With the current strength in the Vancouver Real Estate market matched with historically low mortgage rates to go with it, one would say “How could we possibly be headed for a meltdown?” Current inventory is low which is again sending Real Estate transactions into multiple offer situations with buyers paying $10,000, $20,000, and, in some cases, even $200,000 over the list price. Although the latter is for a specific product in a couple of choice neighborhoods it still has happened. The potential for a bubble is definitely there but not on a broad scale. It looks more like the micro-markets of Vancouver Real Estate that are getting too far ahead of themselves are at the most risk for a bubble.
The Vancouver real estate market has remained strong despite the meltdown of our neighbors to the south. Thanks to a more closely guarded banking system, Canada has been able to slide through the mess relatively unscathed. The question is: Now that the Olympics games are over for Vancouver, will the much-anticipated financial hangover begin?
The Vancouver condo and townhouse market has seen growth over the past year at a pace that has all the right conditions to stay sustainable. 1st-time buyers are generally the demographic in this category and are taking advantage of the low mortgage rates. With the recent changes imposed by the Canadian Government on mortgage lending, we should have a little more of a cushion against an overall bubble. The changes which include anyone seeking for a mortgage less than 20 percent as down payment would haveto meet the needed requirements in 5-year term fixed rate on mortgage, regardless of the term they were seeking. Another safeguard was to lower the amount of equity one could withdraw from their home for refinancing purposes from 95 percent to 90 percent of the appraised value. In the case of a market retraction, it would give a little more cushion for those who are spending close to what their home is worth. view additional information at https://www.placerealestate.ca/yaletown
Although there are some challenges ahead the future still looks very bright and promising for the Vancouver Real Estate market. Some lessons have been learned that in hindsight should help the City and Country avoid the same mess the U.S. got themselves into. There may be, though, pockets of different bubbles where ignorance is driving the people into a form of frenzied buying, as well as driving prices to unsustainable levels. On a broad scale, the city’s real estate market will see slow growth through the remainder of 2010 with a moderate increase going into 2011.
The $700,000+ debt left on the shoulders of the Vancouver taxpayers for the construction of the Olympic Village will hopefully be recouped over the next decade. According to recent reports, one local developer was able to cash in on $31.8 million in high-end units from people visiting for the 2-week Olympic period. The village will house approximately 1100 units of mixed income households in a sustainable community of shopping, services, and parks.
Terry Voth is a Vancouver Realtor who specializes in the sales of Vancouver Condos, Townhouse and Houses. Invest in Vancouver and your future will be secured!