The Real Estate Board of Greater Vancouver (REBGV) today announced
some unsettling statistics in their monthly broadcast of market
information. The leading line reads:
"The number of residential property
sales hit a 10-year low in Greater Vancouver for June, while
prices remained relatively stable."
...and the story was reported in the Vancouver Sun:
These numbers reflect the total number of all residential sales
across Vancouver, comparing June sales figures to June sales figures
in previous years.
Digging into the details reveals a slightly
different picture from Vancouver's westside vs east. Sales figures
are down on the westside, across the detached (51%), attached
(34.3%) and apartment (10.7%) segments, comparing June 2011 to June
2012. However on the eastside, sales for both attached and
apartment properties are up from this same time last year by 2.9%
and 22.7% respectively.
Detached home sales took a beating, and are
down 40% from June 2011.
The number of active listings on the market is higher across all
market segments compared to June of previous years on both the east
and west sides of the city. Despite this, both the attached and
apartment homes on the eastside remain in a seller's market with 4.4
and 4.3 month's supply of inventory respectively. Detached homes in
the east have entered a balanced market at 6.5 months supply.
Again, the westside is softer, with buyer's markets across all
Median sales prices showed moderate increases everywhere from the
same time last year, except for detached homes on the westside,
which fell roughly 14% (and a little over 6% from May 2012).
Overall, supply is up and sales are down, so we should expect to see
some downward pressure on prices, more so on Vancouver's westside.
For how long? No one knows, despite the many predictions and
speculations being thrown around.
Interest rates continue to remain at
record lows. Again, for how long, we're not sure, albeit we
shouldn't expect them to get any (or at least much) lower.
So, let's have a look at that. Using RBC's online mortgage
calculator, I had a look at a $500K mortgage at a rate of 3.06%
interest on a 5 year term amortized over 25 years with monthly payments vs a $450K mortgage with 4% and 4.5% rates
of interest (everything else remaining the same). Looking at these
scenarios, you'll end up spending just over $13,000 more
in interest on the $450K mortgage at the 4% rate, over the 5 year term vs the higher mortgage amount
with the lower interest rate. If the rate goes up to 4.5%, it
becomes almost $24,000 more in interest spent.
Is now a good time to buy? Low interest rates and a good amount of
active inventory would make it favourable. However, only you can
answer that question.
When you, or someone you know, is ready to list or buy a home or
investment property, I look forward to helping you through the
Please don't hesitate to get in touch if you have questions or would
like more information on any of this:
cell: 778 317 9909