Blog › August 2014

1/3 of Vancouver Single-Family Homes Sold to Chinese Buyers


Buyers with connections to mainland China are snapping up one third of single-family homes in Vancouver– and spending way above the already huge average price, according to a survey by Macdonald Realty.

Macdonald Realty Ltd. said 33.5 per cent of the single-family homes sales in its Vancouver offices in 2013 went to a demographic that included both recent immigrants from China and Canadian citizens with Chinese lineage.

It was also found that those buyers averaged a sale price of $2 million, considerably higher than the average sale price of $1.4 million for a single-family home in Vancouver.

Although some impact is to be expected on the local housing market, it won’t be as big an impact as factors such as interest rates and where they are going.

It definitely adds vibrancy and health to our real estate market, it assists developers so they know that a certain percentage of their condominiums will be taken by buyers from offshore, and it helps with rental supply because without new condos there’s virtually no rental stock coming onto the market in Metro Vancouver.

In terms of whether the buyers are buying to live or for investment purposes, although the survey did not “drill down into intentions”, they believe that “most buyers either plan to live or spend some time in Vancouver” and that not many were pure investors.

The data did not include suburban areas such as Richmond, Burnaby or North Vancouver.



Vancouver Prices Up 4.44% in July, On Par with Canada


Canada’s average house price rose five per cent year over year to $401,585 in July, according to Canadian Real Estate Association (CREA) figures published August 15.

The association said that removing Vancouver and Toronto from the national equation, because those two large and expensive markets “skew” the findings, takes the average Canadian house price to $327,988, a four per cent year-over-year rise.

In the CREA’s breakdown of local markets, Greater Vancouver posted the third-biggest year-over-year increase in house prices at 4.44 per cent, beaten out by gains in Calgary (up 10.48 per cent) and Greater Toronto (up 7.88 per cent).

The number of home sales processed through the MLS® across Canada rose 0.8 per cent on a month-over-month basis, marking the sixth consecutive monthly increase and the highest level for sales since March 2010.

July sales were up from year-ago levels in about 70 per cent of all Canada’s local markets, with Greater Vancouver, the Fraser Valley and the Okanagan seeing the biggest increases nationwide.

Sales activity across the country was up 7.2 per cent year over year in actual (not seasonally adjusted) figures, and up 1.1 per cent over June 2014.

Activity rose in about 60 per cent of all local housing markets in July, with Victoria leading the gains.

“On the surface, national sales activity in July was similar to what we saw in May and June,” said CREA president Beth Crosbie. “That said, July sales picked up in markets that struggled to gain traction in the spring, while activity eased slightly in some of Canada’s largest urban markets.”



Recently Sold Listing 4 - 138 W 13th Ave, Vancouver, British Columbia


V1074111 - 4 - 138 W 13th Ave, Vancouver, British Columbia, CANADAI have just recently sold this listing at 4 - 138 W 13th Ave, Vancouver.

BC Sees Canada’s Largest Drop New Home Prices: StatCan


Vancouver new-build apartment building

 

The price of new homes fell 1.5 per cent across BC and 1.4 per cent in Vancouver in the year to June 2014, according to Statistics Canada data released August 14.

The BC figure is the largest drop of all the provincial regions identified in the report, and Vancouver’s decline is the second-largest drop of all the cities identified – after Charlottetown, where the price fell 1.5%.

Statistics Canada’s new home price index, which measures the total price of both house and land, rose 1.5% across Canada over the same period.

In BC and Vancouver, the declines were due to a decrease in house-only prices, which fell 2 per cent and 2.1 per cent respectively, while the price of land did not change.

The highest increase in new home prices was seen in Calgary, which rose 7.3 per cent, made up of an 8.8 per cent rise in house-only prices and a 4.3% rise in land prices.

Between May 2014 and June 2014, BC and Vancouver’s new home prices both fell 0.1 per cent.

The biggest month-over-month gain was seen in Ontario, where the index rose 1.9% because of a 2.5% rise in house-only prices and 0.3% increase in land prices.

Across Canada, the month-over-month index rose 0.2 per cent. The combined metropolitan region of Toronto and Oshawa was the top driver the June growth, with prices up 0.3% over the previous month. Builders reported market conditions and new list prices as the primary reasons for the increase.



Recently Sold Listing 2 - 138 W 13th Ave, Vancouver, British Columbia


V1074109 - 2 - 138 W 13th Ave, Vancouver, British Columbia, CANADAI have just recently sold this listing at 2 - 138 W 13th Ave, Vancouver.

Why You Can’t Afford Not to Use a Mortgage Broker


buyersBuying BC real estate can be expensive. Vancouver has some of the highest real estate prices in North America, plus you may need to consider the added cost of legal fees, appraisal fees, GST (if it’s a new property) and property transfer tax. Fortunately, one cost you likely won’t need to factor into your budget is using the services of a mortgage broker.

For 99.9 per cent of homebuyers, there is no fee or cost to use a mortgage broker. Many homebuyers I meet in Vancouver are shocked to hear this. They assume that using a mortgage broker, like many things in life, will cost them big bucks. However, mortgage brokers typically get paid a commission by the lender after closing, so homebuyers never actually see or pay this bill. This also incentivizes the broker to work hard and help qualify you for a loan, because they won’t get paid if you can’t get a mortgage.

Despite being free to the homebuyer, independent mortgage broker services offer plenty of valuable benefits and can save you huge sums of money. Here are a few areas where a mortgage broker can help:

  • Comparing mortgages: A mortgage specialist at a bank can only offer you products and rates from that bank, so you won’t have the benefit of comparison shopping through multiple companies – which could potentially save you thousands of dollars over the life of a mortgage and ensure you are in a mortgage that is right for your needs and future plans. Independent mortgage brokers, on the other hand, work with many different lenders to help you find the best mortgage for your needs.
  • Holding your hand throughout the process: Mortgages can be confusing. Should you choose a variable or fixed interest rate? What amortization period makes the most sense? When do prepayment penalties apply? A mortgage broker can walk you through the underwriting process and explain different loan scenarios so you understand exactly what you’re signing. This is extremely helpful for first-time buyers who haven’t taken out a mortgage before and may have loads of questions. It’s also useful for self-employed borrowers or newcomers to Canada, who may have a more complicated mortgage qualification process and need a broker with experience in those areas.
  • Helping you throughout the life of your loan. If you borrow money directly from a bank, you might speak to a different person each time you contact your lender. But a mortgage broker will service you over the course of the loan, so they can help you refinance, answer questions about mortgage portability and more.

These are just a few examples of the value mortgage brokers bring to the table. Many brokers are well-connected in the real estate industry, so they can also help by referring you to other professionals you need such as home appraisers, real estate agents and inspectors. At no cost (usually), a mortgage professional can save you lots of money, time and energy during the home buying process.

But what about the 0.1 per cent who are charged a fee? Those exceptions might be if one or more of the three key elements of the application is in question: income, credit or property. Perhaps there is no income reported and the homebuyer needs to qualify under an equity program, maybe their credit is bruised or they do not have any established credit, or maybe the property is a former grow-op or a complicated co-op situation. But even where the broker has to charge a fee, in any of those situations the client would not be able to secure lending on their own or through their bank at all – so using a broker becomes even more essential in these scenarios.