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The Ups And Downs of Vancouver Real Estate Market

Past Scenario

Housing in Vancouver was one of the biggest stories of 2016. A year ago, the Vancouver real estate market was described as a hot and sizzling market. The housing prices in Vancouver took a great leap and mushroomed over the year. These high rates were considered to be a boon for some and bane for others since after the evaluation, the cost of properties increased by double digits; in a few cases, the costs were raised by 40%.

In March 2016, the yearly homelessness count in Vancouver showed the highest number of people sleeping outside in ten years. Further, in June, the value of single detached houses and condos shot up by 40 and 25 percent respectively. The Finance Minister, Mike de Jong made an announcement of imposing 15 percent tax on foreign nationals. Along with this tax, the Vancouver city was also introduced to empty homes tax and new policies concerning the rental markets. The drastic increase in real estate prices affected the rental market as well.

The Present Situation

In the words of Dan Morrison, Real Estate Board of Greater Vancouver (REBGV) president, “It (2016) was an eventful year for real estate in Metro Vancouver. Escalating prices caused by low supply and strong home buyer demand brought more attention to the market than ever before.” Moreover, the Metro Vancouver real estate market experienced its third highest selling year on record in 2016, behind only 2015 and 2005.

Though, the recent updates have shown that the total number of houses vended in Greater Vancouver dropped more than 22 % in December in contrast with the preceding month. President Dan Morrison said that sales might have slowly risen, but the property costs have not dropped significantly.

According to the calculation, made by the real estate board, the benchmark price for apartments has escalated by 27 % from July 2015 to July 2016.  On the other hand, the price for townhomes has hiked by 29 percent, which is equal to the upper range from B.C. Assessment. Morrison said that it would take a little while for the market to familiarise with the changes that are taking place, and that the limited supply is the reason for a rise in the prices.

Future Forecast

According to Royal LePage, CEO Phil Soper and the latest predictions by real estate groups and financial institutions, the long-awaited corrections required in Vancouver’s inflamed housing market may be just around the corner. It has been forecasted that prices are headed for a double-digit decline in 2017 as the purchasers are dropping out of the housing market.

A report released last month by the B.C. Real Estate Association anticipated an 8.7% fall in housing costs in the area for 2017 with the average MLS value dipping from $1.03 million in 2016 to $940,000 next year. Similarly, in the month of October, the National Bank foretold a 20% drop in the rate of detached houses in Vancouver, a 9% drop for attached houses, and a 5 % decline in the prices of condos.

To these predictions, the economist at University of B.C., Tom Davidoff stated that ‘There’s no question the market is getting buffeted by headwinds.’ He also said that these mid-range conjectures are targeting on a modest correction after months of sinking sales in the Greater Vancouver market.

Besides, for Davidoff, Canada will always remain a prized destination and haven in a tumultuous world. “Having a stable democracy with a beautiful environment, over time, is going to be a real strength of Vancouver,” he said.

 

December Vancouver Real Estate pricing
December Vancouver Real Estate pricing. Source: REBGV

 

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Most Expensive Cities to Live In 2016

All are aware of the fact that the sun rises in the east and night falls in the west. Now, whichever part of the world you live in, this fact doesn’t change, but the aura, taste and stories of every city differ all over the world. Hence, every city has its own philosophy and certainly different ways of philosophizing.

Now, to look at the pragmatic side of the picture, the cost of living in a particular city has divided the cities into various segments. The most expensive cities to live in 2016 will be explored here.

According to the latest annual Cost of Living survey, conducted by the investment consultancy firm Mercer, the below-listed cities are the world’s most expensive cities.

1. Singapore

Marina Barrage in Singapore
Marina Barrage in Singapore. Credit to Jason Goh

With beautiful locations and the largest business centre in the world, Singapore, the only island city-state has become one of the most expensive cities in the world to live. With high-rise price tags,

With beautiful locations and the largest business centre in the world, Singapore, the only island city-state has become one of the most expensive cities in the world to live. With high-rise price tags, the cost per square metre of buying an apartment in Singapore is about 23,426.05 S$.

2. Zürich , Switzerland

Zürich , Switzerland
Zürich , Switzerland. source: Tourist Destinations

Zurich is a global city that has the world’s largest banks and financial institutes. According to the survey, Zurich has the best standard of living life. The current price to afford an apartment in City Centre, Zurich is 13,071.43 Fr. per square metre.

 

3. Hong Kong, China

Hong Kong Skyline
Hong Kong Skyline. Credit to Unsplash

Hong Kong is officially known as a special administrative region of the People’s Republic of China. The city boasts of modern architecture. Hong Kong has sky-high prices to match the sky-high setting. In Hong Kong, the present price of an apartment per square metre is 185,282.05 HK$.

4. Geneva, Switzerland

Geneva,Switzerland
Geneva, Switzerland. Credit to http://www.iises.net/current-conferences/academic/32nd-international-academic-conference-genevaIISES

For living in Geneva, you have to spend some extravagant prices for entertainment and pleasure, yet a falling currency has compensated its cost of living for emigrants. To buy an apartment in Geneva, the price you will have to pay is 12,500.00 Fr. per square metre.

5. New York, U.S.A.

New York, USA
New York, USA. Credit to A.H.


Economic Intelligence Unit stated in its report that
“a stronger dollar and localised inflation mean that New York continues to become more expensive relative to its global peers”. 13, 131.47 $ per square metre is the price that you will have to pay to purchase a property in City Centre, New York.

There are other cities including Los Angeles, Tokyo, Shanghai, Seoul, Copenhagen, and Vancouver with the exorbitant rise in prices that have also made it to the list of world’s most expensive cities.

Have you already started dreaming of living in one of these cities? Hope your bank balance is deep enough to fulfill your grand dreams.

Factors That Led These Cities to be on Top of the List

The survey was based on a comparison between product prices to conclude the world’s most expensive cities. The assessed products included food, drinks, transport, clothing, housing, housing goods and recreation. Further, New York City costs were used as a relative baseline and US dollar as the relative currency.

Before the survey was released, it was preconceived that the western countries will hold the maximum places on the list, but the south-east Asian and African countries have surprisingly hit the top positions on the list.

On the other hand, the US dollar has fairly risen in comparison to the Canadian dollar. The rank of cities in Canada has persistently dropped because of the feeble Canadian dollar. Canada’s highest-ranked city, Vancouver clearly hacked down 23 positions lower. Since the cost of living in Vancouver has dropped, people’s hopes for living in this city have awakened once again. After all, the city has always been ranked amongst the top livable cities in the world.