January Sales Creep Up Compared to December, But Stress Test Impacts & Shifting Attitudes Towards Home Ownership Prove More Problematic in Our Market

By: Cheryl Davie

January Sales Creep Up Compared to December, But Stress Test Impacts & Shifting Attitudes Towards Home Ownership Prove More Problematic in Our Market

Tags: Homes in Vancouver, Vancouver Housing, Real Estate, January

January saw home listings continue to increase across all property categories, but buyer activity couldn’t keep up. Compared to December, home sales from this past month are up 2.9%, but overall, sales for January remain at their lowest point since 2009.

The New Mortgage "Stress Test" is Living Up to Its Name
 
According to the Real Estate Board of Vancouver, this new regulation, coupled with increased mortgage rates, is the key driver edging down home sales. It's harder than ever to borrow money, so properties with the highest value will suffer the most.

Though home values across all property types have come down, detached homes have seen the most dramatic decrease with benchmark prices down 8.3% over the past 6 months. In that same time frame, apartment prices have edged down 6.6% and attached homes have also decreased 6.2%.
 
*A "Sales to Active" ratio of 12% translates to: 12 out of every 100 homes are selling.

Attitudes Towards Home Ownership Are Also Experiencing
An "Edging Down"

There is a prominent feeling of “economic uncertainty” among Canadians, even if their personal finances are under control. RE/MAX recently conducted a survey of single Canadians and only 26% said they were seriously interested in buying a home. 43% of these same respondents also reported they had less than $5,000 in debt, so the questions remains, why the negative perception of home ownership from seemingly qualified buyers?
52% of Canadians labeled uncertain economic air, new layers of government intervention, and home prices that still seem overly inflated as their primary reasons for not purchasing a home.

These potential buyers are having a hard time investing their hard earned dollars because the value of property seems ambivalent. Many reported feeling pushed out of the market, and distrusting of it.
Key Findings from
RE/MAX Single Home Buyer's Survey

1. Canadian single buyers are more interested in purchasing single-detached homes (12%), than any other property type

2. Men are twice as likely as women to say that they are considering purchasing a home on their own (37% of Men vs. 17% of Women)

3. Single Canadians living in urban areas are more hesitant than single Canadians living in suburban areas to invest due to high home costs (48% vs. 43%)

For the full RE/MAX report on Single Home Buyers,
click here.


While this study only surveyed single potential homebuyers, in a study released by the National Association of Realtors, their findings indicated about 20% of all purchasers for 2018 were single women, and 9% were single men.

For the full highlights of the National Association of Realtors 2018 report,
click here.
 

"Buy Land - They're Not Making It Anymore"

The clearest takeaway from the recent survey? Buyers need restored faith in the housing market. But Mark Twain said it best - buy land, they’re not making it anymore. The ups and downs in real estate as of late have been substantial enough to distract many from the advantages of investing in property. Fluctuations in the market are cause for attention, but not alarm.

To learn more about how purchasing property could benefit your financial future, reach out for a referral to one of our trusted partners. Now is the time to ask questions and see how buying or selling in this market can work for you!