Perfect Market for 3 groups of Buyers
I believe the audience must have heard of the real estate report from the real estate board on the media. You can read the whole report at http://www.tinamak.com/VancouverArchives.ubr. Yes, our housing prices have dropped but only by an average of 2.3% for the detached properties, 1% down from the attached property and 2% down from apartment. Sales volume has definitely dropped quite a bit. However, this is absolutely normal when the real estate speculators are out of the market. Moreoever, if you compare to the great run we had in the last 7 years with so many properties doubled their price, we shouldn't take this type of small dip as a shock. When everybody worries and complains about our unaffordable housing market, we should welcome this sign of levelling in the market to allow tenants or young working adults to have an opportunity to own their real estate. Historically, I haven't seen a combination of slow market, high inventory and low interest rates. How long do you think this will last? Some expect the interest rate is going to be higher later on the year or next year. Even if house prices drop more, how much saving will you make if the interest rates goes up by 1% to 2%? In my opinion, this market is perfect for 3 types of buyers:
1) real buyers who needs a home. Rental rate isn't getting any cheaper, in fact, it is much higher than a few years ago. Why would you keep renting, putting money into the drain instead of putting in the principle of your mortgage? Let real estate make money for you instead of hoping for a wage increase. Even when you get a wage increase, it is not going to be, like our politicians who get, 30%-40% hike!
2) long term investors who understand the investment rules and see the opportunity in market like this to buy some real asset instead of playing the yo-yo stock market. Be the "President" of your own property instead of being the one in a million shareholder of stocks. However, real estate doesn't give you the daily excitment like the stock market does, I'd prefer to have a healthy heart beat instead of having a heart attack!
3) and finally for those who would like to upgrade. A slow or if you believe a downturn market financially works actually way better for this type of home owners. For eg., no matter you want to upgrade the size of your home or the location of your home. Since you are buying up, should the market drop 10%, the amount of the higher price property is going to be more than your lower priced property. Therefore, you are definitely ahead of the game when moving up. When the market is going down it's good to buy up. Those home owner's I might recommend to hold off from selling, are those who would like to down size.