on the market relatively untouched.
Interestingly enough we are seeing a very elite crowd from China/Taiwan b