Here’s a market update from our friends at Macdonald Realty; Simon Clayton, Jason Low, Sandra Ens, Jason Feinstadt, and Jenny Stephanson.

June 2011 Market Update

With the recent election of a majority Conservative government, what does this mean for the housing sector?

Most financial analysts agree that the business-friendly Conservatives will continue to prioritize the health of the overall economy, a message that will be well-received by the investment community. This, combined with the first majority government that Canada has seen in over half a decade, provides a platform of stability that financial markets crave. These two factors will amplify Canada’s already strong economic reputation and will give us the best chance of having a strong, stable economic base in the near- and mid-term.

“The more stable government is good news for foreign investors, particularly as balancing the budget remains high on the agenda,” says Jennifer Lee, senior economist with BMO Capital Markets. “With its majority hold, the Conservatives will likely blunt the impact of the new official opposition, the NDP. And with the Bloc Quebecois losing official party status, separatist issues will retreat to the back.”

Policy-wise, the Conservatives did not outline any new housing-related initiatives during the election. However, in their last term, they moved to increase the insurance requirements of the Canada Housing and Mortgage Corporation (CMHC) in order to cool off the run-up in real estate prices in certain jurisdictions. These new rules effectively tighten lending requirements, which is seen by many as a necessity during this low-rate environment to deter boom-and-bust real estate cycles.

The rapid appreciation in prices over the past year, especially in some areas of the Lower Mainland, is getting the attention of government officials. It is believed that these prices have been driven up by Chinese investment, as these neighborhoods represent the areas where investor class Chinese immigrants tend to settle. That said, the Conservatives worked very hard to court the new Canadian vote in the previous election and their platform seems to indicate that they will increase the number of economic immigrants – at the expense of other immigration categories – rather than reduce them.

So while it is unlikely that this government will do anything other than encourage economic immigration, there is a growing concern that locals are being priced out of the market. Whether government policy is put in place to rectify this is something to watch, although, given that it really only affects Vancouver, it seems unlikely.

Overall, it seems as though this new Conservative majority government is positive for the housing market. That said, government policy and leadership only plays a small role in the economy. When things go well, they tend to get too much credit. And when things go poorly, they receive a disproportionate amount of the blame.

June 2011 Market Update

If you would like to learn more, please feel free to contact us by phone or by clicking on one of the links below:

Simon Clayton 604-764-0711

Jason Low 604-790-5276

Sandra Ens 604-263-1911

Jenny Stephanson 604-675-6214

Jason Feinstadt 604-263-1911

MacDonald Realty 604-263-1911

Here’s a market update from our friends at Macdonald Realty; Simon Clayton, Jason Low, Sandra Ens, Jason Feinstadt, and Jenny Stephanson.

May 2011 Market Update

The Spring Market is underway. For those of you thinking about selling, it is important to realize how vital the Art of Pricing is to the sale of your home.

All sellers want the highest price possible for their homes, but the strategies to get there are not always intuitive. In certain circumstances, pricing low can be more effective than pricing high, while in others, pricing above market value can be a winning strategy. In most cases, however, the optimum pricing strategy is to price within 10% of market value and let the market decide. After all, the ‘list price’ comes with a caveat: Or Best Offer.

Top 5 Reasons for NOT Pricing High:

• 1. You lose out on potential buyers who put a price cap on their property searches.
• 2. Serious buyers question the motivation of a seller with an overpriced listing.
• 3. You provide a strong comparable for your neighbours who are properly priced. You are effectively selling other people’s well-priced homes.
• 4. Buyers assume that properties which remain on the market for long periods of time have something inherently wrong with them.
• 5. Other agents will be more hesitant to show your home.

May 2011 Market Update

If you would like to learn more, please feel free to contact us by phone or by clicking on one of the links below:

Simon Clayton 604-764-0711

Jason Low 604-790-5276

Sandra Ens 604-263-1911

Jenny Stephanson 604-675-6214

Jason Feinstadt 604-263-1911

MacDonald Realty 604-263-1911

Here’s a market update from our friends at Macdonald Realty; Simon Clayton, Jason Low, Sandra Ens, Jason Feinstadt, and Jenny Stephanson.

April 2011 Market Update

With the Spring Market in full swing, it is important to know that not all agents and not all real estate companies are created equal. When hiring a professional to sell your home, take the time to ask them what their sales model is to ensure that it meshes with your goals.

Below, I outline what the Macdonald Realty Model is:

The Macdonald Realty Model

For most people, their home represents the single largest investment that they will ever make. In addition, the government encourages home-ownership by making principle residences one of the few investment vehicles on which CRA does not tax capital gains. Because of this, it is important for owners to make an informed decision about how they sell their home.

