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Our last month review of the Vancouver real estate reveals that sellers are now listing their properties at a price experts described as “reasonable”. The trend yet persists as the condo and the condo price falls to the lowest compared to any other major market in Canada.

In spite of the price plunge, Greater Vancouver’s condo still leads in terms of valuation. For instance, Greater Toronto condo which has appreciated by 9.1 per cent since the beginning of the year is still valued at a lower price ― although at a low different margin.

Condo Per-Square-Foot Price Depreciates by 8.3%

This was revealed in a report by a real estate firm, Royal LePage. According to the report, per-square-foot of a condo in Greater Vancouver now costs about $764 compared to other years when it was priced at an average of $1,044. The market can be said to have depreciated by 8.3 per cent year-over-year, the report indicated.

Commenting on the dominance of Vancouver’s condo pricing even though it plunged, a real estate with Royal LePage, Adil Dinani said; “With a deceleration in Vancouver’s condo market, buyers for the first time in several years can benefit from the changing landscape,”

Buyers Checking Our Neighbouring Locations

This high pricing has made lots of buyers continue to look elsewhere for properties, especially the neighbourhood. Burnaby, the Tri-Cities, and the Fraser Valley are reported to have offers that entice these buyers the most.

As much as many buyers are looking outside Vancouver for enticing deals, there are others jumping back to the market.

Buy a Home Win Model 3 Tesla Promo

In a development that looks like the most extravagant bonanza ever, a real estate firm, Century Group started a give away of Model 3 Tesla base model to 10 buyers of its remaining 10 homes at its newest development, Viridian in South Surrey. The promo is expected to run from September 14 until October 31.

The president of the company, Sean Hodgins revealed in a press release the gift is possible with their partnership with Tesla.

So far, it has been good news about the Vancouver real estate market even though we noted the plunges made Greater Toronto condo price few dollars below-average price compared to the Vancouver real estate.

The general market of the Greater Vancouver real estate even though has been improving, it is yet to meet up to those of previous years, not even last year. However, experts describe it as a stage the market is entering technical correction.

The local board benchmark price, REGBGV reported that the benchmark of a conventional Vancouver’s home in August cost $993,000 in August. This is a price that is about 8.3 per cent lesser than the same time last year.

Vancouver East experienced even a higher decrease of 9.3 per cent compared to last year. The price was $1,033,400 this year’s August.

Same thing with higher-priced Vancouver West. Which also fell by 9.3 percent. The price of a typical home in the region in August was $1,226,200.

Falling Price Good News for Buyers

The price fall might not be good news for sellers but it presents an investment opportunity for sellers looking into breaking into one of the most lucrative real estate regions in world. The Better Dwelling reported more buyers are now coming back, with sales increasing two-fold compared to same time last year.

In the REGBV report quoted, there were 2,231 sales in August ― 12.7% reduced from last month’s (July) sales. But 15.7% higher than the same time last year. This can be celebrated but it is also it is still 9.2 per cent lower than average of previous 10-years August sales. In fact, this is the second-fewest August sales in the past 5 years.

Announcing the improvement, the REBGV president said “Home sales returned to more historically normal levels in July and August compared to what we saw in the first six months of the year.”

Condo Listed and Sold in Four Days

In a deal documented by the Globe and Mail, a listed condo only spent 4 days on the market before being sold. The asking price was also the paid price. However, the agent in charge of the property noted it would have worth about $100,000 more if it was listed and sold last year.

There Are Lesser Listings Too

The slight improvement in sales and price may be accrued to the decline in the new listings in Vancouver. According to the REBGV report, there were only 3,747 new listings in August. This is about 18.8 per cent lower than that of the previous month (July).

According to the Better Dwelling analysis, “The monthly decline is typical for the season, but the more modest annual decline is not. Even with a drop in new listings though, the number of total listings continues to swell.”

The total number of active listings increased (13,396) but yet lesser than the previous months (about 5.9 per cent lower). This can be said to be as a result of the higher sales.

The active sales to the active listing ratio (SALR) reached 16.7 per cent which is higher compared to last year’s 16.3 per cent.

Stats like this is important in real estate because it interprets the trend of the market. When the SALR is below 12 per cent, there is a high tendency for prices to significantly fall. When above 20%, the prices are presumed to rise and when in-between, it is considered a balanced market.

Looking at the case of Vancouver which is 16.7 per cent, the market although can be described as being balanced, it can be noted that the balance tilts more to the seller side. A ratio of about 13 or 14 per cent can be considered as a balanced market favouring buyers more.

