What to do in Vancouver real estate? What is happening with this market?!
Well there has been a lot of discussion over the past year about what is happening in the real estate market in the USA...and that has now trickled down to what is happening in the Canadian real estate market..and now to what is happening in the market here in Vancouver BC. If you are interested in what is happening, and you would like more than this brief summary, there was an interesting article in the Vancouver Sun on April 25-it was on Real Estate Myths and Realities.
Vancouver's market has historically been one of good growth, with the growth being unprecedented over the past 6-7 years. The prices of waterfront property usually increase at a higher rate than other types of properties; however, given the limited market with the resources to buy these properties, waterfront homes often take longer to sell than lower priced, non-waterfront homes. Our market has been hot in the waterfront and non-waterfront categories and the worldwide market has been similar of course. The question now is, what is happening with our market? We still have a strong economy, except to the extent that the US situation is affecting our forest industry and US investment. We continue to have high numbers of immigrants coming to the City each year and Vancouver is hosting the Olympics in 2010-making the construction boom even "boom-i-er".
So what is happening? Despite indicators that suggest our market should still be strong, sales have slowed significantly over the first 4 months of the year. In talking to people at open houses and business functions, it seems the public is under the impression that the market is slowing and prices will come down if they wait. It is true, the market is slowing and for the investor, it may make sense to wait. However, for those buying a home that they plan to live in, I am concerned that waiting could work to their detriment. With interest rates low, and rents remaining high, I can't see how it makes sense to wait to buy-which is why I bought a new house a few weeks ago. For sellers who are planning to sell in the near future however, it may make sense to sell now as, even if the market has not peaked, it is likely getting close. I think one is much better off to sell before the absolute peak rather than wait for the peak, miss it and end up selling as the market is moving down. (And again, using my own experience, I currently have two of my own properties listed). This strategy is particularly important for those who are downsizing. If one is moving up it is not as important as presumably if the market goes down 5%, that loss from selling their home at 5% less will be more than made up in dollar value when they move to a more expensive home which has also come down by 5%.....
So bottom line I think is that if we are talking about the principal residence, it is definitely a good time to sell if you are downsizing; not as much of a panic if you are moving up...If you are a buyer, I wouldn't risk further market increases (see Vancouver Sun article April 25/08 re: market analysts are still predicting another couple of years of increases) by delaying purchase of a place to live.
If you are an investor-we should talk as there are a number of other factors to consider-pls feel free to email me!
And of course if you own waterfront, again there are other factors at play as the luxury purchaser usually is not as affected by slight changes in the market as the general public will be...but that is the subject for another blog!