What’s happening in the Real Estate market?
By far, as a Realtor the question I get asked the most is, “what’s happening in the real estate market?” and then the next thing people want to know, especially during these uncertain times is, “what is going to happen in the real estate market next several months?”
The COVID-19 Factor
As you can imagine, it’s difficult to predict what is going to happen and opinions among real estate professionals vary right now almost week to week! A big reason is we just don’t know what’s going to happen with COVID-19. Is there going to be another wave? Are businesses going to be able to stay open and recover? What will the impact of the current protests, social unrest, and the November US election be? As you can see, there are a lot of unknowns right now.
In the midst of all this, the CMHC came out with quite a “dire prediction”* saying that housing prices will drop in BC. CMHC CEO Evan Siddall “told a parliamentary committee that Canadian house prices could drop by as much as 18%.”*
He also said that “20% of mortgage holders who are deferring payments could be in arrears at the end of September when the COVID-19 deferral period finishes if the economy doesn’t improve.”*
Adding insult to injury for those of us who live in Vancouver he mentioned that Vancouver along with Toronto and Alberta could be the hardest-hit places.
A bit of optimism
More optimistically there is still a demand for housing in Metro Vancouver and real estate is selling. There has been a healthy increase in listings and sales so far in June and we may be on pace to have more listings and sales than we did in June 2019. In June 2019 there were 913 listings and 397 sales and as of June 9, 2020, there are 863 listings and 380 sales. In all of May 2020, there were only 522 listings and 180 sales. This increase in June over May 2020 is probably due to pent up demand that occurred as a result of the shutdown, so it will be interesting to see what happens during the summer.
It’s going to be an unusual summer because of the continued restriction on travel. Immigration in Metro Vancouver is a driving factor in our housing market, but with the travel restrictions, immigration is reduced dramatically. If restrictions are lifted immigration can return, pushing the real estate market to pick up again.
On top of immigration and travel, people won’t be going away as much this summer which usually causes a bit of a seasonal lull in real estate sales. I’m curious to see what the impact will be on the housing market this summer with more people having to stay home rather than leave on vacation.
Mike’s current advice
My current advice is if you are a homeowner and you are needing or wanting to sell, this may be an opportune time to discuss your options with your real estate professional.
I want my clients to know, as challenging as it might be sometimes, that I am always open to discuss what is occurring in the housing market. If you have any questions about your property, please don’t hesitate to contact me.
Please take good care,
*Vancouver Sun https://vancouversun.com/news/local-news/cmhc-offers-dire-predictions-for-house-price-drops-in-b-c?utm_medium=Social&utm_source=Facebook#Echobox=1590622621