Considering this analysis, the Vancouver real estate market problem is that sellers are not willing to sell at a price buyer are willing to pay, even though they may be desperate to sell.

Vancouver Real Estate Expected to Stabilise by “2020”

Good news for investors! The Vancouver real estate is predicted to “normalise” by 2020. On the other hand, sales are expected to drop in 2019 by 5 per cent and significantly rise by 11 per cent in 2020.

This was according to a forecast by the British Columbia Rea Estate Association. The prediction also stated housing prices will fall by an average of 2.4 per cent this year and will likely rise by 3 per cent in 2020.

Vancouver Properties Exhibited in Hong Kong

Hong Kong economy has been experiencing some serious crisis especially due to the consecutive protests by its citizens.

Vancouver developer are leveraging this uproar to get the Hong Kong real estate investors to Canada. The Hong Kong vice president of international property at Soho, Eli McGeever was quoted by BIV to have said ““In the first half [of this year] there were 55% more exhibitions of Canadian property in Hong Kong than in the prior half,”

The report showed four real estates taking the vanguard in wooing Hong King investors to Vancouver ― Enrich Developments, Shape Properties Group, Westbank Corp. and Aspac, McGeever.

Is This Yielding Any Result?

The resulting security risk of the Hong Kong protest has in the last months tremendously hike the number of applications for foreign visas in the country.

The number of applications compared with a year earlier in June (12 per cent); July (41 per cent); and August (48 per cent), according to the statistic released by Juwai.com.

In spite of this, it seems Chinese migrant are looking elsewhere instead of Canada. They prefer Asian countries like Malaysia which is more affordable.

Why Are Developers Then Targeting Hong Kong?

There are about 320,000 Hong Kong residents already with Canadian passport. This is the group the developers are targeting and they are also interested in interesting in Vancouver.

A report revealed that Hong Kong residents are interested in properties in West Vancouver, Vancouver, and Richmond.

For the first time in a long while, the Vancouver real estate is experiencing its lowest in pricing. The market was at its highest point in 2016 but a different story today.

The bearish market has made the sellers switch seat with the buyers. Even though a reduction in the property price was expected, it wasn’t predicted to be this bad, according to a local realtor, Barry Magee.

Magee’s statement came after his review of the sales data prepared by the Real Estate Boards of Greater Vancouver and the Fraser Valley. The review revealed the sum of all property sold in Vancouver for the first 6 months of 2019 was lesser than the same recorded from 2016 ― $15.6 billion (2019) compared with $38.1 billion (2016).

The sharp drop and the forecasts of more drops were considered by Magee to be a comeback to reality and that it would be better for the society in general. He considered the housing price to be outrageous.

Buyers now have the superior power to dictate a real estate worth instead of the other way round in previous years like 2016.

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The Real State of Real Estate in Vancouver

Owning a home in Vancouver is a dream come true for many, a dream that seemed unattainable in recent years due to increasing real estate prices in this region. However, as the reports show a decline in the market; this is the best time for prospective homebuyers to get in.

Vancouver is the third most expensive city in Canada. It’s located in the Southwestern part of British Columbia and has massive cultural diversity and natural beauty due to its proximity to the Pacific Ocean. Real estate prices in this area have been driven up by demand for houses fueled largely by wealthy immigrants who moved into this area because of lenient laws on home ownership and diversity in the city.

According to a new housing forecast report by Central 1 Credit Union, British Columbia is in a mild recession with the mainland shifting from a seller’s market to a buyer’s market. Recession is a period marked by economic decline, a sharp drop in home sales, and a slowdown in housing starts. In the month of April 2019, resale of residential properties dropped 17% from 2017 to 2018, while housing starts slowed by 10%, with another 18% drop forecast for 2019.

Nevertheless, it’s not all gloom for homebuyers who can enter into the real estate market by snagging up prime houses at a lower cost and reaping the gains once the market stabilizes. According to the Conference Board of Canada, the slowing growth in this sector is expected to last for at least two years.

Detached Homes Sales Drop

From the latest figures from the Real Estate Board of Greater Vancouver (REBGV), sales are now lowest in three years. According to REBGV, the price of a detached home is dropping. The report shows the Greater Vancouver detached benchmark dropped down to $1,404,200 a drop of 11.1% from last year. A decline of 26.7% was recorded on detached homes compared to last year the same month.

