July Market Update

July’s market update is live! As we head into the dog-days of summer, real estate is still going strong in the Fraser Valley. We are still in a Seller’s Market, with a 43% home selling rate.

There were a total of 4087 active listings in July. This is up from the previous year slightly. There were 1744 sales made in July, which was on par with last year’s sales at this time as well.

One of the most interesting, and still a concern for many first time and buyers in general, was the rise in sale price of 15% from last year. The main issue that is driving prices up continuously is the lack of inventory. Despite a record setting month in construction, there is still a high demand and low supply.

If you would like to see your snap-stats report for your area, get in touch with us and we will set you up!

4 Secrets of Real Estate Investing

The recent boom in BC real estate is getting people excited about real estate investing. Investing in real estate can give you a strong source of income and move you toward financial freedom and the life you have always imagined. Here are 4 key Secrets to buying your first investment property.

  1. Budget—and Stick to It

One of the most important aspects of investing is ensuring you understand your borrowing limitations. Blindly looking at properties before assessing your finances can be a recipe for disaster. Take the time to meet with a qualified mortgage broker to determine how much you can afford to borrow responsibly before you start shopping.

  1. Find the Right Property

Once you have a set budget, you can begin looking for a property. It may be tempting to scour the listings on your own, but working with an experienced local realtor will be a great addition to your team. Working with someone who has first-hand experience in investing will help you find the right property, on budget, in the right area, and provide you a higher return.

  1. Have a Home Inspection Done

Any property you want to purchase should be inspected.  Find a licensed home inspector who will point out any potential problems with the property. This can help you avoid costly repairs down the road. Also, if there are minor updates needed to the home, find a contractor who you can trust can put value back into the property when the time comes to sell or rent it out.

  1. Keep Records of Everything

Keep proper records of income and expenses for your property. Set up a separate, business account so you can easily trace your expenses associated with your real estate investing. This will make tax season and filing a breeze each year.  Along the same lines, if you are buying with a partner ensure you have an agreement in place to protect both of you should things not work out as planned. Have your lawyer draft or review the agreement.

As a bonus tip, it is important to take time to build your “investment team”. Finding people that you can trust and work can make a large impact on your success. To build your network come to our Investors Network Seminar on Tuesday August 15. We are a dedicated group of entrepreneurs who can advise and guide you. You also get monthly training about the real estate market, mortgage changes, and much more!

As always, if you have questions or would like to find the right property, give us a call. Young Real Estate Group is here for you!

How the Bank of Canada’s Interest Rate Hike Will Affect You and Your Mortgage

On July 12, we saw the first rate hike from the Bank of Canada. The rate was raised 0.25% from 0.5% to 0.75%. This was the first increase since September 2010 and more will come this year.  What do these increases mean for your fixed or variable rate mortgage? 

Mortgages

Your home may be the biggest purchase of your life, and anything that could affect the amount you are paying each month is important.

 

For a Fixed Rate Mortgage:

  • Payments for current homeowners stay the same
    • The interest rate on this type of mortgage is fixed so no matter what the Bank of Canada does, your rate will not change until your mortgage is up for renewal.
  • Increase at mortgage renewal
    • If you are at the end of your mortgages’ term, you will have to renew and your rate will change accordingly. This is not all bad news as the rate that you initially had at the start of your term (typically 5 years) may have been higher than the current rate is—even with the rate increase. To check what your future mortgage payments might be, I suggest using GLM Mortgage Groups’ Mortgage Calculator.
  • Higher Rate for Prospective Homebuyers
    • First-time home-buyers may have a higher rate if they are applying for a mortgage. Remember that the Bank of Canada will raise their rates in small increments (0.25%) at a time. Also, each increase translates into around $13 per $100k—an increase that most people can afford (though it may mean sacrificing a coffee run or two per week).

 

Variable Rate Mortgages

  • Your Payments Will Increase
    • A variable rate mortgage moves up or down with the general level of interest rates in the economy. This recent Bank of Canada hike means your mortgage payments will go up, but the amount you will be paying will be affordable, working out to around $13 per 100k
  • Should you switch to a Fixed Rate?
    • Deciding to lock into a fixed rate mortgage, depends on your ability to handle an increase in interest rates over time.  Historically, borrowers who stay in a Variable Rate Mortgage (VRM) tend to save more money over the course of the term. It is important to make an informed decision and to understand how Variable Rate Mortgages work.  Locking into a fixed rate may cost you more money than what an increase in your VRM would be.

