The continuous chatter about the real estate market paints a picture that many describe as being less than optimistic, to say at least. That’s a generalization that is misleading.
Yes, the market is shifting because of all the factors that are now well-known — bumps in interest rates, world-wide economy changes, uncertainty in Ukraine, low inventory of homes for sale, rising costs for just about everything. There is another side to the picture. People are still moving, for the usual variety of reasons, and that means real estate activity. They could be right-sizing: moving from a larger home to a condo. Or moving here from another country or another province — immigration is growing, not slowing. All of that contributes to real-estate activity.
There are still going to be first-time home buyers because, even though high home prices and increasing interest rates may make it a little more difficult, they will find a way if they can. Some are perhaps pre-approved for mortgages at lower rates, and just waiting to jump into the market. Some have locked-in mortgages that can move with them.
Interest rates represent just one of the factors in the market, affecting some buyers but not others. The couple selling a $4.2-million house that has been home for decades to move into a 1,600-square-foot condo at half the price, or less, are not likely to be affected by interest rates, a strategy that’s designed to curtail inflation, although the jury of experts still seems to be out on that.
And as long as there is a shortage of housing, that will put upward pressure on home prices. In the federal budget, the government unveiled plans to double the construction of new homes and the impact of that will take time. It has only been three months.
So some prices will go up, and some will fall. Some markets will be active, and some will be soft. Some homes will sell quickly, and some will not. It’s impossible to know if the “big market” has peaked, or if it hasn’t. Every indicator is accompanied by uncertainty. Making market assumptions can also be misleading, especially in a season that traditionally experiences a summer slowdown.
One global economic analyst last month looked at the housing market with a perspective that is interesting.
Financial Times Global Business Columnist Rana Foroohar works for CNN, and while her take was U.S.-focussed it can probably be applied north of the border: works for CNN, and while her take was U.S. focussed it can probably be applied north of the border:
“Two things are happening in the housing market, one real, one financial. Certainly low rates, and some of that monetary stimulus, helped. Low rates encourage buying. You’re trying to push people into the market, but that’s only about a third of what’s going on.
“If you look at mortgage rates, we’re not back in 2008. You’re not seeing a ton of bad lending going on. The pandemic was an incredible shift in the American housing market. You suddenly could work two or three hours away from the cities that you might have lived in. A lot of people moved from expensive coastal cities to the south and to the west. In some ways that’s a real structural shift that’s still playing out.
“It might be more like the adoption of the automobile in the post World War Two period, which allowed people to travel in new ways. It created the suburbs. It pushed people out to California. I think some of those shifts are going to last another year, two years, maybe five years. And so you won’t see the sort of collapse in the housing market the way you might see in the asset markets except in very very frothy areas."
The words “stability” and “patience” have generally been missing from assessments of where the current real estate market resides, but both are creeping back into the conversation.
Stability means the market becomes more predictable. Patience means buyers can avoid rushing into a purchase because others are lining up to make offers.
The measuring stick most associated with stability is the sales-to-active-listings ratio, which in the current statistics released by the Real Estate Board of Greater Vancouver are…settling down. When the ratio is between 12 per cent and 20 percent, that’s considered balanced market territory. Lower than 12 per cent means downward pressure on home prices. More than 20 is the reverse — upward pressure — but in either case the percentages have to remain in that neighbourhood for a “sustained period.”
The ratio for June was 23.1 per cent.
That’s more in line than where the market has been, which is higher ratios that exert pressure on higher home prices. That’s also combining all property types. By category, the sales-to-active-listings ratio is 14.3 per cent for detached homes, 31.5 per cent for attached (townhouses), and 30.2 per cent for apartments/condos.
That indicates townhouses and apartments are selling better than detached homes at this time.
With this drifting market, buyers are usually able to exert more patience before making offers. In its news release, the REBGV said: “Home buyers have more selection to choose from and more time to make decisions than they did over the past year. Rising interest rates and inflationary concerns are making buyers more cautious in today’s housing market, which is allowing listings to accumulate.”
