Many sales in real estate have nothing to do with market conditions. Great examples of this are both of my daughters. Each wanted a detached home with some land in a small, family-oriented community and both reached their dreams of becoming homeowners late last year when they moved to the interior. Life doesn’t stop because the market slows down, and people need a place to live. Other cases when people need to buy a home include a new baby, divorce, need to downsize or find a home that can accommodate multiple generations. These are only some of the cases that the market is not part of the conversation.
Who is buying?
There are many incentives for first-time homebuyers by the provincial and federal government. It is also important to notice that interests have gone down, allowing more affordability for those seeking financing and undergoing the stress test.
This year the youngest baby boomers will be 55 years old, while the oldest will be 73 years old. As their children grow older and move out of their detached home, many of them want to move to a smaller, more affordable space. These moves may be related to health reasons, or they simply want the freedom to travel and enjoy their retirement.
Those relocating for work
British Columbia is still attracting talent from all over the country. A couple of months ago, I had the pleasure of helping a family relocating from Toronto. They needed to buy a new home as soon as possible so that their son could be enrolled in school.
Who isn’t buying?
Builders have pulled back on new home construction and, as a result, aren’t acquiring land or homes that need renovation. A main reason for this is that they still need to sell their completed inventory of new homes which are positioned mainly in the higher price points and have been hit by significant taxes such as the foreign buyers tax. This means that those detached homes in the $1.2 to $1.4 million that need some TLC aren’t as coveted as they were just a couple of years ago.
There are buyers who are trying to time the bottom of the market. Keep in mind that we never really know once we have reached the top or bottom of the market until we can look back and see where the statistical change happened. Some buyers plan to purchase once they see the prices begin to rise again slightly before jumping into the market. While no one wants to pay more than they have to, this strategy does not take into consideration the actual value of the home as a place to live but is focused on the asset itself. This is one reason why real estate in our area has begun to behave more like a stock rather than a place to raise a family.
Opportunities in presales and new developments
Developers are another group that is experiencing the downturn of the real estate market. As you have probably noticed, there are many new developments in different areas of the North Shore that should be completed in the next few months and years, and many of these developers are offering all kind of incentives to buyers. While this group might be tougher to negotiate with, many of them have established promos to encourage purchase.
Life doesn’t wait for the real estate market.
Don’t allow the market conditions to deter you from making the move that is right for you and your family. Remember I’m always available for a chat if you need some advice or have any questions. Contact me here.