First-timers drive a rebounding market
'Vancouver detached house prices are the lowest they have been in two or three years,' say one couple convinced that the time is ripe to purchase
Judging from the many shoes littering the front porches at open houses in recent weekends, it's clear that people are back buying houses.
Without a doubt, the market has picked up, and we're barely into March. It's a far cry from the abysmal real estate market of last fall and January this year.
According to the Real Estate Board of Greater Vancouver, residential housing sales were up 94 per cent last month compared with January. That translates into 1,480 sales for the month of February alone. January, on the other hand, was a record-setting sluggish month - the slowest for housing sales in 25 years.
The growth defies the sky-is-falling pronouncements that have made headlines since September last year. But there is a growing perception that it's a buyer's market. A recent RBC/Ipsos Reid poll revealed that 26 per cent of B.C. residents surveyed believed they would purchase a home in the next two years, despite the view that house prices will continue to fall over 2009.
The condo market is also feeling a surge of life, real estate marketer Bob Rennie says.
"Sales are up," he says. "We have sold 19 [units] at One Madison Avenue in Burnaby in the past six weeks, and another nine at L'Hermitage at Robson and Richards in the past 10 days.
"I do think that the market is seeing a little bit of confidence, combined with some great opportunities with great interest rates."
Armed with low interest rates and realizing a good deal when they see one, brave contrarians are defying fears.
"People can see the value - and the value is phenomenal," real estate agent Lorne Goldman says.
Mr. Goldman says he had a house for sale last year on the city's pricey west side with an asking price of $2.4-million. The sellers were offered $2.3-million, but the buyer failed to complete. The same house is now on the market for $1.85-million.
"It's also very basic Real Estate 101," he adds. "There are people who are getting married, there are people who are married having more children, people being transferred into Vancouver from other cities. There are people who have inherited money who want a bigger house.
"The market continues, despite what is out there in the general economy. The fundamentals are there. People still need to buy groceries, and they still need shelter."
Karin and Sean Whale are unfazed about talk that house prices may fall further or that it's not a good time to sell a home. They recently had a baby and are motivated by their changing lifestyle.
The couple owns a three-storey townhouse on the east side of the city near trendy Commercial Drive, and with the latest addition, they've outgrown it and are looking to trade up to a detached house. They don't worry about selling and buying into the same market.
"Buying low and selling low is not a scary proposition to us," Ms. Whale says. "We need more space at this time in our lives ...Vancouver detached house prices are the lowest they have been in two or three years."
Long-time Vancouver real estate agent David Campbell says that, unlike a year ago, it isn't the fixer-uppers and in-between houses selling. Demand is high for nice ones that don't require a lot of work, and there aren't a lot of them on the market. And the people buying, he says, are either first-time buyers or homeowners such as the Whale family who are trading up.
"We have many buyers, but we have seen the return of first-time buyers," Mr. Campbell says. "For a good part of, let's say, the last nine months, first-time buyers have been staying out of the market. They were a little scared as to what was happening last fall. But interest rates are at record lows, and prices have adjusted downward, and there are lots of first-time buyers coming back.
"We're getting a lot of move-up buyers as well taking advantage of the low interest rates who say, 'Now I can afford that spread up to the next one.' "
And unlike last fall, when the bottom fell out of the market, they aren't making low-ball offers - the prices have firmed up, he says.
"Last Sunday I had the busiest open house since April," Mr. Campbell says. "I had three offers on a house in 24 hours and it sold over asking."
But not just any house is selling, he adds. Buyers are being selective in this uncertain market.
"They want a good home, so they are picking the better ones," Mr. Campbell says. "That's where we get multiple offers."