The real estate industry fluctuated throughout the 2020 year, finishing strong during the fall and early winter months. The last Garbutt and Dumas recap was done in June 2020 which marked an uncertain time with little data to help with future predictions.
Fortunately, there was an increase in activity and September was a record-breaking month for the Garbutt and Dumas realtors (with November being a close second). Rates are low, higher priced properties are starting to move, and land value is increasing.
- Single-family homes went from slow-selling to outrageously active
- Condos remained relatively slow unless they had a strong selling feature (like great view or good neighborhood)
- Big trend towards upsizing. Buyers are wanting more space!
- Multiple offers for certain listings (depends on how saturated the market is in that area)
- The number of homeowners moving out of downtown Vancouver to the surrounding cities is still increasing
- Driven by affordability
- Includes Langley, Tsawwassen, Sunshine Coast, and the Okanagan
- Communities with little population will double in a relatively small amount of time
- This movement will keep the market busy for years to come
- Downtown Vancouver market remained slow
- Buyers finding larger and newer condos in Brentwood for the same price
What makes the market climb?
The real estate market will climb when there is a shortage of supply. When there are limited properties on the market, more buyers are looking at each one. Real estate agents may receive multiple offers on a listing, however only one can purchase the house. The other buyers must continue looking and place an offer on another property when it becomes available. As more buyers enter the market, it can become more competitive, pushing the prices to increase. In a hot market, the offer that is subject free and has a deposit attached will be a real contender.
There is a definite upward trend in the real estate market and here are the numbers to prove it!
A sales ratio breaks down how many sales were completed in each month compared to the total number of listings available. Townhouses had the highest sales ratio with 40% and condos had the lowest sales ratio with 20% – both are significantly high. Townhouses are in high demand and it is estimated that we will see an approximate increase in price of 10-15% by summer.
Low interest rates have also played a role in the real estate market climb. More people can now afford a mortgage and are entering the real estate market. This increases the competition and can help to boost prices. HSBC announced a 0.99 rate. This will put pressure on other big banks like RBC, TD, and Scotia Bank to make their rates more competitive. It looks as if rates will remain low!
A great tool for finding out what type of rate you will qualify for is ratehub.ca. Talk to your bank or an independent mortgage broker for a better idea on your specific situation.
our predictions for 2021:
- The market will be active – lots of up-sizers (due to low interest rates and wanting more space) and down-sizers (due to high prices)
- People will continue moving out of Vancouver into smaller cities and suburbs
- Port Moody, Langley, Maple Ridge, Squamish, Tsawwassen, North Vancouver, and East Vancouver will see record-high prices and sales activity
- Townhouses and detached houses will be hot! Value of property will continue to increase
- Condos will increase in price (but less so compared to houses and townhouses)
- More investors will be coming back
Denny’s advice: buy a house now or you may never own one!
There is a limited amount of land available for single-family/detached homes to be built on. With a decreased chance of a newer house being built in your community, there are fewer properties to compare to when looking to sell. This leads to less competitive pricing, which will in turn increase selling price over time.
It is hard to know for sure if all of our predictions will come true, but one thing is for certain: the Garbutt and Dumas realtors are looking forward to helping you navigate through all things real estate in 2021!
Listen to The Garbutt+Dumas Real Estate Podcast: 2020 Greater Vancouver Market Recap – What’s Happening Now and What to Expect Next Year episode to listen as James and Denny discuss more about what trends they have seen and their predictions for 2021.
Do you have questions regarding low-interest rates, the upsizing trend, the popularity of apartments and townhouses, and the growing appeal of moving out of the city and into the surrounding areas? We would love to hear from you – contact us and we can help you with some of the specifics.