The Mortgage Payment Calculator can show an estimated mortgage payment based on a new rate.

So there is no need to panic about these interest rate increases. It is important to stay informed and to budget for them.  The effect these increases will have on the real estate market remains to be seen.  This increase was the first one since 2010 but as we continue to get information we will keep you updated!  If you have any questions, please contact Young Real Estate Group and we can put you in touch with the best professionals out there to help you navigate these mortgage rate changes.

Market Update + What defines a Sellers Market?

The summer heat has spilled over to the real estate market! This month the Fraser Valley remained in a Sellers Market.

Looking at the table above and seeing the ‘sales ratio’ you may ask how those numbers translate into a Seller’s Market. So we thought that this month we would dive into how we determine the market as a balanced, sellers, or buyers market.

First, what is a Sales Ratio? The Sales Ratio is the current inventory of homes that are selling. It is found by taking the number of sales and dividing

Examples:

 10% sales ratio=1 in 10 homes selling rate

33% sales ratip=1 in 3 homes selling rate

Make sense? We then take those ratios and compare them to benchmarks which determine if the market is balanced, favours buyers, or favours sellers.

  • A buyers market would have a sales ratio of 11% or less
  • A balanced market would have a sales ratio of 12-20%
  • A seller’s market would have a sales ratio of 20% or more
Looking at the stats in the table above, you can see that we are in a seller’s market–and have been for the past several months. If you would like to learn more about the stats for your specific area–or are interested in chatting about putting your home on the market get in touch with us today. We would love to meet with you and help you understand what the market is doing in your area!

Must Know Real Estate Stats

https://www.youtube.com/watch?v=XGhY3rf_KYM&feature=youtu.be

 

“While Sales are inching closer to the record-breaking pace of 2016, the market itself looks different…This year, it’s clear that townhomes and condominiums are leading the way.” Says the Real Estate Board of Greater Vancouver.

Market speed for the Fraser Valley is 70% which officially makes it a seller’s market. Total sales last month were 2417 which is 6% less year over year and 22% greater month over month

Median Sale price was at $659,000, which was a 9% increase year over year and a 6% increase month over month.

Active listings were at  3449 which is a 9% decrease year over year and 9% increase month over month.

9 days was the average time on the market. In comparison that is  10% less than a year ago and 10% less than the previous month.

If you are interested in getting the Real Estate Statistics for your specific area, give me and my team a call at Young Real Estate or email us at info@alyoung.ca. We do more than sell your home-we get you the best price!

 

Market Update: May 2017

Another month, another market update! The real estate market in the Fraser Valley has remained a seller’s market over the past month. We have seen average home prices rise, sales inventory slightly increase, and multiple bidding wars associated with many listings. To see last month’s stats for comparison please click here.

Here is what we saw this month for inventory, sales, and sales ratio:

Inventory.png

Surrey had an inventory of 748 homes with 366 sales. This gives a sales ratio of 49% White Rock/South Surrey had 565 homes listed, with 166 sold. Total sales ratio of 29% North Delta had less inventory at 153 homes listed, but 91 sold giving it a sales ratio of 59%. Following that, Cloverdale had the highest sales ratio at 86% with 103 listings and 89 sales. Langley saw 232 homes listed with 183 Selling and a sales ratio 0f 79% (second highest). In Abbotsford, 288 homes were listed, 209 sold giving a high sales ratio of 73%. Last but not least, Mission had a sales ratio of 61% with 138 homes listed and 84 selling.

The upward trend of prices and low inventory continues to drive the market. Homes are selling quickly and for top dollar making this an excellent time to sell. If you or someone you know is selling, please get in touch with us at Young Real Estate by calling: 604-533-3491, or email info@callyoung.com

 

The 3 Reasons the Fraser Valley is a Seller’s Market

At 63% MarketSpeed™ (sales-to-active listing ratio) we are officially in a seller’s market. But the question is: Why?

  1. Sales: 25% less than the previous year, and with an average list price of $623,000 giving us a 5% increase compared to this time last year, and a 2% increase month over month.
  2. Active Listings: Active listings totaled 3169  which is a 15% decrease year over year, but a 5% increase month over month
  3. Days on the Market: Homes were on the market for an average of 10 days in April, which is an 11% increase from last year, and 23% less than the previous month.

All of these factors play into producing a Seller’s Market in the Fraser Valley. If you are interested in learning about the stats in your area please contact us and we will be happy to send you a report!