The report further indicated that the eastern part of the city’s prices dropped to $1,357,200, 12.1% drop from last year. Western Vancouver wasn’t spared and performed even worse. The prices dropped down by 13.4% from $2,950,000 last year. As per the figures, the losses in just one year range between $177,000 to over $440,000. This downturn is driven by policy measures such as the introduction of speculation tax, school tax and a slump in the economy of the region.

The popularity of new listings of detached real estate in Vancouver is currently high. REBGV reported a 234% increase in new listing compared to a month before. This being twice as much as last year, leading to a decline in demand thus reducing the number of sales. As much as this news is bad for sellers, it is good news for buyers. It would be prudent for one to buy a detached house at this moment, as the prices are hugely low.

Things are not as dire as they seem. In spite of the declining price, which is projected to last for at least two years, there is a positive outlook. On the bright side, home inventory is exchanging hands, which only means money is circulating. The board reported 1966 transactions in the month of April an increase from 1727 reported in March. Maybe this increase is due to the season (spring) which previous data shows the number of sales increase during this period.

This April has received the most detached inventory since 2014. The listings reached a multi-year high end for the month. The total numbers of active listings were 6,236, a 10.39% rise as compared to the previous month. As compared to April last year, the figures represented an increase of 8.71%.  

Why Real Estate Is Becoming More Expensive

Central 1 Credit Union chief economist Helmut Pastrick told the Vancouver Real Estate Forum that prices will likely double between 2016 and 2014. The reason for this is simple: An increasing populace and the need for developers to build more homes to accommodate the increasing demand. Now throw in the effects of new regulations and higher construction costs in terms of material and labor and the real estate prices shoot up rapidly.

There is also the question of affordability. Jonathan Woetzel from McKinsey & Co. a leading consulting firm in Cities Special Initiative foresees that third city dwellers will have inadequate housing by 2025, the price of the real estate is the reason why.

That’s a combination of people who just can’t find housing, there isn’t housing there for them, and people who have to pay too much for housing,” he explained. “So Vancouver, you’re not alone.

The government can’t spend to plug that deficit which is quite huge and would be very expensive. The private sector developments are what is needed to bring in new housing units are that well priced to the majority of the city dwellers.

New Policy Measures

British Columbia government introduced a foreign buyer’s tax in 2016 in response to increasing home prices driven by wealthy immigrants. In the last year, this rate has gone up from 15% to 20%.

The market has been hit by a Federal Mortgage Stress Test which is meant to reduce the amount borrowers can take out on a mortgage and mortgage rates have gone up in the last two years. In addition to that, the city has introduced a vacant home tax that could force investors and homeowners to sell at the current market rate.

These measures are meant to reign control on the housing market whose prices are rising too fast in the short term but ultimately don’t do any good. However, many experts agree that these measures are forcing the market to adjust pricing in the long term and removing the foreign buyer’s tax and mortgage stress test will cause the price to start rising again and lead to mortgage debt stress on homeowners

Real Estate Board of Greater Vancouver stats shows a 30 percent dip of buying compared to last year. Buyers are fearful of buying now when the prices are still decreasing. But according to a report by Pollster Angus Reid, families or singles with lower debt are well positioned to buy right because they will make a killing once the market stabilizes. There is one thing that professionals agree on; real estate prices will start increasing in the near future.

Sales were down in February 2019 over the sales of February 2018 but they were up over late 2018 and January 2019. Although prices are adjusting, particularly in the detached home market, it is important not to confuse lower sales numbers with lower prices. In checking price point changes, we use the benchmark price comparison where model homes with standard popular features are measured against homes of that type that have sold that month. When average sale prices are used they are just looking at prices of homes that have sold divided by the number of sales. In this market where fewer high priced homes are selling a lower average price is attained and suddenly the sky is falling. Not a realistic measuring tool. However, some economists are predicting a larger price drop before rebalancing again. Buyers now have variety of options to choose from , as well as having a chance negotiate to get the

best value home.

Affordability is the elusive goal of governments around the world and there are many ways to crash the economy in trying to achieve it. The Federal Government in its recent election budget is trying a system called SEMs or shared equity mortgages. These have been tried in Australia, the UK and US. According to the Haider-Moranis Bulletin the SEM will be run by CMHC which is a long way from being ready to implement such a program. In Canada there is an assumption that millennials have an RRSP of more than $35,000 that they can borrow from for a mortgage or they can share their mortgage with CMHC as the lender for up to $40,000 to reduce the monthly payments of the mortgage with the loan for the SEM being paid back at the end of the mortgage or the sale of the property.

