Vancouver Real Estate Market Insight

Those of you who know me, know that I have been particularly ’bearish’ at the way the market has been heading since December 2009.

I have warned that a price correction may be building and that some buyers will be, unwittingly, buying at the peak of the market and some sellers are going to miss the opportunity to sell at prices that won’t be seen again for a very long time.

I counsel and have counselled my buyer clients that the current real estate cycle may be approaching a new price peak. I advise my buyers that they will have to hold their property for several years or risk selling at a loss if they cannot hold the property until the beginning of the next ‘up’ cycle.

For my seller clients, providing accurate, objective up to the minute data and research on the latest sales and market trends is key to a happy client experience in the current market. Right now I am counselling sellers to negotiate a fair deal but not to get greedy, and to exit the market gracefully with their substantial profits.

Here’s why:

Overall: Total listing inventory in the Greater Vancouver area has been rising relentlessly since December. See www.twitter/dreamcityhomes. Sales activity is declining. The overall average price (all property types) is down 3% from March’s to April’s $674,410.

• The average used home price is down 2% to $986,900.
• The average used condo price is down 2.5% from March to $417,800 – lower by 2.5%
• Active used condo listings by +38% (from 4,435 to 6144) and used condo NEW listings (listed in April only) are up by a whopping 91% ! (1,557 to 2995!). Used home NEW listings are also way up by 68% (from 1,816 to 3,011).

(Remember we are looking at *average* prices which are different from the Board’s Housing Price Index (HPI) and perhaps even less reliable that their HPI Index. However, it may herald the start of an overall price trend)

What is not widely talked about is that the implementation of more restrictive mortgage rules on April 19th appears to have put a dent in the market that will probably have a negative effect on prices by the end of the Summer. I know many realtors’ phones, mine included, rang a lot less frequently on April 20th.

There are undoubtedly many buyers out there with great pre-approved rates that are looking to buy soon. But sellers must now work hard to attract buyers away from the competition. In my opinion we are just on the verge of  a brand new Buyer’s market.

I may be wrong. But it looks that way right now. You should back-test these ideas with your realtor and see what they suggest for your particular situation.

Call me if you have more questions…