Record Real Estate Sales for July in the Lower Mainland
July was a good month for real estate in the Lower Mainland. As first time home-buyers were drawn out by lower prices and interest rates both Metro Vancouver and the Fraser Valley saw impressive sales figures for the month of July.
Statistics show that realtors in the Lower Mainland inked 4,114 sales in July of 2009 which is nearly a 90 per cent increase from the same month last year. This jump in sales is most likely due to lower prices and interest rates. Indeed, the average price of the standard single-family home was down more than 5 per cent from July 2008. However, the average of $711,702 last month is a 10 per cent increase from the beginning of this year. Similarly, the Fraser Valley recorded 2,089 sales this July which marks a 62 per cent rise from one year ago. Most interestingly, the previous record for July sales in the Fraser Valley was set in 2005 when 2,051 sales were recorded.
The story continues in the same vein as the price of an average Fraser Valley detached home was down from last year but making improvement compared to 3 months ago. In fact, while the average price of $477,420 dipped nearly 6 per cent from last year there has been about a 4 per cent rise in prices compared to April 2008. First time buyers appear to be the culprit behind these sales boosts. Moreover, as sellers part with their homes they also enter the market, usually taking a step up on the property ladder. The case seems to be that the first time buyers from a couple of years ago are now selling to today's first time buyers and are thereby on the market for new homes as well. Assisted by low mortgage rates, home owners feel comfortable taking the step to pricier homes.
Tales of trading up seem to be everywhere these days. Owners of one-bedroom condos are cashing in and moving on to two-bedroom units as the market continues to be flooded with first-time buyers. As the market has dipped slightly buyers are showing more interest which gives current home owners the option to move on to better properties and everybody shares in the savings.
With economic conditions still uncertain the recent strength of the real estate market has been surprising. In all likelihood, the market is beginning to stabilize again and the extra activity may be due to the perennial trend of increased sales during summer months. Still, the economic situation appears to be settling but this does not account for the rise in sales. In fact, long-term mortgage rates are already starting to rise which suggests that first time buyers may have a limited window of opportunity to cash in. Many real estate experts agree that it is difficult to foresee conditions that can support the current level of sales. While the market is not likely to crash again, increase mortgage rates and more economic confidence suggest that housing prices will raise again and sales will certainly taper.
The employment situation in BC is also showing signs of improvement. While the availability of full-time jobs dropped recently there has been a stabilizing trend as of late. With the introduction of more jobs home buyers will be more confident about their ability to make a long-term commitment to a home. Whether or not the current sales trends are sustainable is yet to be seen. Some areas are seeing a move to a seller's market as inventories are not as robust as they once were. In fact, the number of listings in Vancouver has dropped 34 per cent over the past year and similar drops have been noticed throughout the Fraser Valley and Lower Mainland.
The real estate picture is still somewhat unclear. There are several economic factors still in question and increased sales may be the result of a temporary summer boon. However, for the most part experts are optimistic about the future of real estate in BC.
Statistics show that realtors in the Lower Mainland inked 4,114 sales in July of 2009 which is nearly a 90 per cent increase from the same month last year. This jump in sales is most likely due to lower prices and interest rates. Indeed, the average price of the standard single-family home was down more than 5 per cent from July 2008. However, the average of $711,702 last month is a 10 per cent increase from the beginning of this year. Similarly, the Fraser Valley recorded 2,089 sales this July which marks a 62 per cent rise from one year ago. Most interestingly, the previous record for July sales in the Fraser Valley was set in 2005 when 2,051 sales were recorded.
The story continues in the same vein as the price of an average Fraser Valley detached home was down from last year but making improvement compared to 3 months ago. In fact, while the average price of $477,420 dipped nearly 6 per cent from last year there has been about a 4 per cent rise in prices compared to April 2008. First time buyers appear to be the culprit behind these sales boosts. Moreover, as sellers part with their homes they also enter the market, usually taking a step up on the property ladder. The case seems to be that the first time buyers from a couple of years ago are now selling to today's first time buyers and are thereby on the market for new homes as well. Assisted by low mortgage rates, home owners feel comfortable taking the step to pricier homes.
Tales of trading up seem to be everywhere these days. Owners of one-bedroom condos are cashing in and moving on to two-bedroom units as the market continues to be flooded with first-time buyers. As the market has dipped slightly buyers are showing more interest which gives current home owners the option to move on to better properties and everybody shares in the savings.
With economic conditions still uncertain the recent strength of the real estate market has been surprising. In all likelihood, the market is beginning to stabilize again and the extra activity may be due to the perennial trend of increased sales during summer months. Still, the economic situation appears to be settling but this does not account for the rise in sales. In fact, long-term mortgage rates are already starting to rise which suggests that first time buyers may have a limited window of opportunity to cash in. Many real estate experts agree that it is difficult to foresee conditions that can support the current level of sales. While the market is not likely to crash again, increase mortgage rates and more economic confidence suggest that housing prices will raise again and sales will certainly taper.
The employment situation in BC is also showing signs of improvement. While the availability of full-time jobs dropped recently there has been a stabilizing trend as of late. With the introduction of more jobs home buyers will be more confident about their ability to make a long-term commitment to a home. Whether or not the current sales trends are sustainable is yet to be seen. Some areas are seeing a move to a seller's market as inventories are not as robust as they once were. In fact, the number of listings in Vancouver has dropped 34 per cent over the past year and similar drops have been noticed throughout the Fraser Valley and Lower Mainland.
The real estate picture is still somewhat unclear. There are several economic factors still in question and increased sales may be the result of a temporary summer boon. However, for the most part experts are optimistic about the future of real estate in BC.
posted by VancouverResidence
