REBGV Market Update For June 2018 – Supply Of Homes For Sale Reached A 3 Year High

The highlight of the June 2018 market report released by the Real Estate Board of Greater Vancouver (REBGV), showed that home sales dipped below long term historic averages, and supply reached a 3 year high.

“Buyers are less active today. This is allowing the supply of homes for sale to accumulate to levels we haven’t seen in the last few years,” Phil Moore, REBGV president said. “Rising interest rates, high prices and more restrictive mortgage requirements are among the factors dampening home buyer activity today.”

Home Sales

In June 2018, realtors registered 2,425 residential property sales. This represented a 38% decline from the same period last year, and 29% below the 10 year June average.

The number of detached properties sold was 766, 42% less than June 2017.

The number of apartments sold was 1,240, 34.9% less than June 2017.

The number of attached properties sold was 419, 37.3% less than June 2017.

Home Listings

In June, there were 5,279 new listings of detached, attached and apartment properties added to the Multiple Listing Service (MLS) in Metro Vancouver. This represented a 7.7% decrease compared to the 5,721 homes listed in June 2017, and a 17.2% decrease compared to May 2018 when 6,375 homes were listed.

The total number of homes listed for sale in June increased to 11,947, a 40.3% increase when compared to the same month last year, and a 5.8% increase when compared to May 2018. This is the highest total in the region since June 2015.

Sales-To-Active-Listings Ratio

This ratio is a good indication of the supply and demand forces in the market. Downward pressure on home prices can occur when the ratio dips below 12% for a sustained period, and home prices can experience upward pressure when the ratio is above 20% for a number of months.

For all property types, the ratio in June was 20%, which suggests a balanced market. When broken down by property types, the ratio was:

-       11.7% for detached homes

-       24.9 % for townhomes

-       33.4% for condominiums

Detached homes are entering a buyer’s market zone.

Home Prices

The MLS Home Price index composite benchmark price for all residential properties in Metro Vancouver was $1,093,600 in June. This was 9.5% higher than June 2017 and virtually unchanged when compared to the previous month.

Rising interest rates, high prices and restrictive mortgage requirements, are factors that are dampening homebuyer demand.

Click here for a full report.

If you are planning on entering the real estate market with the present conditions, it is prudent to talk to an experienced real estate company, such as ours, to guide you effectively. Looking to buy or sell a home? Contact us by email or call us on 604 695 1000 or 604 913 1000.

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How US President Trump’s Steel Tariffs Can Have Dire Consequences For The Canadian Construction Industry.

The temporary reprieve we wrote about in March was just that – a temporary reprieve. (read our blog “The Steel Tariffs: We Have A Temporary Reprieve, But Will Trump’s Proposed Tariffs Affect Canadian Real Estate?” ) Last month the unthinkable did happen when US President Donald Trump slapped tariffs on some $20 billion worth of Canadian steel and aluminum.

In March when the Trump Administration first touted the tariffs, the National Association of Home Builders  (NAHB) slammed the plan, which proposed a 25% tariff on steel and 10% tariff on aluminum. “Tariffs hurt consumers and harm housing affordability” Randy Noel, the chairman of the NAHB said.

On July 1, in response to the US tariffs on Canadian steel, Canada imposed a 25% tariff on US Steel imports. The Trudeau government is also said to be preparing quotas and tariffs for other countries to prevent a flood of steel rushing in to undercut prices.

The current tariffs in place will jack up prices for everything from rebar used in high rise condos, to structural steel for industrial builds. This does not bode well for a market that is already facing shortages due to higher demand and soaring prices – the Canadian Coalition for Construction Steel which represents 17 steel making companies laments that the price of steel has already soared by about 38% this year due to a booming property market and lack of supply.

The retaliatory tariffs imposed by the Canadian government have been widely criticised by the steel industry. “If the government’s not careful, they will protect one at the expense of ten times that elsewhere,” said Walter Koppelaar, CEO and Chairman of a large Ontario based steel construction company, Walters Inc. “If they apply duties to broad-spectrum steel or metal of any shape, size or description, our industry would be decimated – it could be thousands of layoffs and it’s going to shut down projects right across the country” he added.

Domestic mills supply roughly 10% of structural steel and about 50% of rebar. Their margins on imported steel are very slim, and the 25% tariff would lead to a lot of hardship and possible bankruptcies.

Locally, the tariffs on steel would hit BC very hard as historically the province has relied on imports for more than 60% of its annual consumption. Expect the cost of building to go up and the increase to be passed on to the consumer.

Buying a home is one of the largest financial transactions you will ever make in your life. So why wouldn’t you trust a professional to do it for you? After all , the seller pays the commission. When you decide to do so, contact us and one of our experienced real estate professionals will help you find your dream home.

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Here’s What You Need To Know About The New Real Estate Rules Recently Rolled Out.

PH9 - 1480 Howe Street, Vancouver   Vancouver House - PenthouseOn June 15, the BCREA rolled out new rules aimed at better protecting both home buyers and sellers. The real estate board mandated an independent advisory group in June 2016 to look at market conduct in view of the white-hot market and all the scandals and shady dealings that were affecting consumers at the time.

As the new real estate rules took effect on June 15th, The Premier of BC, John Horgen said “These changes were designed to protect people that are looking at the housing market and designed to protect good realtors, so that the scammers that were out there don’t discredit all the good people that work in the sector.”

The advisory group drafted over 20 recommendations, the most notable being:

The ban on “dual agency” or “limited dual agency”

What this means is that a professional real estate agent can no longer represent the buyer and the seller in the same transaction, removing any possibility of a conflict of interest. Now the real estate agent will give his/her undivided loyalty to the buyer or seller.

The exemption occurs in remote areas of the province where there are fewer realtors.

Full disclosure of commissions

Real estate professionals are required to make the commissions they receive transparent to the seller if the seller accepts that offer. There must be written disclosure on how the commission will be shared with other brokers, and any other remuneration that may be received as a result of the transaction.

New disclosures to consumers about representation

Realtors must make consumers aware of the risks they face if they do not want to be represented by a realtor and if they do, the benefits of working with a real estate professional: their duties and obligations to a client.

Here’s how recent changes by the real estate board better serve the public:

-       There is an anonymous tip line available.

-       There are harsh financial penalties for misconduct up to $250,000 per licensee and $500,000 per broker.

-       Professional standards advisors are available to help consumers better understand the forms.

-       A formal complaints process has been set up to investigate infractions.

It is important to get the correct advice when you are buying a home. We have been in the real estate business for over 28 years and know just about everything there is about buying a home. Contact us or call us on 604 695  1000 or 604 913 1000 if you are planning on buying a home.

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Thinking Of Helping Your Child Buy A First Home? Here’s How You Can Do It.

Remember the good old days when you began your early independent life with a nice starter home in the suburbs with a small lawn to cut in the summer, and a driveway to shovel in the winter? A few years later you bought a bigger home, moving up in life and work….Not anymore.

Today the average price of a home in Vancouver is well over a million dollars, and with the new mortgage rules, first time homebuyers are hard pressed to ever own a home, unless they get some sort of relief from family or win the lottery.

You may be a parent of a millennial with the heart (and wallet) to help your child get into the property ladder. Here are ways to do it:

1. Make a lump sum payment as a gift.

Pros:

• No tax implications if you are gifting to your child using after tax dollars.

• Simple and straightforward to do.

Cons:

• The gift comes with no conditions attached.

• You cannot demand retroactive payments or conditions.

• You may lose your gift if creditors have a claim on your child’s assets or your child’s marriage breaks up.

2. Become a co-signer or guarantor to a mortgage. This is useful if your child has a poor credit history or doesn’t have enough to cover the monthly payments.

Pros:

• You don’t have to put out your own money.

• You give your child the opportunity to own a mortgage with your help, which will help his/her credit rating in the long run.

Cons:

• If your child cannot make the payments, you are on the hook for the payments.

• The lender can take action against both you and your child.

• If you are the guarantor, the lender will first go after your child, and then after you. This will affect your credit worthiness, which is not a good thing if you have painstakingly maintained an excellent record over the years.

3. Consider giving your child a secured loan.

Pros:

• The loan can be documented and secured to give you the parent, the legal right to enforce payback conditions.

• If the conditions are not met, you can take the matter before the courts, and eventually take control of the property.

• If your child’s marriage breaks up, a secure loan will ensure that your contribution is not lost.

• If you have prior claim on the property through the secured loan, other creditors may not be able to make a claim on the property.

Cons:

• Drawing up the loan documents that will stand up in a court of law will require the use of a lawyer, which represents an expense.

• If the loan is drawn up informally over the dining table, it may not stand up in court.

• Not many parents may actually take their children to court if they default on the loan.

4. Set up a trust.  It stipulates that the child can only use the property in accordance with the terms set out in the trust.

Pros:

• The child can enjoy the home without the need for a mortgage.

• The home is secured from a child’s creditors and the fallout of a broken marriage.

Cons:

• As a parent, you still have to fork out for your child’s accommodation

• Your child will not build up a credit history.

• The legal fees for setting up the trust can be expensive.

Vancouver’s real estate market has been appreciating over the past decade and is still an excellent investment. We are a well-known brand in the luxury real-estate market. Visit our website http://virani.ca to view Vancouver homes for sale and our profile.

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6 Great Ways To Enjoy And Add Value To Your Home

Typically, your home is your most valued possession and investment. Below are 6 ways of improving your property and adding value at the same time. These renovations can sometimes have a return on investment of 5-6 times the initial investment.

1) Add an income suite.

If you have a basement that is not being used, by converting it into a suite will increase your home’s net worth by thousands of dollars. The increase in value will far surpass the investment of the renovation.

An income suite can help cover the mortgage payment, and this is a very attractive proposition to any potential buyer.

2) Remodel your kitchen.

If you are going to do this, then remodel the entire kitchen. Many homeowners just do half and leave the rest for later. When the home is eventually offered for sale, the potential buyer may want to redo it. This may be a negotiating point against you on the price.

If you are planning on staying in your home and want to just do a soft upgrade and not spend too much money, replacing the countertops and re-painting the cabinets are a good way of modernizing your home.

3) Add lighting to your home.

Many homes built 15 or more years ago, when compared to today’s standards, do not have adequate lighting. Adding recessed or can lights have the ability to transform the feel of the entire house.

Skylights are making a comeback, and adding a skylight will allow natural light to enter your home. Natural light permeating through the home is what many homebuyers like to see.

4) Increase curb appeal.

Curb appeal means everything to a home. It is the first thing people see when they drive up to visit you. Fertilizing your lawn every year will ensure that your lawn looks good and stays healthy.

Adding new vegetation in the form of new plants and trees will definitely change the outdoor feel of your home.

5) Maintain or add a deck.

Make sure you stain or paint your deck every 2-3 years. If you are going to paint, ensure that you strip the old paint off, rather than paint over the old coat.

If you don’t have a deck, then adding one will greatly enhance the value of your home, as decks are very popular. Don’t make the mistake of making your deck too small. It should comfortably fit a table for 8-10 people.

6) Update your bathrooms.

This is an important update that can really help improve the value of your home. Make sure you update all the bathrooms, and keep consistency throughout the bathrooms with regards to toilets, counter-tops, faucets etc.

And here’s a simple fix that most homeowners overlook when renovating the bathroom:  reglazing the tub rather than buying a new one. It will save you from buying a brand new tub and upgrade the look of the bathroom.

Looking to buy or sell a home? Use our decades of experience to list your property or buy your dream home. Contact us and one of our experienced real estate professionals will be more than happy to assist you.

 

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REBGV Market Update For May 2018 – Housing Inventory Increased As Supply Accumulated.

The May 2018 market report released by the Real Estate Board of Greater Vancouver (REBGV) noted that reduced demand allowed the housing supply to accumulate across Metro Vancouver.

“With fewer homes selling today compared to recent years, the number of homes available for sale is rising,” Phil Moore, REBGV president said. “The selection of homes for sale in Metro Vancouver has risen to the highest levels we’ve seen in the last two years, yet supply is still below our long-term historical averages.”

Home Sales

In May 2018, there were 2,833 residential property sales. This represented a 35.1% decrease from the 4,364 sales in May 2017 and an increase of 9.8% from April 2018 when 2,579 homes were sold.

The number of detached properties sold was 926, 40.2% less than May 2017.

The number of apartments sold was 1431,  29.3% less than May 2017.

The number of attached properties sold was 476, 39.8% less than May 2017.

Home Listings

There were 6,375 new listings of detached, attached and apartment properties for May 2018 added to the MLS. This represented a 5.5% increase compared to the 6,044 homes listed in May 2017, and a 9.5% increase compared to April 2018 when 5,820 homes were listed.

The total number of homes listed for sale in May increased to 11,292. This is the highest total we have seen in the last 2 years, yet supply is still below long-term historic averages.

Sales-To-Active-Listings Ratio

This is a good indication of the supply and demand forces in the market. Downward pressure on home prices can occur when the ratio is below 12% for a sustained period, and there is upward pressure when the ratio is above 20% for a number of months.

For all property types, the ratio in May was 25.1%, indicative of a seller’s market. When broken down by property types, the ratio was:

-       14.7% for detached homes

-       30.8 % for townhomes

-       41.7% for condos

As a result, condominium and townhome prices continued to rise over last year – One-year change was a 16% increase for town homes and a 20.2% increase for condos. In contrast, detached homes prices increased only 2% over last year.

Home Prices

The MLS Home Price index composite benchmark price for all residential properties in Metro Vancouver was $1,094,00 in May. This was 11.5% higher than May 2017 and 0.1% higher when compared to April 2018.

Click here for a full report.

Working with our real estate professionals will enable you to set realistic expectations that help you achieve your real estate goals. If you are looking to buy or sell a home, contact us by email or call us on 604 695 1000 or 604 913 1000.

 

 

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Are Vancouver’s Priciest Homes Becoming More Affordable?

It was only 2 years ago when Vancouver’s luxury real estate market was one of the best performing in the world.  Today, according to the Knight Frank Global Cities Index, Vancouver sits as the second worst performer over a 6-month period to March 2018.

The April benchmark price for a single family home in East Vancouver dropped by 1.4 % over a six month period, and homes in the more pricey West side of Vancouver dropped by 6% over the same period.

April also saw more inventory in the detached market, but fewer sales (read our recent blog “REBGV Market Update For April  2018 – Fewer Home Buyers And More Sellers.”)

“There’s a lot of supply and buyers have a lot of choice,” said REBGV president Phil Moore. “ I see a lot more price reductions happening in the high price range. There’s a lot more inventory.”

While the townhouse and condo market is still booming, why is there a decline in the detached home market? According to Moore, factors include the new mortgage stress test, the foreign buyers and property transfer tax. “We’re starting to see the trend as the new government intervention policies come into play,” he said.

Kate Everett-Allen, Knight Franks head of international residential research attributed the decline to the province’s “macro prudential measures” and the rising borrowing costs for investors.

Other analysts believe that the decline in prices has more to do with the foreign buyers tax, forcing investors to go down South to cities like Seattle and Portland, and stricter Chinese government capital controls.

While the Mayor of Vancouver and other real estate experts think the decline is a necessary step to restoring some stability to the local housing market, the gains have been so massive for so many years, that the softening of the market was not surprising.

The price of luxury homes may have declined somewhat, but the long-term outlook remains positive. Vancouver is limited by space – mountains and the ocean. The space constraint reduces the opportunities to build more detached homes. As long as Vancouver remains one of the greatest cities in the world, luxury homes will be in demand, as more people (some with deep pockets) will want to move here.

If you are in the market for a luxury home, we have been selling luxury homes for over 27 years. Our knowledge and expertise of the Vancouver real estate market makes us one of the most prominent real estate companies in Vancouver. Contact us or call us on 604 913 1000/604 695 1000.

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Real Burglars and Home Invaders Sharing Their Secrets On Where They Strike and How You Can Avoid Becoming A Target.

When it comes to securing our homes we all think we are doing the right thing by buying expensive alarm systems, installing security cameras, putting our lights on timers, etc. But does any of that really scare the burglars away? Not really, according to a ground breaking survey done on convicted burglars and home invaders serving a prison sentence.

What they shared will probably make you think twice about how you are securing your home. Below are important takeaways that will give you perspective from a burglar’s point of view.

What makes your home a target?

An overflowing mailbox and a clutter of newspapers near the driveway are signals that there is no one home. Get a neighbour or friend to periodically check on your mailbox and retrieve newspapers if you are away.

The absence of a car in the drive way is a sign that the owner is not home. If you have a spare car in the garage, park it outside during the day. Even if you are not at home, the presence of a parked car will be enough to give a potential burglar a doubt that someone could be home.

Unlocked doors and windows allow a burglar to gain easy access to your home. So many owners leave their windows open during the day while they are at work. Ensure that you lock up your windows and doors once you leave home.

What time do burglars usually strike?

Normally after 8am in the morning as everyone has gone to work and the kids are at school, and before 3pm as parents are returning back from school with their kids.

Contrary to popular beliefs, most burglaries are done during the day and very few during the night.

Take comfort that 75% of the thieves surveyed said that they would leave immediately if they found someone at home. It’s the other 25% you should be worried about!

Do alarm systems work?

Not really, according to most burglars surveyed.  Alarm systems alert the burglar that there is no one at home. When an alarm goes off, it usually takes a few minutes before help is on the way: A burglar can be in and out within 2 minutes, and by the time the security company or police arrive, the burglar has disappeared with some of your valuables.

Do security cameras deter a burglar?

It’s easy to put a mask on or block your face with your arm so that the security camera cannot detect your face. A common perception among burglars is that if people have money for security cameras, then there is something they have that they are protecting.