There is a discussion on just how soon this election goody can be mobilized. There are lots of offerings in the Budget that are not fully funded in a timely fashion, including the Home Buyers Plan.

Anne McMullin, president and CEO of the Urban Development Institute in BC, is on the frontlines with developers and politicians trying to create more affordable communities for those who live here and for the up to 40,000 newcomers who will arrive in Metro Vancouver this year plus another 140,000 foreign students and temporary workers. As it stands now there is not enough rental housing or affordable homes to buy for the people who live here now. Over the next three years the number of housing starts is predicted to go down by 30 per cent. In her Vancouver Sun article Ms McMullin outlines suggestions to make more housing possible:

• Build more homes of all types by opening up communities to options such as townhomes, row homes, micro-suites, triplexes, mid-rise buildings.
• More purpose built rentals through financial incentives or targeted tax breaks
• Link transit funding to building apartments and other home choices near transit hubs.
• Government should ensure fair taxation on homes. Piling on development charges creates more expensive housing for buyers or renters.
• Approval process should be faster, particularly in Vancouver where the approval process takes up to 5 years.

Vancouver’s Property Evaluation Monthly Market Report 2019 Highlight

For all property types the sales to active listing ratio for February 2019 is 12.8%.

In February 2019 the benchmark price for a detached in North Vancouver was $1,492,400 down 11.5% in one year, up 55.2% in 5 years and up 93.2% in 10 years.

In Richmond the detached benchmark price was $1,546,500 down 12.1% in one year, up 57.0% in 5 years and up 121.1% in 10 years.

In Vancouver East the detached benchmark price was $1,412,900 down 9.5% in one year, up 61.5% in 5 years and up 137.9% in 10 years.

In Vancouver West the detached benchmark price was $3,029,200 down 13.5% in one year, up 41.1% in 5 years and up 128.2% in 10 years.

In West Vancouver the detached benchmark price was $2,616,500 down 16.7% in one year, up 35.7% in 5 years and up 108.8% in 10 years.

Each year affordability declined for local buyers. First time buyers are particularly hard hit by mortgage stress tests, high prices and lack of affordable inventory.

In February 2019 the benchmark price for a condo apartment in North Vancouver was $561,500 down 4.7% in one year, up 56.7% in 5 years and up 80.1% in 10 years.

In Richmond the condo benchmark price was $660,100 down 2.0% in one year, up 78.3% in 5 years and 109.1% in 10 years.

In Vancouver East the condo benchmark price was $545,200 down 3.6% in one year, up 74.8% in 5 years and up 108.7% in 10 years.

In Vancouver West the condo benchmark price was $784,300 down 6.2% in one year, up 61.0% in 5 years and up 98.2% in 10 years

In West Vancouver the condo benchmark price was $1,103,800 down 10.8% in one year, up 57.1% in 5 years and up 83.4% in 10 years.

Vancouver is an area desirable to live. Attractive with a clean and safe environment and mild climate due to the surrounding of mountains, and also full of outdoor recreation, it has raised the demand of housing which continues to grow tremendously within Canada and also overseas. A new study shows that there is a historical demand level as termed by The Real Estate Board of Great Vancouver since there is a drop in sales and prices for Metro Vancouver homes.

A report indicates that over 1,600 residential homes were sold in Vancouver in November. Home prices have dipped 4% to 7% in the past six months depending on the type of property. The conditions will be watched by the board in the first quarter of the year 2019 in order to see whether the buyer demand will pick ahead of the active spring market.

Real estate typically revolves around the world and new supplies are getting into the market. Due to the high level of immigration, population growth in Canada has accelerated in the last few years which is now growing fast. Canada’s future on affordable housing still remains bright. Policy makers in Real estate markets will have approved important key parts aimed at protecting tenants.

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Information is retrieved from Government of Canada.

1. About the process

Permanent residency in Canada can be gained if you submit the interest to sponsor form and later invited to submit a complete application. By doing so, you can sponsor your parents and grandparents to be permanent residents of Canada.

A MUST things to do include:

• supporting them financially.
• Ensure they don’t require any social assistance from the government.

2. Eligibility

Requirements to sponsor your parents and grandparents are:

• Be physically living in Canada.
• Age-18 years and above.
• MUST be a Canadian citizen.
• Living in Canada permanently.
• Those registered as Indians in Canada MUST be under the Indian Act.
• Have enough money to cater for the persons you want to sponsor.
• Provide documents on sources of your income.

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