Vancouver Housing Market moving towards stability to start the Spring season
With lots of projects putting on hold. It is not surprising that the construction sectors lost a lot of jobs. People has been predicting that would happen once all the projects complete by 2010 Olympic.. It just came a bit sooner than we expected due to the global economic crisis. Even with all these once again negative news bombarding us, Metro Vancouver housing market experienced a movement away from volatility and toward stability to start the spring season. In the last couple of months, I’ve been encouraging my investors to consider buying in but due to all the negative news from the media forecasting further drop in prices, naturally, all of them were afraid to get into the market.
I, on another hand, try to practice Warren Buffet’s theory “Be fearful when everybody is greedy, be greedy when everybody is fearful!”. I didn’t know if it hits the bottom but the interest rate is so low and the “intrinsic investment value” theory that I’ve been preaching also works, guess what, I bought another investment property.
With all the leaders around the Globe are trying very hard working together to improve the global economy, people seems to see the light at the end of the tunnel though the storm is not over yet. Entry level products are moving very fast right now. For those who are interested in 1BR condo under $350k or 2 BRs under $400k, both Downtown and Burnaby listings are snapping up quickly.
Multiple offer over asking price sales are back. If you are a buyer I'm sorry to say you missed your chance... for now. The opportunity to get a steal of a deal from a desperate seller are probably gone. During our discussion in our weekly office meeting, since February, we have experienced multiple offers again. While not the norm across the board, most areas have at least a couple of segments that are very hot. While I have heard of a couple 5% over asking price type bidding wars there are a lot of multiple offers ending at under or just a little over asking price (ie $1000). These are all because of the Seller finally come around to reality and being willing to sell at today’s prices.
Where are rates going? The Bank of Canada will likely drop the prime rate one more time but that will be it. From the bottom prime can only go up. A low prime for another 6 months might be seen. Fixed rates will likely continue to trend down for the next couple of months but we are getting very close to the bottom.
There were couple of articles on the newspaper last week. One shown the improved market. I have been suggesting to get Buyers writing offers earlier before Seller's get stuck on their pricing. Remember that prices are stabilizing, not necessarily going up. The other articles deals with the transit system. Granted that the suburbs are being built up, commuting into town is a challenge. There really is no plan. This means that the closer to town you are, prices will always be strong. So, if you can, stay in town.
