Maria Mak- Burnaby Realtor - Home buyer demand outpacing supply across the Metro Vancouver housing market

Strong home buyer demand coupled with below average home listing activity has created seller's market conditions within the Metro Vancouver* housing market.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in Metro Vancouver reached 4,179 on the Multiple Listing Service® (MLS®) in April 2015. This represents a 37 per cent increase compared to the 3,050 sales recorded in April 2014, and a 2.9 per cent increase compared to the 4,060 sales in March 2015.

Last month’s sales were 29.3 per cent above the 10-year sales average for the month.

“The supply of homes for sale today in the region is not meeting the demand we're seeing from home buyers. This is putting upward pressure on prices, particularly in the detached home market," Darcy McLeod, REBGV president said.

New listings for detached, attached and apartment properties in Metro Vancouver totalled 5,897 in April. This represents a 0.9 per cent decrease compared to the 5,950 new listings reported in April 2014.

The total number of properties currently listed for sale on the region’s MLS® is 12,436, a 19.8 per cent decline compared to April 2014 and an increase of 0.5 per cent compared to March 2015.

“It’s a competitive and fast-moving market today that is tilted in favour of home sellers. To be competitive, it’s important to connect with a local REALTOR® who can help you develop a strategy to meet your home buying or selling needs,” McLeod said. 

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $673,000. This represents an 8.5 per cent increase compared to April 2014.

The sales-to-active-listings ratio in April was 33.6 per cent. This is the highest that this ratio has been in Metro Vancouver since June 2007.

Sales of detached properties in April 2015 reached 1,815, an increase of 35.9 per cent from the 1,336 detached sales recorded in April 2014, and a 70.6 per cent increase from the 1,064 units sold in April 2013. The benchmark price for a detached property in Metro Vancouver increased 12.5 per cent from April 2014 to $1,078,900.

Sales of apartment properties reached 1,579 in April 2015, an increase of 34.7 per cent compared to the 1,172 sales in April 2014, and an increase of 50.1 per cent compared to the 1,052 sales in April 2013. The benchmark price of an apartment property increased 4.4 per cent from April 2014 to $394,200.

Attached property sales in April 2015 totalled 785, an increase of 44.8 per cent compared to the 542 sales in April 2014, and a 53.6 per cent increase from the 511 attached properties sold in April 2013. The benchmark price of an attached unit increased 5.7 per cent between April 2014 and 2015 to $493,300.

*Note: Areas covered by Real Estate Board of Greater Vancouver include: Whistler, Sunshine Coast, Squamish, West Vancouver, North Vancouver, Vancouver, Burnaby, New Westminster, Richmond, Port Moody, Port Coquitlam, Coquitlam, New Westminster, Pitt Meadows, Maple Ridge, and South Delta.

For all your premium real estate services, please visit www.mariamak.com or contact Maria and her team @ 604-839-6368.

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Maria Mak. Burnaby Realtor - Happy Chinese New Year !

新年快乐-祝您身体健康和繁荣新的一年.

Maria Mak- Burnaby Realtor - Season's Greetings

Merry Christmas and Happy New Year!

Maria Mak - Burnaby Real Estate Agents - Mortgage rates slightly higher in 2015

    

      

Highlights Mortgage rates modestly higher in 2015 Robust growth in the Canadian economy tested by falling oil prices Bank of Canada likely on hold until late 2015

Mortgage rate outlook 

Long-term interest rates have remained near their lowest levels of the year for most the second half of 2014, even in the face of an improved outlook for economic growth and higher inflation. The five-year Government of Canada bond yield, the benchmark for the five-year mortgage-qualifying rate, has trended at or below 1.5 per cent for much of the year. Indeed, for the past several years interest rates have frustrated forecasters predicting an imminent normalization.
Persistently low long-term bond yields can be partially explained by factors such as an aging population and associated slowing of potential economic growth as well as increased demand by foreign investors for safe Canadian assets. Ultimately, what may be keeping long-term bond yields and mortgages rates near historic lows is a lack of confidence in the sustainability of economic recovery. If so, an important catalyst for an eventual normalization of interest rates is some signal to markets that the US economy has finally healed. The best candidate for such a signal is the US Federal Reserve tightening monetary policy following six years holding the federal funds rate at zero.

Most forecasters have penciled in a Fed rate hike in the spring of 2015, with the Bank of Canada following later in the fall. However, there may be ample reasons for the Fed to stay on hold in 2015. First, US economic growth forecasts have been notoriously optimistic since the end of the Global Financial Crisis. Indeed, while the US economy is currently posting its strongest growth in years, global economic growth seems to be deteriorating as Europe struggles and China slows. Any disruption in global financial markets stemming from those economies would likely delay a move by the Fed. Moreover, inflation in the United States is already running well below the Fed’s target of 2 per cent and should track lower due to falling energy prices.
That said, our baseline forecast remains tilted toward a probable rate increase by both the Fed and the Bank of Canada in 2015. Long-term interest rates will likely move modestly higher beginning in early to mid-2015 in anticipation of monetary tightening, which should put some upward pressure on mortgage rates. We expect that the five-year fixed rate will average 5.15 per cent in 2015 and the one-year rate will average 3.29 per cent.

Economic outlook

The Canadian economy was hammered by severe winter weather to start the year but has since posted average quarterly growth of over 3 per cent. Indeed, the outlook for growth in the Canadian economy is as bright as it has been in years. That said, the recent dramatic downturn in oil prices will very likely trim growth in coming quarters.

While lower prices for gas and other energy goods may be seen as positive, untangling the macroeconomic consequences of declining oil prices can be complex for an oil-producing country like Canada. The Canadian dollar is implicitly tethered to the price of oil, and has trended lower alongside oil prices. That decline will act as a shock absorber, boosting Canadian export competiveness. On the downside, dramatically lower oil prices will be felt immediately though Canada’s terms of trade as the value of Canadian exports is dragged lower by energy goods.
If low oil prices persist, investment, output and employment in the Canadian oil and gas sector could be in jeopardy as well. Fortunately, other parts of the Canadian economy continue to prosper. In particular, momentum in business investment and non-energy exports has been growing and should provide a decent handoff to 2015. Overall, we anticipate that the Canadian economy will match 2014’s estimated growth of 2.4 per cent next year before decelerating slightly to 2.3 per cent in 2016.

Interest rate outlook

In its most recent interest rate decision, the Bank of Canada emphasized that the Canadian economy is as healthy as it has been in many years. Faster than expected economic growth in 2014 has helped close much of the Canadian output gap, and the economy is on track to return to its full employment level faster than previously expected.
With inflation trending above 2 per cent and the economy accelerating, we would normally expect to see some tightening of interest rates from the Bank of Canada. However, the Bank remains reticent. One reason is that although the Canadian unemployment rate has fallen to its lowest level in six years, both total hours worked and average wages have not registered the type of gains we would normally see in a thriving economy. Indeed, the Bank of Canada cited excess slack in labour markets as the key offset to an otherwise very healthy economy.

Additionally, the steep decline in the price of oil, if sustained, will be a significant headwind for both growth and inflation next year. Our model simulations show that a sustained drop in the price of oil will delay the closing of the Canadian output gap by several months. Given these factors, if the Bank does decide to raise its overnight rate in 2015, we expect that it would not occur until the later part of 2015.

Copyright British Columbia Real Estate Association. Reprinted with permission.

 

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