January 2016 Market Update
January Market Update
2015 was a record year in real estate in Greater Vancouver. Sale prices and sales volumes rose throughout the year, with overall sales totalling 42,326, a 27.8% increase over 2014. We experienced a very strong seller’s market that got stronger as the year progressed.
Many areas of Vancouver showed sales figures that far exceeded the average. For example, in December in Dunbar 88 out of 100 houses listed were sold (an 88% sales ratio); Kitsilano outperformed that, with a 100% sales ratio for its few detached properties and 73% for the many condos and townhouses in that area.
On the East side, the December sales ratios were remarkable, with some areas seeing 100% or higher for houses (Fraser, Grandview, Hastings East, Knight, Main and Mount Pleasant). For attached properties, several areas were also at or above the 100% mark.
So What Does 2016 Hold?
As some of you have heard us say, we try not to forecast anymore, since Vancouver real estate continues to defy expectations in one way or another. Nonetheless, let’s look at some of the factors that may affect the market this coming year.
The dramatic fall of the loonie may encourage people not only from Asia, but also from the US and other countries, to invest in Vancouver real estate. A client told me the other day of a busy open house she went to at a downtown condo, and noted that several of the interested parties were American.
Interest rates remain generally stable and still at historic lows, so that is not likely to be a major factor in any market changes this year. Moreover, since many high value investors don’t need or want a mortgage, rates are irrelevant to them.
One upcoming change may affect the lower end of the market. Currently, the minimum down payment for properties under $1M is 5%. After February 15, the minimum down payment for the portion of a property’s value above $500,000 will increase to 10%. So if you purchase a property for $575,000, your minimum down payment will need to be 5% on the first $500,000 and 10% on the last $75,000. Note that for down payments of less than 20%, you will need to pay a higher mortgage rate to insure your mortgage against default.
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SEMINAR THIS WEEK!
We are holding a seminar this Thursday, January 28, from 7 - 9 p.m. at West Point Grey Community Centre on buying and selling your home (this covers houses and condos). We still have some spaces left, so if you would like to attend, drop me a line and we'll add you in.