MARKET UPDATE Every Market offers unique opportunities to clients. For example, this market we are currently in is an excellent time to buy a detached house or land or upgrade to a larger condo. This is especially true if you are selling a condo in order to make the land purchase. We have assisted dozens of clients taking advantage of this window to make this unique upgrade; some to live in, and some for investment. The opportunities in the westside and eastside of our fair city are phenomenal right now, a perfect environment to buy in. As they say “buy up in a down market.” This also holds true for those wanting to upgrade into higher-end strata such as townhomes, duplexes and luxury condos around and above the $1M mark.
In this compressed market, the analogy is best understood by looking at a compressed spring. The once more expensive properties at the top of the spring are much better value now compared to the entry level product at the bottom of the spring that only changed marginally. Plus, the cost for you to sell your current home and upgrade to these properties is lower than ever because the market is compressed. Once the spring is let go, and the market recovers, the jump from the bottom to the top or middle to the upper section is greater, the upgrade gap becomes much larger and the window is missed.
So, do we wait for the market to hit bottom? And when will that be?
Do we really need to wait until the Oct 16, 2021 Provincial Election to see a resurgence of our market? I don’t believe so.
Entry level condos under $700k are super-hot at the moment. We have been generating excellent sales scenarios for clients selling these through our strategic approach and marketing plan generating from two to a dozen offers on our listings as can be seen on the Sales-To-Actives Graph. At the same time, with interest rates being as low as they are, and dropping, many first-time and first-upgrade buyers are gaining a further benefit in this regard taking advantage of the cheap money. The banks are being super diligent in their approval process, but the money is there. As long as you have a job and some cash or equity in your current home you likely have the means.
As the cost to rent continues to increase and the vacancy rate dropped a full percentage point to 3%, many renters are doing the math and discovering it is making more and more sense to buy now. When your rent payment is similar to a mortgage payment for the same property, why would one rent? Further optimism of a potential roll back of the Stress Test in the upcoming Federal Oct 21st election platform is another bright light luring buyers into the market now. BC’s economy is expected to grow by 1.9% this year above what was forecast. New massive projects such as the contentious Trans Mountain Pipeline, the $9.1 billion Vancouver International Airport expansion, and the $3.3 billion dollar SkyTrain extension will both create massive employment and further boost our local economy.
I can’t tell you if the bottom of the market has hit yet, but it certainly is possible that the ‘bell has tolled’ and we just didn’t hear it. Whether it has happened, or we endure another 6 months to a year of this uncertainty, it does not forego the amazing opportunities that await us in our current market. And the only mistake we can make is not act on it, and miss it. It’s time to buy up in this down market and those who do will ride the wave up in their more expensive property for a higher yield than what they were getting by staying put. So, if you have the means to buy up, now is the time to do it. We are here to assist you in this, call us to discuss and plan your next real estate move.