watch: Housing Market Update (July 2017)

BC Real Estate Association (BCREA) Economist Brendon Ogmundson discusses the June 2017 statistics.

"Again, thank you, is all I can say here! Above and beyond!! Thanks, Nic! I have really appreciated working with you these past couple of years. You certainly went above and beyond for me, and I haven’t forgotten it. "~ L.Batchelor, Seattle, WA, USA

Bank of Canada Interest Rate Decision

The Bank of Canada announced this morning that it is raising its target for the overnight rate by 25 basis points to 0.75 per cent. In the press release accompanying the decision, the Bank noted that Canada’s economy has been robust and a significant amount of economic slack has been absorbed. While inflation data has been soft, the Bank expects that this is temporary and that inflation will return to its 2 per cent target by mid-2018.

The motivation for today’s rate increase seems primarily to be that the Bank feels that the stimulus it injected into the Canadian economy in 2015 through two rate cuts is no longer required given a recent trend of strong economic and employment growth. If that is the case, a further 25 basis point increase before the end of the year will likely follow.  After that, the pace of rate increases relies heavily on the trend in Canadian inflation, which to date has been well below the Bank’s 2 per cent target. If that trend does not reverse by early next year, the Bank may decide to stop at a 1 per cent overnight rate until higher inflation emerges.

As bond markets reprice rate expectations, Canadian mortgage rates have returned to levels observed at the beginning of the year. We expect that mortgage rates will rise further in the second half of 2017, finishing near 3 per cent for a five-year fixed rate.

For more information, please contact: 

Cameron Muir Brendon Ogmundson
Chief Economist Economist
Direct: 604.742.2780 Direct: 604.742.2796
Mobile: 778.229.1884 Mobile: 604.505.6793
Email: cmuir@bcrea.bc.ca Email: bogmundson@bcrea.bc.ca

 



"

I have worked with Nick and His staff since 2005 and found him and his staff to be the BEST Property managers in Vancouver… My downtown clients swear by him as well…. Reliable, Dependable 1st Class

. " ~ Ray Harris Re/max Sabre Realty
, PAST Board Chair and President at Real Estate Board of Greater Vancouver

June 2017 Market Update Video – REBGV

REBGV President Jill Oudil highlights the four key indicators of the June housing market and looks at the two distinct markets that have emerged this summer.

"Again, thank you, is all I can say here! Above and beyond!! Thanks, Nic! I have really appreciated working with you these past couple of years. You certainly went above and beyond for me, and I haven’t forgotten it. "~ L.Batchelor, Seattle, WA, USA

Mortgage Rate Forecast – BCREA

 

Highlights:

• Hawkish turn at the Bank of Canada?
• Canadian economy heating up
• Falling oil prices and low inflation may keep Bank on hold until 2018

CLICK HERE to read the full report



"

I have worked with Nick and His staff since 2005 and found him and his staff to be the BEST Property managers in Vancouver… My downtown clients swear by him as well…. Reliable, Dependable 1st Class

. " ~ Ray Harris Re/max Sabre Realty
, PAST Board Chair and President at Real Estate Board of Greater Vancouver

May 2017 Housing Market Update – BCREA


 

 

watch:  BCREA Chief Economist Cameron Muir discuss the May 2017 statistics



"I’ve known and worked with Nicholas for the past 20 years. When it comes to rental suites, nobody knows the market better than him. You will always be satisfied utilizing not only his services but his knowledge is incredible.
" ~Vic Jang, 
President at Sutton West Coast Realty Ltd

Housing Supply Not Keeping Pace with Demand in Most BC Regions

The British Columbia Real Estate Association (BCREA) reports that a total of 12,402 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in May, down 7.9 per cent from the same period last year. Total sales dollar volume was $9.33 billion, down 4.0 per cent from May 2017. The average MLS® residential price in the province was $752,536, a 4.2 per cent increase from the same period last year.

“Market conditions have tightened considerably this spring as an upturn in consumer demand has not been accompanied by a rise in homes listed for sale,” said Cameron Muir, BCREA Chief Economist. “The supply of homes for sale in the province has fallen 50 per cent over the past five years.”

“The entire southern portion of the province is experiencing a shortage of housing supply, which makes continuing upward pressure on home prices inevitable, at least in the near term,” added Muir. Total active listings in the province were down 11.1 per cent to 28,404 units from May 2016. The ratio of home sales to active listings was well over 20 per cent in nine of the province’s 11 real estate boards, and over 50 per cent in Vancouver, the Fraser Valley, Chilliwack and Victoria.

Year-to-date, BC residential sales dollar volume was down 25.2 per cent to $30.6 billion, when compared with the same period in 2016. Residential unit sales declined 20.1 per cent to 43,158 units, while the average MLS® residential price was down 5.7 per cent to $709,541.

For the complete news release, including detailed statistics, click here.

" Thank you for being my realtor in purchasing my Vancouver properties, managing my suites and providing guidance regarding real estate and rental property investing. If I purchase another Vancouver property I will contact you first."~ A. Louangxay, Edmonton, AB

Video: May 2017 Housing Market Update – REBGV

REBGV President Jill Oudil gives an overview of the May housing market and looks at the year-over-year differences in our market.

