Balanced markets emerging
If you’ve been reading this blog lately, or just watching the For Sale signs on your street, you know that the Vancouver real estate market has come back to life. In a number of recent posts, I’ve pointed out that this resurgence began with the reappearance of the first-time home buyer into the Vancouver real estate market.
“The majority of the decline in home prices has already occurred,” Cameron Muir, the chief economist for the BCREA said in a press release. “Balanced markets are emerging in Victoria, Vancouver and the Fraser Valley. There’s now little downward pressure on home prices in these area.”
Affordability piqued in April
According to the BCREA housing affordability in BC piqued at a three-year high in April 2009 when a combination of low home prices and low interest rates resulted in carrying costs for an average home dropping 24% over the previous year.
Imagine that. In just one year, homes were on sale for a 25% discount. That’s a very, very significant savings and it’s absolutely no wonder that droves of first-time buyers (as well as investors) have come back into the market.
“A significant increase in affordability has brought many first-time buyers into the market,” added Muir. “First-time buyers were largely absent in the late fall and winter, making it more difficult for move-up buyers to sell their current homes. The chain of ownership is now being oiled.”
An anecdote with multiple offers
What kind of affect is this resurgence having in the market? Let me illustrate with a personal anecdote.
After a long day of work this past Sunday I went back to my downtown Vancouver Royal LePage office to write up an offer for a client that I’d met at my open house at King Edward Village. Usually, our real estate office is pretty quiet late on a Sunday evening.
There were three of us this night and all of us were writing offers for eager buyers. Every one of us were also writing offers for properties that were in multiple offer situations (where more than one interested party had written an offer on the listed property). One listing had 15 offers, one had 9 and the other had 2…at a time where most people think we are in a buyer’s market.
Demand is rising while supply is falling
This goes to illustrate the fact that there are a lot of ready buyers in the Vancouver real estate market right now. While people are willing to buy, there is very little in the way of quality properties that are appropriate for first-time buyers and investors. In fact, we have the lowest number of active listings on the market right now in well over a year.
Many are competing for the few, and this has halted the downward pressure on prices. In fact, we may be seeing the beginnings of upward pressure.
|
|
|
|
|
|
Related posts:
