How is the Real Estate market now? should i keep looking for a house for sale or maybe I should wait when the market quiets down. but what about my own house? Should I list the house on MLS® and sell my house now, or maybe I should wait a bit longer to see how the real estate market and its new listings inventory plays?
As a REALTOR®, I come cross this questions and confusion daily.
To determine the scale of low and hot market, it all depends which side of the scale f real estate you are standing.
Generally the scale of market has two sides:
1. Real estate Buyer's market
2. Real estate Seller's market
Two factors help the scale of real estate market go back and forth.
A ) Demand
B ) Inventory
Now lets place it in the description. When the inventory (House/Condo/Townhouse for sale) is limited and low, obviously demand is higher and the number of buyers increase. This tips the scale toward Real Estate Seller's market. When the inventory increases over 70% and satisfies most of the existing demand, the scale goes to the other side and it favors real estate Buyer's market.
Ok! We understand how the real estate scale of buyers and seller works. Lets go back and see how each real estate buyer or seller is different.
Lets talk about Real Estate buyers,
- Buyers who are real estate investors:
These category, are only functioning around certain market. The rule of thump is to buy a house for sale in low price and list it as a new listing for sale in a higher market.
So most these real estate investors favor buyer's market which they can negotiate and buy a property for sale at a lower price that is listed.
- Buyers that are relocating, down-sizing, up-sizing:
These categories, have other reasons to purchase and despite of the real estate market and its scale, the purchase is based on the immediate need.
- Sellers that are investors:
These sellers are keen of real estate seller market where the demand of the buyer is higher and they ca sell their home for higher price, and even in most cases over asking price.
- Sellers that are relocating, up-sizing, down-sizing:
The same as real estate buyer above, these sellers regardless of the real estate market scale, are making decision based on the immediate need.
Based on the above real estate market and scale, which category of real estate buyer or seller are you placing yourself? Then you can respond to the original question.
Real Estate market changing. We went through a tremendous demand of buyers in 2016. this trend still continues at a lower scale of 40ish% which yet keep real estate at a Seller's market side. There are still low amount of inventories in greater Vancouver and high demanded areas.
With up-coming changes in mortgage rules, effective in January which the federal bank is testing the approval of people with 20% and more downpayment, the market can certainly be effected as many buyers must be approved 200 points above the approval mortgage rate. This will dramatically lower the affordability price, which consequently can effect the demand. Currently up until January there are scores of buyers trying to settle their mortgage and find a real estate for sale, but with shortage of inventory, it can be quite challenging.
Need to know more and talk about where we go in Real Estate? Contact me today and I'd be happy to talk.
Personal Real Estate Corporation