Posts

Vancouver Housing Sales Lowest in 18 Years

/in , /by

Another sign that the Metro Vancouver real estate market has flattened, as home sales in July dropped to their lowest level in nearly 30 years. Catherine Urquhart reports.

The number of real estate sales in Greater Vancouver hit its lowest level since the year 2000, according to data from the Real Estate Board of Greater Vancouver (REBGV).

What’s more, condo prices dropped for the first time since January 2017.

According to the real estate board, there were 2,070 property sales in total in July, down 30.1 per cent from July 2017, down 14.6 per cent from June of this year, and nearly 30 per cent below the 10-year average for the month of July.

“With fewer buyers active in today’s market, we’re seeing less upward pressure on home prices across the region,” said REBGV president Phil Moore in a media release.

“This is most pronounced in the detached home market, but demand in the townhome and apartment markets is also relenting from the more frenetic pace experienced over the last few years.”

Moore added that the summer months are always slower in real estate, but that the trend is particularly pronounced this year.

“With increased mortgage rates and stricter lending requirements, buyers and sellers are opting to take a wait-and-see approach for the time being.”

The biggest dip, as in recent months, has been in sales of detached homes.

The REBGV says 637 such properties were sold, down 32.9 per cent year-over-year. The benchmark price for a detached home sits at $1.588 million, down 1.5 per cent from July 2017, and down 0.6 per cent from June 2018.

Condo prices dip

But there are also signs of a cooling in the region’s white-hot condo market as well.

The REBGV says 1,079 units moved last month, down 26.5 per cent from July 2017. The regional benchmark price for a condo unit now sits at $700,500, up 13.6 per cent from July 2017.

However, that figure is down 0.5 per cent from $704,200 in June, and marks the first time condo prices have dropped from one month to the next since the beginning of 2017.

Vancouver realtor Steve Saretsky, who watches the condo market closely, said he’s not surprised to see condo prices start to falter amid tighter mortgage rules and a slew new B.C. taxes aimed at cooling the housing market.

“The detached market has been correcting for two years now, and it really shouldn’t come as a surprise that the townhouse and condo market is now following suit,” he said.

With detached home prices continuing to slide, Saretsky said many people who might have been pushed into the condo market for affordability reasons may be back in the market for a bigger property.

“At some point, you have to look and say, ‘Why am I spending a million dollars on a two-bedroom condo?’” he said.

“At some point it just doesn’t make sense.”

READ MORE: A Greater Vancouver condo now costs nearly as much as a house 4 years ago: Royal LePage

He said stalling condo prices at the high and low end of the market are also discouraging speculators, and their exit is, in turn, further reducing price pressures.

Saretsky said it’s not clear whether prices will continue a steady downward trend. But he said the combination of reduced demand and a large amount of new supply coming on the market are likely to create favourable conditions for buyers.

Source: Global News

Supply of Homes Hits 3-Year High

/in , , /by

The supply of homes in Metro Vancouver’s real estate market hit a three-year high as sales dipped below historical averages last month.

The Real Estate Board of Greater Vancouver reports there were 2,425 home sales last month, a 37.7 per cent decline from June 2017.

Board president Phil Moore says rising interest rates, high prices and more restrictive mortgage requirements are among the factors dampening home buying activity.

Moore says that has allowed the supply of homes for sale to reach levels that they have not seen in the past few years.

There were 5,279 detached, attached and apartment properties newly listed for sale in Metro Vancouver in June, for a total of almost 12,000 for sale, reaching the highest listings figures since June 2015.

The composite benchmark price for all residential properties in Metro Vancouver is $1,093,600, representing a 9.5 per cent increase over June last year.

Watch and read more on this article here: Supply of Homes Hits 3-Year High!

3 Things You Didn’t Know About a Mortgage in BC

/in , /by

Mortgage: You either have one or you’ve heard of one. And if you’re in the latter group, maybe you’re at a point where you ought to learn more. But it can be intimidating as a first-time buyer, if not downright terrifying, to admit your ignorance about such a big, seemingly important part of adulting.

It’s never too late to learn the basics about mortgages and mortgage pre-approval, especially in a place as real estate-focused as BC.

Get ready to learn, and read along.

Rejection isn’t the end

There are three insurers in Canada that provide high ratio mortgage insurance, CMHC, Genworth, and Canada Guaranty. If a lender receives a decline from an insurer due to the property, lending policy dictates they can’t proceed with the application. That doesn’t mean you can’t approach a new lender to try through a different insurer.

Working with a broker can be beneficial in these cases because they have the ability to work with different lenders if necessary. What may not fit policy for one lender/insurer, may be acceptable to another. Sometimes you go through all three insurers before you find the right fit.

Situations where a property may not meet an insurer’s guidelines include (but are not limited to): age, location, square footage, and/or overall condition.

Rental property purchase vs. owner occupied purchase

The lending environment now emphasizes the difference between financing for a rental property and financing for a property that is owner-occupied and/or a second home. The financing rates are lower for owner-occupied properties, because this lending scenario is deemed to bear the least amount of risk for the lender.

If your purchase agreement is written with possession that honours an existing tenant agreement, it will be treated as a rental purchase. If you are relying on high ratio approval (less than 20% down, for example) you will need the purchase agreement to be written with vacant possession. Rental property financing is approved with different lending guidelines due to the difference in risk for the lender. Financing for a rental purchase requires a minimum downpayment of 20%, and the available interest rates are higher.

Purchasing a fixer-upper

If you want to purchase a home that needs a bit of TLC, there are purchase + improvement programs that can help. Generally, this is for improvements up to $40,000. This type of financing must be arranged at the beginning of the approval process, so you might need a little extra time for your subject to financing. Keep this in mind when you’re writing your Offer to Purchase and let your realtor know.

The lender will need written estimates/quotes for the work that is to be done, and these are submitted up front in the process, along with your income and downpayment documents. The lender will issue an approval based on the higher value after the improvements, but will hold back the additional funds until you can provide confirmation that the work is 100% complete. The lender may request an appraisal of the property and copies of the paid quotes to confirm the Improvements are complete. You are reimbursed through your lawyer or notary’s office once the lender is satisfied.

Source: Daily Hive