It seems like everyone I bump into these days has an opinion on the real estate market. I hear an assortment of declarations like “It’s another bubble”, “the interest rates are going to spike”, “The US is going back into a double dip recession.” Or maybe it’s because the European Union is in trouble, and on and on it goes. Overnight suddenly everyone is a junior economist or a real estate guru.
I was at a coffee shop just yesterday morning where I heard a young gal in her late thirties talking about the imminent crash of the BC real estate market, and how anyone would be crazy to buy right now. Her opinions were so strong and said with such conviction, that anyone listening would have almost no choice but to accept them as real estate gospel. And why wouldn’t they? As social creatures this is where we get the majority of our information. We are trained to pay close attention to any info that might negatively impact our well-being. This is something that media exploits every day with their fear based headlines.
And here is where it all gets very concerning for me, because with a little bit of investigation I have discovered that most of this “noise” comes from people who have never invested in even one piece of real estate. They are nowhere near qualified to be influencing your decisions.
We have to be careful to only take advice from those who actually walk the walk, people who have held, bought and sold in good times and bad. The best advice comes from someone who is currently in the trenches doing deals at the same time as they are giving their opinion.
I personally don’t think its out of line to ask someone who’s attempting to impart their “knowledge” on you, what their personal real estate portfolio looks like, what you will likely find is that those with the actual qualification to speak on the matter are a lot harder to find than these empty theorists.
So as a person who has been involved in over 100 real estate transactions so far this year and has personally bought and sold a number of my own properties in 2012, I feel obliged to share with you the reality of what is happening right now in the market as we speak and what it all means to you…
So here are some numbers that will paint the correct picture, in bullet form
CMHC forecasting stability and slight up tick in prices for 2013 (2.5-3.5%)
Canadians own 67% of their primary residence as compared with 41% in US
Salaries up 2.9% over all
Job growth 11%
Locally (Central Okanagan)
Over all sales volume (dollars) year over year is up 12.6%
Unit sales are up 14.9% (amount of homes changing hands)
Inventory is down by 200 units. This positively affects demand as supply decreases
In conclusion, the market is very stable. And well into a recovery period. It is comforting to know that although certain major centers in Canada may experience a correction due to over building and affordability issues, our local market has already been there done that, got the T-shirt. Anyone not in a coma for the past 4 years can tell you about the correction and half decade long sales slump.
The majority of the over supply from 2007 has been absorbed, with the development victims of poor timing like; Waterscapes, Martin lofts, Invue and Southwind at Sarsons all finally wrapping up their final sales. There is no glut of inventory being built like in Toronto or Vancouver.
The bottom line, if now is a good time for you personally to upgrade or change your living situation, then the current market is ripe with opportunity and nothing going on economically at a micro, or macro level should influence your decisions otherwise. Just one mans opinion yes, but it comes with a heap of real world experience behind it.