The effects of the pandemic have simmered down a bit and talk about a V-shaped recovery of Canada’s economy are doing the rounds. Economists have come to a consensus that the worse economic impacts of the pandemic are long over and that we will be back on our feet, at least economically in a few months’ time, God willing.
While that may be music to the ears, another exciting development that is dominating Canada’s news outlets of late is the explosive volume of real estate transactions that have erupted from Canada’s property markets. Vancouver is one of those markets that have been abuzz with property transactions of late.
Vancouver property market on fire
As the pandemic restrictions eased out in early June, Vancouver’s property market turned around and things started looking up. The Real Estate Board of Greater Vancouver (REBGV) reported that sales activity in June surged 64.51%, up from 35.8% in May.
While that may be a good sign of real estate recovery, July recorded a phenomenal performance which experts say have exceeded historical levels.
Sales were 22.3% higher than July 2019 and 28% over the number sold in June. For the record, July’s performance of Vancouver was 9.4% higher than the 10-year July sales average. The question that arises here- will Vancouver be able to hold on to this rare streak of success?
Housing has become a priority
The Vancouver market has attained stability with the unlocking of the economy. The unmet demand of the spring market has had a lot of buyers and sellers thronging the property market to buy a good piece of real estate.
Given the economic stability of Vancouver and one of the highest population growth rates in the country, housing prices have seen an uptick which bodes well for the property market.
Properties listed on the market are staying for 17 days only, which is quite encouraging. It means that people are looking at real estate as a safe investment, looking at the benefits it possesses over the long term.
The rock-bottom interest rates have also spurred homebuyers to look at real estate as a priority investment. And looking at how the pandemic is going; one can be at least sure that these low home loan rates would stay for another 12 or 18 months.
Change in priorities of homebuyers
While the significant volume of real estate transactions in Vancouver may bring cheer on the faces of real estate dealers, much of the transactions have happened due to a change in the mindset of homebuyers, with regards to the facilities they are looking for.
Homebuyers are looking for spacious homes with bigger surroundings to cut the exhaustion of staying in small homes. Demand for properties with personal safety bubbles like wider porches, lobbies, and sitting areas have been noted by real estate agents.
With most people having to work from home, upgrading from a one-bedroom condo to a two-bedroom condo with extra space for hosting an office station is on the cards of many homebuyers.
While it is not clear when the pandemic will subside, homebuyers wary of social distancing measures have tuned into virtual property sites to buy homes.
To cater to the expectations of homebuyers, designers of residential houses and condominiums are coming up with new tweaks in the interior topographies of homes, to provide homebuyers with fresh air and sunlight wherever it is necessary.
Rental market suffers contraction
The pandemic has thinned immigration of people into Canada’s cities; and with international travel restrictions still alive and kicking, the rental market of Vancouver has taken a backseat.
Though Vancouver is a popular tourist city with spectacular sights, and also a thriving business center, with the current restrictions, there are fewer buyers of condominiums looking to rent them out for passive income. Also, with schools and colleges shut at present, renters of such units have vanished. This has pushed down prices of condos considerably. Investors who have bought condos earlier looking at short-term rentals are now listing them on the market amidst declining demand.
Going by the current trends, homeownership in Vancouver looks like a sound and prudent decision. Low-interest rates, good chances of capital appreciation, and a rock-solid market fundamental will give Vancouver’s property market the impetus it requires to gain confidence. Given the economic difficulties the world is facing of late, one can expect real estate prices to undergo correction in the coming months, until the spending power of people stabilizes. All in all, Vancouver is poised for a great comeback.