July 2022 - Latest Market Update

It’s All About Inflation

Everyone at this point has heard about the rising costs of goods and services including the rise in mortgage and interest rates.   And it’s just not a Canada thing.  We have not been threatened by inflation in many decades, and for many young adults, this is all a new world.   Governments have been obsessed with controlling inflation because it can be very destructive.  

Mortgage rates have nearly doubled since last year.  This is an alarming increase in such a short period of time.   It’s very hard to predict what the lending environment will be next year or five years from now, but this inflationary pressure may stay around longer than we hope.     

Everyone’s situation is different and there is no one answer for everyone. Here are some of my recommendations:

Mortgage lending:

• Consider the mortgage features as much as the rate.  Flexibility to stagger terms, pre-payment privileges and other such features like convertibility options become very important. 

• Consider other fixed terms rather than the popular 5-year term.

• Take advantage of b-weekly payments and other pre-payment privileges.  Little things can make a huge difference in paying down your balance. 

• Consider mainstream lenders such as a major Financial Institution.  Often, they are in a better position to help clients when needed. 

• Do not carry credit card or expensive debt.  Convert these debts into your mortgage now while home prices are high and before it becomes harder to qualify. 

Real Estate:

• If possible, delay listing your home to sell.  Sales have dropped significantly over the past few months and prices, as much as they lag; have already begun to soften.  

• If you must list your home for sale do so with a solid plan and strategy and make sure it’s followed. Consider what other homes you may be competing with in your neighborhood.

• A great visual appearance has always been important, but it’s even more so now.  And not just inside of the home.  The outside appearance your home is the first impression for a buyer when they visit. 

• Buyers should take advantage of softening conditions and jump into the market.  When the market softens, it’s common to believe it’s going to soften forever but history tells us differently. 

• Offers no longer need to be ‘condition free’ and buyers can spend more time on due diligence and satisfying their purchasing decision.  Remember, don’t wait to buy real estate, but buy and wait.  

Many households will be challenged during these Inflationary periods. 

“Control your expenses and prioritize improving your savings.  Have confidence in our Real Estate market but be cautious.”

April 2022 - Latest Market Updates

It’s All About Inflation

Are the days of cheap money and deflation over? Interest rates continue to rise and are much higher than they were this time last year. Canada and many other countries are experiencing a concerning inflation trend. Housing, food, gas and much more have been rising steady and in some cases are becoming a real concern. At the last measure the inflation rate was at 5.7%; a rate not seen in 30 years.

Consumer debt has been recently reported at $2.8 trillion with 70% of this debt held as a mortgage. Increases in the interest rate not only increases the borrowing costs for many Canadians but can lead to changes in spending habits. I’ve seen reports showing that 75% and more of Canadians are spending less on such things as household items, dining out and buying less expensive groceries.

Decreased consumer spending can often curtail inflation, however; the inflation is being caused by such things we cannot control. (of course, this begs the question of why is the Bank of Canada increasing rates to try and control something they can’t?) Supply disruptions, employment behaviors and war are outside of our control and can all be very inflationary. Increases to interest rates (and taxes) will only add to these pressures.

Mortgage rates are surging higher.

I strongly recommend anyone considering a refinance to consider it now and not wait especially if you have other debts to consolidate. It may also be the time to consider converting a variable rate mortgage to a fixed rate. Mortgage rates are expected to rise significantly this year. The good news is this should reduce the impact of penalties charged by lenders to refinance or a full payout.

---

Special Announcement

It is with great pride and honor to announce two new alliances with two very successful professionals. 

Bill Parsons (Formally a REMAX hall of fame recipient) is one of the most successful and experienced realtors in BC.   Bill Parsons and I will be working together to help clients with their real estate goals.  I’ve known Parsons for almost twenty years and I’m confident that his forty-two years of experience and success will allow me to exceed clients’ expectations and continue to deliver great results. 

Rebecca Harrap (Mortgage Professional with Verico) is also one of the most knowledgeable and experienced mortgage brokers in Lower Mainland.  My alliance with Rebecca will allow me to continue to provide mortgage and financing solutions to clients.  Whether it’s accessing private financing or battling with the big banks, we now have better and more options for borrowers. 

---

The latest real estate stats are out and prices continue to climb higher ……click her for latest report: Download the March 2022 stats package.

The BC Government is now set to amend the Property Law Act to allow a ‘Cooling off’ period allowing buyers to backout of a purchase contract. Only a few details are known at this time but more on this will be available in the coming weeks. The new law may have unintended consequences that may affect all parties to a real estate transaction; however, it looks like more of an impact to sellers than buyers.

This new law may not do anything to increase inventory levels or stop the increase in housing prices, but there will be more to report on this as we move into the Spring market.

Fixed mortgage rates are much higher than they were just a year ago. Fixed rates have basically doubled from the lows of 2020. Currently 5-year fixed rates can be offered as low as 3.59% and as high as 3.89% depending on lender and product. Variable rate mortgages can be offered as low as 2%.

January 2022 - Latest Market Update

2022 Will Be The Year of UP

BC tax Assessments are out in the mail and are available online.   I think most homeowners will be quite surprised by the increase in their tax assessed values. Some homes have increased up to 35% over last year and most are seeing nothing less than double digit increases.  

Metro Vancouver’s housing market remained very active again for the last month of 2021.  We are nearing record low levels of housing supply, and this is pushing prices way up.  It’s not just pent-up demand and low inventory causing prices to rise, but the cost of construction materials and labour have also risen substantially.     

Inflation is expected to remain elevated for the first half of 2022 and the recent spike in COVID cases and severe weather will likely cause inflation to continue its upward trend.

The Real Estate Board of Greater Vancouver reports that residential home sales in the region totalled 2,688 in December 2021, a 13% decrease from the same month last year and decreased 22% from November 2021.  

Last month’s sales were 33% above the 10-year December’s sales average.

The number of homes available for sale last month decreased 19% compared to the same period last year and dropped almost 51% from November 2021. 

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver increased 17% from same period last year and is currently $1,230,200.

The benchmark price for a detached home increased 22% from same period last year and is $1,910,200, up 2% from November 2021.   

The benchmark price for apartments increased 13% from same period last year and is $761,800 up modestly from November 2021.    

The benchmark price for attached homes increased 22% from same period last year and is $1,004,900, up modestly from November 2021.    

Fixed mortgage rates are much higher than they were just a year ago. Fixed rates are up at least 50% from last year.It is expected that fixed mortgage rates will rise this year; how much; hard to say, but I believe we may see most terms in the 3% range.  The biggest move may be with Variable rate mortgages. The Prime rate is not expected to remain at its historical low level and should increase by at least 30% this year.

Currently 5-year fixed rates can be offered as low as 2.59% and as high as 2.89% depending on lender and product.  Variable rate mortgages can be offered as low as 1.35%. 

November 2021 - Latest Market Update

Housing supply continues its downward trend

Metro Vancouver’s housing market in October remained very active amongst the continued decline in the number of homes available to purchase.  This lack of supply and strong demand continues to push prices higher.      

The Real Estate Board of Greater Vancouver reports that residential home sales in the region totalled 3,494 in October 2021, a 5.2% decrease from the same month last year but increased 11% from September 2021.   

Last month’s sales were 22% above the 10-year October sales average.

The number of homes available for sale last month decreased 35% compared to the same period last year and dropped almost 13% from September 2021.  

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver increased 15% from same period last year and is currently $1,200,000, up modestly from September 2021.   

The benchmark price for a detached home increased 21% from same period last year and is $1,850,500, up modestly from September 2021.   

The benchmark price for apartments increased 10% from same period last year and is $746,400, up modestly from September 2021.    

The benchmark price for attached homes increased 19% from same period last year and is $975,000, up modestly from September 2021.    

Fixed mortgage rates are on the move up.  This was unexpected a few months ago but the recent surge in inflation has caused great concern in the cost of living.  Best 5-year fixed rates can be offered as low as 2.34% and as high as 2.59% depending on lender and product.  

Variable rate mortgages can be offered as low as 1.35%.  This offers the absolute best rate and payment, but there is now increased risk of the prime rate rising within the next six months.     

We currently have many lenders with money to lend out.  Financing highlights as follows:

• Large 1st mortgages -$1M+ 

• 2nd mortgages up to $3.5M 

• Fast closings 

• Pre-construction using current market value 

• Rural properties including acreages 

• 3 year Reverse Mortgage 

• Unique property types considered: leasehold, commercial, partial interest, bare land… 

NOTE: The low mortgage rate environment, low housing supply and the steady demand for homes should push prices higher this Winter season.

September 2021 - Latest Market Update

Housing supply is the biggest factor impacting the market

Metro Vancouver’s housing market in August remained active amongst a continued decline in the number of homes available to purchase.  This is creating a huge challenge for buyers and the trend of increasing prices continues to rise.

The Real Estate Board of Greater Vancouver reports that residential home sales in the region totalled 3,152 in August 2021, a 3.4% increase from the same month last year but decreased 5% from July 2021.

Last month’s sales were 20% above the 10-year August sales average.

The number of homes available for sale last month decreased 30% compared to the same period last year and dropped almost 9% from July 2021. 

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver increased 13 percent from same period last year and is currently $1,176,600, up modestly from July 2021.   

The benchmark price for a detached home increased 20% from same period last year and is $1,807,100, up modestly from July 2021.   

The benchmark price for apartments increased 8% from same period last year and is $735,100, down slightly from July 2021.    

The benchmark price for attached homes increased 17% from same period last year and is $952,600, up slightly from July 2021.    

Mortgage rates remain stable and are expected to remain as these low levels until late in 2022.  Best 5-year fixed rates can be offered as low as 2.15%.  

Variable rate mortgages can be offered as low as 1.45%.  

We currently have many lenders with money to lend out.  Financing highlights as follows:

• Large 1st mortgages -$1M+

• 2nd mortgages up to $3.5M

• Fast closings

• Pre-construction using current market value

• Rural properties including acreages

• 3 year Reverse Mortgage

• Unique property types considered: leasehold, commercial, partial interest, bare land…

NOTE: The low mortgage rate environment, low inventory levels of properties for sale and the steady demand for homes should push prices higher this upcoming Fall season.