Macdonald Realty has prided itself as being a full-service real estate company since 1944, but what does that mean? Macdonald Realty’s full service model means taking a client by-the-hand and guiding them through the process of (1) Evaluation, (2) Marketing, (3) Negotiation, (4) Completion, and (5) Post-Completion to ensure that they receive the best price and conditions for their home, with as little inconvenience as possible, while limiting financial and legal risk.

• (1) Evaluation
  • A Macdonald Realtor will provide you with a comparative market analysis (CMA) that outlines the strengths and weaknesses of your home, along with the current market conditions, including both recent sales and current listings, so that you may make an educated choice when it comes to pricing. Pricing is an art, and along with this information, your Macdonald Realty agent, as a full-service professional, will be able to explain who the target market is and how to maximize value. Do you price low to attract a competitive offer situation or at market value to ensure you only work with motivated buyers? Perhaps you price high to leave yourself room to negotiate?Remember, homes are NOT commodities, every house is different, and a Macdonald Realty agent will be able to explain to you why they came to their pricing recommendation.
• (2) Marketing
  • Effective marketing is crucial to ensure you get the best price for your home. Marketing doesn’t stop at placing a sign on the lawn and posting your house on MLS. A Macdonald Realtor, in consultation with the client, can provide a market analysis and property review to give you suggestions on how you can effectively improve the appearance of your home. In addition, they will respond to buyer/realtor inquiries, conduct open houses, qualify buyers for private showings, utilize the Macdonald Realty creative marketing department to create high-quality marketing materials, provide an online presence on Macrealty.com and other channels, utilize print advertising and social media tools, and leverage company programs and affiliations like Leading Real Estate Companies of the World, the world’s largest residential real estate network with over 140,000 affiliate agents worldwide.Your Macdonald Realty agent will also perform legal tasks like checking title, securing strata documents, and assisting with the property disclosure statement so that your legal and financial interests are fully protected.
• (3) Negotiation
  • A Macdonald Realtor has been trained to provide advice and guidance throughout this process to ensure that you protect your own interests while maximizing the value for your home. It is important to have a great negotiator on your side and Macdonald Realty has over 350 years of collective managerial experience for our agents to draw upon should a unique situation arise.Once the deal is accepted, a Macdonald Realty agent will work hard to resolve any issues which may come up before the deal goes firm. If, for any reason, a problem should arise, our agents have the backing of a full-service real estate company to support them. Many times, financing and tenancy issues can be resolved in-house. In instances where they cannot, your agent will be able to assist you in the renegotiation process to maximize your chances of the deal staying on track.
• (4) Completion Services
  • Once the deal is near completion, a Macdonald Realtor will work to ensure that all required legal documentation is transmitted to their respective legal and governmental bodies. Your agent will assist with solving last minute problems, and possession will be arranged. This is a stressful time and it’s important that all closing issues are dealt with efficiently to ensure a smooth transfer.
• (5) Post-Completion
  • Your Macdonald Realtor’s job is not over even though the deal has completed. They are still responsible for smoothing over any post-completion issues and being the primary communications conduit between the buyer and seller. In addition, they can be called upon to provide any advice with respect to settlement services, trades, and/or troubleshooting that may be required. Being a full-service professional, your Macdonald Realtor will have the answer for you, or know where to get it.

Macdonald Realty believes its model is the best way of protecting the interests of buyers and sellers. With our system, agents only get paid if a buyer and seller agree on the sale of a property. In other words, with Macdonald’s business philosophy, our agents are rewarded on performance.

Macdonald Realty and its agents invest hundreds of thousands of dollars every year in training, education, market research, program development and agent support to ensure we have the necessary skills to provide our clients with the best service in the industry. Our agents are effective negotiators, knowledgeable professionals, effective marketers, and educated advisors.

April 2011 Market Update

If you would like to learn more, please feel free to contact us by phone or by clicking on one of the links below:

Simon Clayton 604-764-0711

Jason Low 604-790-5276

Sandra Ens 604-263-1911

Jenny Stephanson 604-675-6214

Jason Feinstadt 604-263-1911

MacDonald Realty 604-263-1911

Here’s a market update from our friends at Macdonald Realty; Simon Clayton,  Jason Low, Sandra Ens, Jason Feinstadt, and Jenny Stephanson.

March 2011 Market Update

BC’s luxury market remained relatively strong throughout 2010. Surges were seen in the lower mainland, and bounce-back years happened in Victoria and the Okanagan. 2011 is forecast to remain relatively similar to last year, with the caveat being that the world’s economic recovery must continue, albeit slowly.

Greater Vancouver’s luxury home market broke all records in 2010. According to MLS stats, 375 homes sold for over $3 million, which breaks the record set in 2009 of 209, and doubles the number achieved in 2008 (167 sales), when the financial crisis led to a downturn in housing sales throughout the country.

