Public sees light at the end of the tunnel!
Recently,all the newspapers and media headlines are way more postive with "Things are getting better", "Canada's economy might have bottomed out already. If not, it will likely do so within months", etc. It's harder and harder to resist being optimistic about the economy. The gain of more than 35,000 jobs in Canada last month was contrary to all forecasts. Remember economists back in December 2008 predicted our housing price was going to drop minimum another 15%, then in Feb changed to 19% or higher and yet, I never bought into what they said. I know I am a very optimistic person but that's not the reason. It was the conclusion after talking to people internationally, understanding their mentality, glue to the economic & political news on a daily basis since Sept, plus my 17 years of investing real estate experience. Instead of being negative and follow everybody's believes, I always believe as big the global economic tsuinami as we have since the Great Depresson, the sooner it'll get better because this time affects all the wealthy people around the globe. I can't imagine they allow this to drag on and keep watching their net worth goes down.
Obama praised Canada's banking system at the beginning of May when he had the interview with Toronto Star. Do you know Canada's five largest banks now are among the 50 most valuable in the world. A decade ago, none were in those ranks.
I've been meeting buyers after buyers everyday. Those who has money doesn't want to put their money in the bank with next to nothing interest. With the incredibly low interest rate that we are enjoying, real estate investment cap rate lies between 5%-7%. For that reason, they are all coming out from the cave and start buying real estate again when the news are announcing more & more postiive news. For the sixth consecutive month, new listings for detached, attached and apartment properties declined in Greater Vancouver, down 33.7 per cent to 4,649 in April 2009 compared to April 2008, when 7,010 new units were listed. The total number of property listings on the Multiple Listing Service® (MLS®), while slightly down compared to last month, remains unchanged compared to the same period in 2008.
The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in Greater Vancouver totalled
2,963 in April 2009, a decline of eight per cent from the 3,218 sales recorded in April 2008, and an increase of 31 per cent
compared to last month. The bridge between buyer demand and housing supply is continuing to narrow, which, as we see, helps bring stability to home prices.
Just remember like anything, the real estate and stock market cycle goes once every 10 years. When this one is over, I'm sure we'll have something new in 10 years time. Back to the old saying, don't panic and invest your real estate long term in the same manner as you put money into the RRSP which doesn't allow us to take it out till we retire. The difference is your real estate value is unlikely to go down half like some of our RRSP accounts does this time. The best deal is over, now it's the matter of the buyer gets into the market before it takes off again.