 



"Nicholas has been my client for over 20 years, as his financial planner and it has been a pleasure working with him over the years. I have found Nicholas to be very extremely knowledgeable ethical, dependable diligent and client focused. He is extremely honest in giving his opinion, even if it means walking away from closing a sale. I have learnt a lot of things in Real Estate from him. We also have mutual clients,and have heard nothing but praises from these clients of the service he has and continues to provide to them. Ihave also recommended clients to Nicholas, since I wanted them to be looked after by the BEST”~ Pat Majumdar,
 Mortgage Specialist

May 2017 REBGV Stats

Home buyer activity returned to near record levels across the Metro Vancouver housing market in May.

Residential property sales in the region totalled 4,364 in May 2017, a decrease of 8.5 per cent from the 4,769 sales in May 2016, an all-time record, and an increase of 22.8 per cent compared to April 2017 when 3,553 homes sold.

Last month’s sales were 23.7 per cent above the 10-year May sales average and is the third-highest selling May on record.

“Demand for condominiums and townhomes is driving today’s activity,” Jill Oudil, Real Estate Board of Greater Vancouver (REBGV) president said. “First-time buyers and people looking to downsize from their single-family homes are both competing for these two types of housing.”

New listings for detached, attached and apartment properties in Metro Vancouver totalled 6,044 in May 2017. This represents a 3.9 per cent decrease compared to the 6,289 units listed in May 2016 and a 23.2 per cent increase compared to April 2017 when 4,907 homes were listed.

The month-over-month increase in new listings was led by detached homes at 27.1 per cent, followed by apartments at 22.7 per cent and townhomes at 14.1 per cent.

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 8,168, a 5.7 per cent increase compared to May 2016 (7,726) and a 4.5 per cent increase compared to April 2017 (7,813).

“Home buyers are beginning to have more selection to choose from in the detached market, but the number of condominiums for sale continues to decline,” Oudil said.

The sales-to-active listings ratio across all residential categories is 53.4 per cent. By property type, the ratio is 31 per cent for detached homes, 76.1 per cent for townhomes, and 94.6 per cent for condominiums.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“While sales are inching closer to the record-breaking pace of 2016, the market itself looks different. Sales last year were driven by demand for single-family homes. This year, it’s clear that townhomes and condominiums are leading the way,” said Oudil. “It’s important to work with your local REALTOR® to understand the different factors affecting the market today.”

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $967,500. This represents an 8.8 per cent increase over May 2016 and a 2.8 per cent increase compared to April 2017.

Sales of detached properties in May 2017 reached 1,548, a decrease of 17 per cent from the 1,865 detached sales recorded in May 2016. The benchmark price for a detached property is $1,561,000. This represents a 3.1 per cent increase over May 2016 and a 2.9 per cent increase compared to April 2017.

Sales of apartment properties reached 2,025 in May 2017, a decrease of 5.8 per cent compared to the 2,150 sales in May 2016.The benchmark price for an apartment property is $571,300. This represents a 17.8 per cent increase over May 2016 and a 3.1 per cent increase compared to April 2017.

Attached property sales in May 2017 totalled 791, an increase of 4.9 per cent compared to the 754 sales in May 2016. The benchmark price for an attached property is $715,400. This represents a 13.1 per cent increase over May 2016 and a 1.9 per cent increase compared to April 2017.


Download the full May 2017 stats package here
.

"You certainly went above and beyond for me, and I haven’t forgotten it."~ L.B., Seattle, WA

Interest rates held as BoC weighs risks – REP

The Bank of Canada held interest rates at 0.5 per cent Wednesday with an assessment of the economy which has some positives tempered with risks.

Governor Stephen Poloz said that while the economy is adjusting to lower oil prices and inflation is broadly in line with expectation, it expects growth in the second quarter to moderate from the first.

The bank is still closely watching high levels of household debt and rising house prices but noted that consumer spending and debt levels are robust and that is spreading broadly across regions.

Macroprudential and other policy measures, while contributing to more sustainable debt profiles, have yet to have a substantial cooling effect on housing markets, the bank said.

In its assessment of the BoC’s announcement, the Conference Board of Canada highlighted the ongoing risk of protectionism and the imbalances in real estate values and rising household debt.

“The subdued pace of inflation and uncertainties stemming from global and domestic risks has the Bank of Canada in wait-and-see mode. The next move in interest rates is likely upwards, but this may not come until early next year.
By then, there will be a greater understanding of how the risks may play out,” said Craig Alexander, Senior Vice-President and Chief Economist, The Conference Board of Canada.



"

I have been using Nicholas’ services since 1988, first as a realtor and later as a rental suite manager. I have also recommended his services to numerous friends and clients who thanked me for referring him. The words they all used were “knowledge” and “integrity”. Nicholas is one of the rare members of this profession who prefers long-term client relationship to quickly collecting a commission. This was the case when he discouraged me from purchasing properties he knew were not right for me, even though this meant additional work for him. And did I mention that he is also well educated and great company"~ Zuzana Kulhánková
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