Market Update-May 2018

This month’s real estate stats are in! May was a busy month in Real Estate; with a 33% Homes Selling Rate the Fraser Valley Real Estate Market is still a seller’s market.

However the numbers are down slightly from last month:

  • 4859 Active Listings were listed in May
  • 1591 Sales this month
  • 10% increase overall in Sale Price for Homes

These numbers have fallen slightly due to the mortgage qualificatins hindering buyers capability to increase their buying power. Over the next several months, the impact of these qualifications is expected to soften due to people re-evaluating their budgets and finances to better accomadate these new mortgage regulations.

This article from Re/Max contains a few pieces of great advice on how to better afford a home and set yourself up for financial success!

Here are the breakdown of statistics for the Fraser Valley:

Real_Estate_Fraser_Valley

Give me a call if you would like to chat about the statistics in your area and how we can help get you more!

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Market Update: April 2018

 

April was an interesting month in Real Estate! As the CMHC Chief Economist pointed out:

“The local economy has been very strong with jobs attracting people and increasing demand but without the supply, that demand goes into house price increases.” -CMHC Chief Economist

The increase in demand without the necessary supply leads to an increase in home prices. With that in mind, let’s look at this month’s stats!

The market remained as a Seller’s Market for the Fraser Valley. Total listings came in at 4014 an increase from last year which was 3169.

Total sales this month totaled 1512, a drop from last year’s record of 1989.

However, due to the increase in demand but a decrease in supply the sale price reached 20% above last year’s. The median sale price was at $751,000. An increase from last month’s $719,000.

Inventory

Interested in seeing more detailed statistics about your area? Send me an email or call me and I will get you a copy delivered right to your inbox.

 

What These New Mortgage Rules Mean For You

NEW_MORTGAGE_RULES_2018

If you are one of the 37% of Canadians who are not aware of the new mortgage rules, then this article is for you!

On January 1, 2018, the Office of the Superintendent of Financial Institutions (OSFI) made significant changes to the B-20 guidelines that have significant impact on those looking to purchase a home.

These new changes indicate that all uninsured mortgage borrowers (those with down payments of 20% or more) must now qualify against the Bank of Canada’s five-year benchmark rate (currently sitting at 4.99%) or at their contractual mortgage rate + 2% additional. For example, if your contract rate is 3.34% you must qualify at 5.34%. The purpose of this is to ensure that borrowers can service their mortgage debts as interest rates rise (as they are predicted to do so in 2018).

As some of you may recall, similar measure were issued in October of 2016. The stress-testing regulations at the time only applies to those with an uninsured mortgage (those with less than 20% down). These new rules and updates to B-20 essentially mean that ALL mortgages will have to abide by stress testing.

 

To better understand how this will specifically affect buyers, we spoke with Mortgage Expert, Geoff Lee of GLM Mortgage Group and he broke it down for us in the table below*

Picture1*based on a dual income family making a combined annual income of $85,000

As you can see, your borrowing power is drastically changed. You are able to borrow $105,000 less with these new changes, meaning you qualify to purchase a home worth $105,000 LESS than before these new rules were introduced.

However, this is not all bad news for first-time buyers. This can effectively cool a relatively hot market here in the Fraser Valley and Vancouver. It can also limit the competition and allow for more buying options for buyers who are able to put the 20% down and pass the stress test.

This announcement also comes at a time when condo and townhome development is at an all-time high, providing affordable, accessible housing options for many buyers.

Buyers can also look to accommodate these changes by laying out a budget and sticking to it! Re/Max has a great layout for this:

  1. Maintain a financial buffer of at least three to six months, to soften the blow of interest rate increases and unexpected bumps in the road.
  2. The mortgage you qualify for and what you can actually afford are two very different things. Look at your lifestyle, now and in the future, and consider how your mortgage payments and ongoing home costs will impact you. When buying a home, you might have to make some compromises on lifestyle in the interest of homeownership.
  3. Buying a home involves more than just mortgage payments. Ongoing expenses include maintenance, home insurance, property taxes, and utilities.

Entering the market in 2018, or looking to purchase a new home need not be a stressful or worrisome experience. We work with some fantastic brokers who can help you get a sharper rate and we can help you find your next home well within your budget. Give us a call today and let us help you: 604-533-3491.

RE/Max 2018 Housing Market Outlook

2018 is almost here, and with it comes many questions regarding the 2018 Housing Market. The following is an excerpt from RE/Max Canada’s 2018 Housing Market Outlook report. If you would like to discuss more, I would be happy to sit down with you! My email is info@callyoung.com and phone: 604-533-3491

Read through the report and get in touch with us if you have further questions!

RE/Max Report

“THIS PAST YEAR SAW THE SINGLE-FAMILY DETACHED HOME AND CONDO MARKETS DIVERGE ON DISTINCTLY DIFFERENT PATHS IN CANADA’S TWO HIGHEST-PRICED REAL ESTATE MARKETS, GREATER VANCOUVER AND THE GREATER TORONTO AREA, AS REVEALED IN THE 2018 HOUSING MARKET OUTLOOK.

The trend is expected to continue into 2018 as a mix of relative affordability for condo units and price appreciation for detached homes in recent years, combined with government policy changes in both markets, has helped push an influx of buyers toward condo ownership.

In Greater Vancouver, demand for condos continues to outpace supply, resulting in the average price of a condo rising an estimated 16 per cent year-over-year, from $553,604 in 2016 to $643,778 in 2017. The GTA’s condo market also saw price appreciation of 22 per cent in 2017, as the average sale price for a condo rose to an estimated $523,437, up from $429,241 in 2016. As condo prices rose, sales for single-family detached homes declined 25 per cent in Greater Vancouver and 22 per cent in the GTA year-over-year between January and the end of October 2017.

