Let’s talk about the new September market statistics and what we can learn from them.
The market is much slower than usual at the moment. There are fewer sales across the board. About a 35% drop in over all transactions as compared to 10 year average. This is a fairly significant slow down.
Think about how much more real estate has been built over the last 10 years. Right now there are fewer sales even though the total number of real estate units is constantly increasing.
How significant this impact is depends on the type of real estate we look at and the price point.
For example detached houses have a sales to active listings ratio of about 12%. Meaning 12 out of every 100 houses available were sold in September. As far as apartments go the situation is a quite a bit different a sales to active listings ratio is about 21%. Which is almost double of that of the detached properties.
I think the evidence of this in my everyday work. 1 bedroom and studio units are still selling well. The demand and the prices did come down a bit but there is still a health amount of buyer activity for those starter homes. From personal experience I find the there aren’t as many speculative investors in the market right now. However buyers looking for a place to live are still active in this 1 bedroom and studio units category.
If you are looking to sell your 1 bedroom or a studio unit are likely to receive a healthy amount of interest.
The same can not be said for detached properties. Especially luxury market. From my experience the demand is not there and those properties take much longer to sell.
As far the prices are concern there is a drop. The board is reporting about a 2% price drop from August. I think that’s about in-line with my experience.
The primary cause of this market slow down and the price decrease are of course higher interest rates. Bank of Canada did once again raise their benchmark interest rate in September which definitely slows down the market.
Buyers aren’t able to borrow as much money as the stress test rate at the moment is ridiculously high. All of this creates quite a bit uncertainty for the future.
If you’re a seller my advice to be patient. And be realistic with your prices.
If you’re a buyer be ready. Have all of your down payment and pre-approval ready. Good opportunities to pop-up on the market. But they also disappear just as quickly. You want to put yourself in a position to take advantage of such opportunities.
I hope you will find this video helpful. Feel free to share this video with anyone who you think will find it useful.
If you’re in the market you might be interested in my monthly real estate newsletter. Here is a link: Real Estate Insider Newsletter
Thanks for reading.
Link to Real Estate Board of Great Vancouver statistics.