As a result, the number of listings is, slowly and sporadically, increasing as the volume of sales is decreasing — down 16.2 per cent from May. Sales are 23.3 per cent below the 10-year June average. Keep in mind, however, that these generalized statistical analyses are for Greater Vancouver and do not necessarily apply to the many mini and micro markets. In the four markets most closely tracked by Nexus Realty (West Vancouver, North Vancouver, Vancouver West and Vancouver East), there were no dramatic changes from the May 2022 sales and listings statistics and the ones just released for June.
That, too, contributes to stability.
Eco-friendly homes are showing signs of becoming unique alternatives and perhaps eventually the future of housing in Canada, according to a report on CTV News. One expert believes net-zero living will become the go-to standard for new construction. Six builders across the country are involved. Eco-friendly homes are built with materials non-toxic to the environment, with features to offset greenhouse gas emissions.
Buildings from the popular TV show Schitt’s Creek are still available. The 24,000-square foot mansion, with 14 bedrooms and 16 bathrooms, has been listed 10 times since it last sold as a bungalow in 2008. Current asking price is $17.78 million. And the Rose Apothecary Store — also in Southern Ontario — can be had, with its three bedrooms and three bathrooms, for $2.35 million.
Changes to construction bylaws in Vancouver will require cooling and air filtration in all new large buildings. According to a Vancouver Sun story, new-builds will require cooling systems by 2025 and air filtration to protect residents from heat waves and smoke pollution. The bylaws, approved last month, are said to reduce carbon emissions by the equivalent of removing 13,000 gasoline-powered cars.
A long-time resident of West Vancouver, Joan Gouws decided it was time she moved closer to her family, her son on Vancouver Island. Selling her home was a process she hadn't experienced in many years when she enlisted Nexus Realty to be her guide.
After the sale was completed last month, here's what she had to say about her experience:
"The market was pretty good when I decided to put it on the market, so we put it on for a million, and we had an offer fairly quickly. We countered and it was accepted.
"There was nothing complicated — my son lives in Victoria — because Dale and Jennifer included him on everything. As soon as they spoke to me, they spoke to Mark. They were very good about following up with Mark. I wasn’t surprised at how helpful they were, but I really enjoyed that they were, with every detail, right to the end! They followed up on EVERY detail, and they always took the time to discuss everything with Mark as well. When they emailed with information. it was to both of us. Mark was so happy with the way it all went. He definitely felt comfortable with it all. I can’t say enough about how easy they made it. "I don’t think it really mattered that the market was strong, you know, because we had already decided to do this. It just so happened. It didn’t take as long as I thought to sell. Once we called and told Dale we were ready to put it on the market, he and Jennifer got going right away in preparation. I liked the place so much, but it was time to sell it. I’d been there since 2006, so there are lots of memories.
"I was not at all surprised how efficient they were. Jennifer showed me printouts and papers and legal documents. They were just there all the time. They’re very friendly, and you never feel as though you’re waiting to hear from them. They were on the phone right away. Nothing seems to be too much trouble. And I knew of their integrity, from the church. They definitely went the extra mile for me. Always. Every detail that cropped up, they were on top of it right away. They phoned right away and dealt with it right away. Nothing was lacking.
"As for negotiating, they did everything we wanted. They came to me for the approval and my signature. It was so very easy. I didn’t have to do anything. All I had to do when it was sold was make sure I got my storage locker emptied! That’s it! Fortunately, the condo was vacant, because I had already moved. All I had to do was take the swiffer to the dust bunnies once in a while!
You will have 61 opportunities to see a cruise ship arriving, or leaving, from Canada Place this month, Because this is so interesting for people who have or hope to have a view of Burrard Inlet from their homes, Nexus provides arrival and departure times for all of the visiting ships.
10th in a Series
Every month, News From Nexus features ideas or observations about Decor, or ways you can make your home more appealing.
Does anyone ever say: “This bathroom is too big?”
Rarely.
If there’s room in the budget, hiring a designer who specializes in bathrooms could ease the renovation stress. When it comes time for bathroom renos, there are countless ideas to give that small bathroom a larger-than-life feel.
Here’s a few of them:
1. White Light is Right
Particularly if natural light is scarce, or non-existent, keeping the base colour of a small bathroom white is the safest option. And remember, you can always use small accents of bold colour to make the room interesting.