The RE/MAX 2018 average residential sale price expectation for Canada is an increase of 2.5 per cent as the desire for home ownership remains strong, particularly among Canadian millennials.”

Click HERE to read the full report and summary

Market Update: November Stats

The November Fraser Valley Real Estate Stats are in! This November saw a steady stream of listings and the price-points of homes remained stable from October. The market remains to be a SELLERS MARKET with a 45% Home Selling Ratio.

The stats for this month were:

  November 2017 Stats October 2017 Stats November 2017 Stats
Number of Listings 3410 3674 3692
Sale Price 675, 000 668, 000 586, 000
Total Sales 1523 1642 1111
Days on Market 16 16 26

 

The BC Real Estate Association was quoted as saying “The combination of weakening consumer demand and a surge in new home completions next year is expected to induce  more balanced market conditions, producing less upwards pressure on home prices.”

As stated above, a more balanced market is expected to occur in 2018-essentially having prices level off and inventory become more readily available. This is excellent news for buyers wanting to break into the market.

One final consideration for December and 2018: The new mortgage regulations. These new regulations will effect many by reducing their borrowing power up to 20%! They come into full effect as of January 1, making now an advisable time to buy or sell a home!

If you are interested in learning more about the stats for your specific area/location, please give me an email or call and we would be happy to send them your way.

What’s just Happened in Real Estate?

If you look at any major news site at least one of the headlines will be about Real Estate. With the Bank of Canada’s rate hike 2 weeks ago, along with low inventory, and fast-moving sales, real estate today can be confusing for the typical consumer. To make things easier on you, we’ve examined 3 trends and market changes that have created the current state of real estate.

 

  1. Bank of Canada Rate Hike.

On September 6, the Bank of Canada quietly raised its interest rate another 0.25%. This brought the rate up from 0.75% to 1%. Why did this happen? With Canada’s record year of economic growth, a higher interest rate is needed to cool the economy and ensure that inflation doesn’t get out of hand.  This can also have implications on mortgages. The lending rate of variable mortgages is tied to the Bank of Canada’s prime lending rate and it can impact the amount of homeowner’s payments. For more about interest rates and how they affect you click HERE.

 

  1. Continued Low Inventory

According to my Snap-Stats, in August the total number of listings was down from last year. The total listed homes came in at 3,884 this year, compared to 4,174 in 2016. This is an ongoing trend in The Fraser Valley and Metro Vancouver detached home market. As fewer homes become available, pricing continues to push upward. This is great for sellers but creates the perfect storm for buyers looking to get into the market.

 

  1. A Shift to Townhomes and Condos

August Sales numbers were pushed above average levels due to a demand for condos and townhomes. Last month, 3,043 residential properties sold, marking a 22.3% increase compared to 2,489 sales in August of the previous year, and a 2.8% increase over this July. When compared to the August sales average from the last decade, 2017 sales were 19.6% above average. This surge in sales in Metro Vancouver is being led by first time homebuyers looking to buy property listed between $350k – $750k.  With demand rising, developers are working to keep building, and many new developments are planned for 2018.

 

The Metro Vancouver and Fraser Valley real estate markets continue to change. Each day new statistics show that we are currently in one of the best markets for sellers, and also one of the most difficult for 1st time homebuyers. However, to the buyers – do not get discouraged! At Young Real Estate Group, we are committed to helping you find the right home in your budget – no matter what it takes. For those thinking to sell, don’t hesitate. Now is one of the best times in Real Estate to place a “For Sale” sign in your yard.

To learn what your home is worth, or to buy a home, please contact us. We happy to serve you whether you’re selling or buying. Call us at 604-533-3491 or email by clicking here.

Guest Post: The Top 10 Latent Defects in Home Inspections

We are excited to have one of the sharpest Home Inspectors with us today! Say hello to Daniel Fedosenko of Mr. Home Inspector Ltd! Daniel has been in the industry for a number of years and has a wealth of knowledge when it comes to home inspections. From Vancouver to Hope and everywhere in between they are helping homeowners check off all the boxes when it comes to home inspections. So without further ado, take it away Danny!

I have worked with Alistair Young and his team for a number of years. At Mr. Home Inspector our goal is to:

  • Offer solutions to issues/challenges (not just reported problems)
  • Go above and beyond the call of duty, and
  • Provide exceptional customer service in the Lower Mainland (from Squamish to Hope).

Today, we wanted to cover the topic of Latent Defects.  Latent defects are those which would not be revealed by any inquiry which a purchaser is in a position to make before entering the contract. Here are the top 10 Latent Defects that you may miss if you don’t have a proper home inspection done!

  1. Bathing area moisture issues behind tile surrounds: water damage.
  2. Pest infestation in attic, crawlspace, and or living areas: damage and air qulity issues can arise.
  3. Plumbing issue: polybutylene pipes with plastic fittings 1978-1995 years installed. Water damage and insurance issues, extra costs
  4. Hidden water leaks: ceilings, walls, or floors: water damage and extra costs will occur.
  5. Grade levels around homes too high up onto the structure: structural rot and extra costs will occur.
  6. Electrical panel size 60 amps: causes insurance issues and extra costs to upgrade the panel size to minimum 100 amps.
  7. Poor ventilation in attic causes mildew/mold in areas: air quality issues and extra costs to treat area.
  8. Toilet tanks by Crane manufactured between 1980-1991 (tanks prone to crack): water damage
  9. Basement and crawspace water leakage issues: water damage and extra costs to address.
  10. Aluminum wiring 1960’s to 1970’s: expands and contracts and loosens and can cause a fire.

There you have it folks–these 10 defects can be avoided by having a home inspection done before you move into your new home. Get in touch with me and my team today, we promise to help you find any issues and find a solution!