What are the safest deterrents to prevent burglars?

Having a neighbour watch your home was highly touted as a very effective way of protecting your home. Burglars generally avoid streets where there are active neighbourhood watches.

Dogs are a great deterrent too. Hearing a dog barking through the door will force the burglar to skip the house and move to the next one.

If you have any questions on this topic or any other that we have been extensively writing about, contact us and we can give you more insight.

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Now Is The Time To Invest In Vancouver Real Estate, As Amazon’s Expansion Will Most Likely Exacerbate The Current Housing Shortage

At the beginning of this month, Amazon announced plans to convert the old Canada Post site in Downtown Vancouver into its new base of operations, creating 3,000 new jobs by 2022. This will mean that there will be thousands of extra workers needed homes in a city already facing a shortage of affordable housing.

Amazon has been gradually increasing its workforce footprint in the Lower Mainland of BC over the past few years. The current workforce scattered around the lower mainland stands at 1,800 and by 2022 will explode to 5,000. But it will not stop there.

Consider Amazon’s presence in the Seattle metro area where in 2010 the company had 5,000 employees. Today there are around 40,000, making Seattle one of the fastest growing US cities.

According to Zillow, rent increases in the neighbourhoods that experienced the greatest influx of theses workers have risen 65% faster over the past 5 years than areas with the smallest influx.

Then consider the “Amazon effect”. Amazon attracts other companies that also want that talent, so they move their offices closer to the Amazon hubs, and this causes a larger influx of people.

Experts have commented that with Amazon’s higher pay to its tech workers, they will be able to afford higher rents and mortgages, creating more incentives for higher end housing developments. This would crowd out the working class and force them to leave the city.

Vancouver has one of the lowest rental vacancy rates in North America, and the price of a benchmark home has risen 91% over the last 10 years. Despite government attempts to ease prices, real estate is becoming more and more expensive.

Unless there is some drastic policy change that forces a net out migration of people from the Lower Mainland, it seems that we are continuing to experience an influx of population into our beautiful city. So would you not want to become a real estate investor in this market?

We currently have over 70 exclusive listings on our website http://virani.ca

If there is any property that interests you, please contact us or call on 604 913 1000 or 604 695 1000.

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REBGV Market Update For April 2018 – Fewer Home Buyers And More Sellers.

REBGV Report for May 2018The April 2018 market report released by the Real Estate Board of Greater Vancouver (REBGV) noted that market conditions are changing, whereby home sales declined and seller activity increased.

“Market conditions are changing. Home sales declined in our region last month to a 17 year April low and home sellers have become more active than we have seen in the past three years, “ Phil Moore, REBGV said. “The mortgage requirements that the federal government implemented this year have, among other factors, diminished home buyers’ purchasing power and they’re being felt on the buyer side today.”

Home Sales

In April 2018, there were 2,579 residential property sales. This represented a 27.4% decrease from the 3,553 sales in April 2017 and an increase of 2.5% from March 2018 when 2,517 homes were sold.

The number of detached properties sold was 807, 33% less than April 2017.

The number of apartments sold was 1,308, 24% less than April 2017.

The number of attached properties sold was 464, 18% less than April 2017.

Home Listings

April proved to be a busy month for home sellers and they were more active last month than we have seen for many years. There were 5,820 new listings of detached, attached and apartment properties for April 2018. This was much higher than the 4,907 new homes listed in April 2017 and 30% higher than the 4,450 new listings in March 2018.

The total number of homes listed for sale in April increased to 9,822 – a figure well above inventory levels from recent years, but well below pre 2015 levels.

This spring, homebuyers have a larger selection to choose from and less demand to compete against.

Sales-To-Active-Listings Ratio

This is a good indication of the supply and demand forces in the market. Downward pressure on home prices can occur when the ratio is below 12% for a sustained period, and there is upward pressure when the ratio is above 20% for a number of months.

For all property types, the ratio in April was 26.3%. This is down 19% when compared to the same time last year. When broken down by property types, the ratio was:

-       14.1% for detached homes

-       36.1% for townhomes

-       46.7% for condos

Home Prices

The MLS Home Price index composite benchmark price for all residential properties in Metro Vancouver was $1,092,000 in April. This was 14.3% higher than April 2017 and 1.1% higher than March 2018.

Click here for a full report.

Working with our real estate professionals will enable you to set realistic expectations that help you achieve your real estate goals. If you are looking to buy or sell a home, contact us by email or call us on 604 695 1000 or 604 913 1000.

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