Macdonald Realty Vancouver Manager, Matthew Lee, whose office sold the 3 most expensive homes in Greater Vancouver in 2009 and 2 of the 5 most expensive homes in 2010, believes that international buyers are fuelling the luxury market.”Buyers from Mainland China are pushing prices upwards,” Lee says,”but buyers from Europe and the US are willing to pay these prices as well. Globally, Vancouver is still seen as a relatively good bargain.”

Across the province, luxury sales also improved in lock-step with the global economic recovery. The one exception may be in the Okanagan, where sellers are now competing with product in the US. According to Don Gerein, Managing Broker for Macdonald Realty Kelowna,”Qualified buyers are taking advantage of the ability to shop from a diverse selection. Whether it’s waterfront or estate acreage, luxury buyers realize they can buy the property they have always wanted, but wasn’t available 2 years ago.”

In Victoria, where the luxury market bounced back in 2010, a similar year is expected.”Most of the action is between $1- to $3-million” says Macdonald Realty Victoria Manager Sandy Medler. That said, there are exceptions: the most expensive listing in Victoria right now is held by his office, at an impressive $19.25 million.

2010 Most Expensive Sales

Vancouver

• 1) $17,500,000
• 2) $11,080,000
• 3) $10,060,000

Fraser Valley

• 1) $6,120,000
• 2) $5,850,000
• 3) $5,300,000

Okanagan

• 1) $10,700,000
• 2) $5,998,000
• 3) $5,400,000

Victoria

• 1) $6,775,000
• 2) $5,550,000
• 3) $3,850,000

March 2011 Market Update

If you would like to learn more, please feel free to contact us by phone or by clicking on one of the links below:

Simon Clayton 604-764-0711

Jason Low 604-790-5276

Sandra Ens 604-263-1911

Jenny Stephanson 604-675-6214

Jason Feinstadt 604-263-1911

MacDonald Realty 604-263-1911

The Royal Bank of Canada joined TD Bank and CIBC in raising their rates for five-year closed mortgages.

The new posted rate of 5.44% jumped up by a 1/4 of a percentage point.

According to the Canadian Press

Finance Minister Jim Flaherty is warning of further increases in the months ahead.  “We’re likely to see higher interest rates as we go forward because interest rates are still very low,” Flaherty said.

Many of the other Finance Companies are sure to follow … so if you are considering a purchase or refinancing this spring, give us a call NOW and lock in a good rate. 604-736-1855

Here’s a market update from our friends at Macdonald Realty; Simon Clayton, Kristie Marsden, Jason Low, Sandra Ens, and Jenny Stephanson.

February 2011 Market Update

On January 17th, Finance Minister Jim Flaherty announced new federal rules on government-backed Canada Mortgage and Housing Corporation (CMHC) mortgages. The new rules will:

• 1) Reduce the maximum amortization period to 30 years from 35 years for government-backed insured mortgages with loan-to-value ratios of more than 80 per cent.
• 2) Limit the maximum amount homeowners can refinance their home to 85% from 90% of the value of their homes.
• 3) Remove government-backing of lines-of-credit secured by homes.

The impetus for such changes has come from experts such as Bank of Canada governor Mark Carney, who has warned that Canadian debt is reaching unsustainable levels. And even though BC’s housing market is more susceptible to these changes because of our relatively higher price-points, the changes outlined are targeted more at how Canadians consume debt rather than curbing the real estate market. The government isn’t trying to stop us from buying homes; they’re trying to stop us from using them as ATMs.

CMHC was founded after World War II to provide housing for returning soldiers. In the intervening years, its primary function has shifted towards providing mortgage insurance for individuals who wouldn’t otherwise have qualified to purchase a home. Most lenders are not allowed, by law, to lend more than 80% of the value of a home without insurance; CMHC provides that insurance to those lenders to offset the increased risk, allowing individuals to get a mortgage with as little as 5% down. These new rules target borrowers at the margin, or those who choose to extend themselves to the maximum extent.

With regards to the housing market, the only real dampening could come from the reduction in the maximum amortization period. According to BMO deputy chief economist Douglas Porter, this change will effectively reduce the maximum amount an individual could borrow by 7%. That said, very few borrowers max out the amount that they can borrow, meaning that its effect on the housing market will be limited. According to Benjamin Tal, deputy chief economist at CIBC World Markets, “the impact is insignificant.”

February 2011 Market Update

If you would like to learn more, please feel free to contact us by phone or by clicking on one of the links below:

Simon Clayton 604-764-0711

Kristie Marsden 778-836-4389

Jason Low 604-790-5276

Sandra Ens 604-263-1911

Jenny Stephanson 604-675-6214

Jason Feinstadt 604-263-1911

MacDonald Realty 604-263-1911