So in recent updates I’ve said that good properties that are priced well will sell quickly and maybe get multiple offers. Now I’m yelling from the roof top: good properties that are priced well will get multiple offers!!! For a few weeks now I’ve been involved in multiple offer scenarios on a broad spectrum of options: 1 and 2 bedrooms condos in Vancouver, Burnaby and New West, Half Duplexes, Houses and Houses needing a complete overhaul. Admittedly they’re all properties that have a lot going for them, so I haven’t been too surprised that they’ve received multiple offers, but a few scenarios have surprised me given how many offers some have gotten (5+, which certainly feels a lot more competitive than 2-3). How high the final sale price is above the original list price depends on how low the original list price was, so I usually have a good idea, but when a property receives 5+ offers is can be a lot harder to predict. Most of these offer scenarios also include subject free offers, so Buyers are coming in guns blazing in order to be competitive. If you’re not subject free, be prepared to pay more for the property in order to have your offer accepted.
With the new “recession period”, a lot of Buyers are finding it easier to go in subject free since they have the automatic 3 business day recession period to back out if something comes up after. The Real Estate Board wanted to give Buyers are out if they had any regrets in submitting a subject free offer, but it’s now leading more Buyers to submit a subject free that may not have otherwise, that they may not be truly ready to submit, so ironically, Buyers are taking more risks now than they were before. And if they realize they did make a mistake, it’ll cost them 0.25% of the list price.
The March 8th rate announcement was no change to rates, bringing a bit of stability in the markets. Then the Silicon Valley Bank in the USA failed, which led some to suspect that rates may drop quicker than expected. I’m not so sure they’ll drop quicker, but I think it was the nail in the coffin when it comes to future rate increases. Variable rates are all over the map, and fixed rates tend to be in the high 4’s to mid 5’s range. Given the quick changes in the mortgage world over the last year, I wouldn’t be surprised if we see new rules when it comes to financing – whether they come through the regulator or the banks themselves. Anytime things seem to be moving quickly, talk of chnages always comes up (like the recession period for offers!). The Federal Government has already made some slight adjustments to the new Foreign Buyer’s Ban in order to help foreigners who are working in Canada purchase a property, so it isn’t uncommon for new rules to come out and then be adjusted as things change again.
I still have a lot of Buyers who would like to move, if they can find something to buy. Inventory is still lower than it should be at this time of year. I found myself telling Buyers this past month that “inventory will increase after March Break”, which didn’t happen, so now it’s “Inventory will increase after Easter long weekend”, but I’m not convinced anymore. I think a lot of potential Seller’s are still worried about what they might buy (both in what they can afford and also lacking the inventory to feel confident that there will be enough to choose from if they are buying after they sell). This is leading more Sellers to sell after they’ve bought something, which leads them to list their property at a low price to guarantee a sale, which leads to multiple offers. As people hear that multiple offers are more common, I think we’ll started to see a few more Sellers come out of the woodwork, but I don’t think it’ll lead to a rush of inventory or a Buyer’s market.
If you’re looking for a deal, look to areas outside of Vancouver: they slow down first and pick up last, so you can still find some deals in areas like Squamish.
If you’re willing to renovate, now is a good time to be looking. Reno projects tend to sit on the market and are less competitive than something modern, but reno costs are lower than they were and overall timelines are shorter than they have been, so it’s a good time to be considering a reno if you have the means and desire to go through with it.
If you have questions on a particular kind of property and what’s happening in that market, get in touch with me!
As a Buyer, how can you find the best deal? You have to be offering! There are a lot of Sellers out there who won’t drop their price to a low number, but they’ll accept it if it comes. I like to remind Buyers that you need to find the balance between a good deal and a property you actually like, because it costs a lot of money to buy and sell real estate so if you buy a “deal” but want to sell it in 2 years, it could end up costing you more than if you bought the property you really liked that was a little more expensive. You live in your home every day and it has a serious affect on your lifestyle – make sure you choose wisely!
As for Sellers and inventory – I think we’ll see an expected increase in inventory this Spring – but I don’t think it’ll be higher than average. If you’re thinking about selling your property, give me a call to chat about value, pricing strategy and the sale process. There are plenty of details to chat about – including timing, value, staging and your potential purchase – so don’t hesitate to contact me if you’d like to get started kristi@realestatevancity.ca or 778-387-7371. The better you understand your current value and what Buyers may be looking for, the more successful your sale. There is a finesse to dealing with a slowing market.
Here’s a snippet from the Real Estate Board’s Monthly Update:
Home prices across Metro Vancouver’s housing market showed modest increases in March, while new listings remained below long-term historical averages.
March data also indicates home sales are making a stronger than expected spring showing so far, despite elevated borrowing costs.
The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,535 in March 2023, a 42.5 per cent decrease from the 4,405 sales recorded in March 2022, and 28.4 per cent below the 10-year seasonal average (3,540).
The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,143,900. This represents a 9.5 per cent decrease over March 2022 and a 1.8 per cent increase compared to February 2023.
“On the pricing side, the spring market is already on track to outpace our 2023 forecast, which anticipated modest price increases of about one to two per cent across all product types,” Andrew Lis, REBGV’s director of economics and data analytics said. “The surprising part of this recent activity is that these price increases are occurring against a backdrop of elevated borrowing costs, below-average sales, and new listing activity that continues to suggest that sellers are awaiting more favorable market conditions.”
Onto the stats:
Vancouver West Real Estate Stats up to and including March 2023
The sales to active ratio is at least 19% across the Westside, which indicates a Seller’s Market. Be prepared to compete on houses below $3-million, Townhouses under $2-million, 2 beds under $1.2-million and 1 beds under $700k.
HPI Price for Vancouver West
*Unfortunately HPI Price can’t be any more specific than Condo/Townhouse/House*
Average Sales Price for Vancouver West
Median Percentage of Original Price for Vancouver West
New Listings for Vancouver West
Total Inventory for Vancouver West
Total Sales for Vancouver West
Sales to Active Ratio for Vancouver West
Median Days on Market for Vancouver West
East Vancouver Real Estate Stats up to and including March 2023
The sales to active ratio is at least 27% across the Eastside, which is a strong Seller’s Market. Expect to be in competition for any 1 beds under $600k, 2 beds under $900k, 3 beds under $1.5m and houses under $2-million.
HPI Price for East Vancouver
*Unfortunately HPI Price can’t be any more specific than Condo/Townhouse/House*
Average Sales Price
Median Percentage of Original Price for East Vancouver
New Listings for East Vancouver
Total Inventory for East Vancouver
Total Sales for East Vancouver
Sales to Active Ratio for East Vancouver
Median Days on Market for East Vancouver
What questions do you have? Send me an email or give me a call: kristi@realestatevancity.ca or 778-387-7371. I love thinking critically and answering questions, so I’m always happy to help.
Considering that the market is busier than expected, make sure your mortgage approval is up to date and that your mortgage broker can work quickly, if you need to submit a competitive offer. If you haven’t yet spoken with a mortgage broker, get that process started. It’s helpful to know your options when it comes to owning two properties via a bridge loan, getting a 1 to 3 year mortgage amortization, porting your existing mortgage or understanding how any further changes to interest rates will affect you. Times are changing quickly so you need a broker who takes the time to understand your goals and current financial outlook. Email me if you need a referral to a great mortgage broker.