A Good Time to be a Seller - It Would Seem

Does this automatically imply that this is therefore a bad time to buy?

By Alan  Skinner

I generally steer clear of sweeping statements like this month's headline. The reason it appears here is that the first 3 months' results on our North Shore show that those who did sell in this time frame far outperformed those selling in the comparable 2009 period. Albeit that that was an economic low point.

Does this automatically imply that this is therefore a bad time to buy? Only if one believes that market values are turning and will start moving down. This will however only happen if buyers collectively retreat from making the decision to buy. I will go out on a limb and say that the demand for "re-housing" will not drop with any significance in the short term. My belief is based on a few factors. Firstly, the fact that multitudes of property seekers have pre-approved mortgages at rates below those emerging in the new "rate sheets" of the majority of lenders. These mortgage loans will need to be drawn down before their terms expire – anything from 30 – 90 days. Secondly, a one-time phenomenon (until the next one-time phenomenon ;) ) – that of the July 1st introduction of the HST. New construction of $500k will cost $3,500 more once June 30 becomes history – a $1mm unit $7,000; $2mm unit $14,000 etc. I do have some sympathy for the legal/notarial property conveyancers and their late June workload as many buyers squeeze under that month-end gate. What, too, of the moving companies? Reminder to those needing to move June 20 – July 5 this year – book early!

Will this double whammy, tax and rate increase, mean the end of local civilization as we know it? Again, an opinion – no. The "Chicken Little" reaction is not called for, although, obviously these incremental economic factors have, at least initially, some effect on prices and activity. Affordability does impact demand and will almost certainly put the brakes on the current round of housing price inflation.

Oh, and before we leave the topic, as I've often said, make sure to get a mortgage rate pinned down if you may be a buyer in the short/medium term. Think of it as a "financial prophylactic".

Now, what are these first quarter 2010 figures I've extracted from the REGBV database upon which I have based my comments. Here goes… North Van detached homes sold are up by 67% from the 1st Q of the previous year, attached (t/hses) up by 117% and apartments up by 53% from '09. Detached average prices up 29% and inventory Mar 31st, down by 15%. Average prices up 26% (t/hse) and up 27% (apts). Inventory (t/hse) 34% lower than '09 and (apt) up 11% from '09. N/Van inventory other than apartments (additional 38 units) is still lower than 2009. Demand is still strong and, unless we see a significant number of new properties coming on the market, this will continue to keep sale prices in the upper range.

In West Van, detached number of sales is up by 88% from '09. Average price up by 11% and inventory Mar 31st down 5% from '09. On the condo side – attached (t/hses) sold are up from 2009 to 19 vs 1 unit; average price up 103%. Active listings are up from Mar 31st (48 vs. 37). Apartments reflect 42 sold vs. 23 during '09 – an 82% increase; with average price 30% higher than '09 and active listings down 8% from Mar 31st 09.

Overall North Shore demand continues to be strong with inventory, other than townhomes (11 more), lower than 2009.

An aside – tax revolts do not have an "effective" history in Canada in this modern era (and this is actually what the HST debacle is – championed strangely by the major left wing political party). My prediction, not based on political factors, but our history of Canadian pragmatism is that the 'movement' will fail, and harmonization will be rationalized as administrational efficiency.

Again, visit my website to see and "hear" the new developments. I continue my commitment to keep you... www.OnTopOfTheMarket.ca - the "go to" site for North Shore Real Estate analysis and jumping off point for FULL market listing information.

To join the group getting the e-mail version of this "update" - send a request now to alanskinner@shaw.ca and you'll be assured receipt; phone me at (604) 988-7368 or visit www.OnTopOfTheMarket.ca

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Recent Articles by this columnist: The Pulse Is Quickening? Friday, August 20, 2010 What is a "Buyers' Market"? Friday, June 11, 2010 Yes We Are Seeing A Build Up Of Inventory Wednesday, May 12, 2010 What a Ride for Vancouver and Canada! Monday, March 08, 2010 Real Estate - A Backseat to the Games? Monday, February 08, 2010 All articles by Alan  Skinner			Related Links: Alan Skinner Related Articles: