Vancouver 125 by Summer Live
Same old! Same old! Market is steady, prices are increasing incrementally in some Metro areas and noticeably in others.
There was more activity than usual in August despite the fine weather. It seems to have encouraged buyers to get out and about and make housing decisions.
There is subliminal pressure on both buyers and sellers to take advantage of the continuing low mortgage rates. There is little talk at the Bank of Canada or the Fed in the US about raising rates before the employment numbers go up but the openendedness of the process means the rates could change overnight and this run has gone on for a long time.
World events this summer have been driving investors into North American stocks and bonds and Vancouver real estate.
There has been lots of anecdotal evidence of who the buyers are and where they came from but few statistics. There is no restriction on foreign ownership of real estate in Canada and the Federal government does not collect exit information on who is leaving the country. This means that no one knows if buyers are immigrants or investors who may leave the property to stand empty for years. This has been a fear in neighbourhoods where the City Plan would build townhouse developments and is a reality in many downtown high end condo buildings.
Macdonald Realty Ltd., a large BC independent firm with extensive Chinese relationships, took a step forward in the process of trying to identify who is buying detached homes in Vancouver. In a recent report the company stated that 33.5% of the 531 single family homes it sold in the City of Vancouver in 2013 were purchased by buyers who were a mix of recent immigrants and Canadian citizens with Mainland Chinese connections. They chose properties at the high end of the market with sale prices above $2 million. The report also stated that there didn't appear to be many true investors buying Vancouver real estate. There may be fewer in the future due to the corruption probe of the wealthy establishment being conducted by President Xi Jinping of the Peoples Republic of China.
As you can see from our four-year comparison in our infographics, the market development has been pretty similar in Vancouver and Richmond, BC. We can see a steady rise in sales of all housing types in comparison to August 2013. The only exception are the slightly lower sales of detached homes in Richmond. This is no surprise considering the prices of Richmond's detached properties have seen a much higher rise in prices in recent years than townhouses or apartment properties in the same area. The statistics show that in the last 5 years, the prices of detached properties in Richmond rose by 38.1%, which is considerably more than the 5 year rise in townhouse prices (20%) or attached property prices (5.8%).