Here is the summary from a report from Gregory Klump, the Canadian Real Estate Association's chief economist, that was released today, May 26, 2010.
• Canadian home prices are unlikely to undergo U.S.-style correction.
• As part of a normal demand-driven housing market cycle, the price to income ratio reverts from its peak to its long-term average by way of income growth and stable prices.
• Homes purchased by retirees with accumulated wealth, not financed with income, may be upwardly skewing the British Columbia and national price to income ratio.
• Based on the longer-term relationship between price and income, the national price to income ratio will soon revert to its long-term average via increases in income, not sharp price declines.
• Warnings of a U.S.-style correction in Canadian home prices ignore solid Canadian mortgage market trends.
• Mortgage holders in Canada have borrowed conservatively and are accelerating mortgage repayment, providing options for the small proportion of homeowners that may face financial difficulty when their mortgage is renewed at a higher interest rate.
• Canada will avoid a massive oversupply of homes and a sharp drop in housing demand, so a U.S.-style correction in home prices is unlikely.
The information in this blog has been taken from a report provided by CREA and may not be appropriate for other purposes. The information contained in this report has been drawn from sources believed to be reliable, but is not guaranteed to be accurate or complete. The report contains economic analysis and views, including those on future economic and financial markets’ performance. These are based on certain assumptions, and other factors, and are subject to inherent risks and uncertainties. The actual outcome may be materially different. Cyndi Polovina, Landmark Realty Mission Ltd., CREA and its member Boards and Associations are not liable for any errors or omissions in the information, analysis or views contained in this report, or for any loss or damage suffered
Wednesday, May 26, 2010
Wednesday, May 5, 2010
Active Spring Market in the Fraser Valley
It is not uncommon for us to see a surge of listings in the Spring, but this year's number of active listings in April, in the Fraser Valley, was second only to the April of 1995. There is a huge volume of listings available from which Buyers can choose their dream home, which is definitely affecting home values.
As with anything from widgets to oranges, with higher supplies and lower demand come lower prices. Fortunately the demand in the Valley remains high, and this is keeping prices stable. Prices remain rather unchanged, over the last few months, although year-over-year, we have seen a rise in prices of about 10% in most areas in the Fraser Valley, across most housing types.
Before I start giving you benchmark statistics to show you how prices have changed in the past year in various areas of the Fraser Valley, I need to explain the "HPI benchmark home" briefly. The HPI (Housing Price Index) is akin to the CPI (consumer price index.) In order to compare apples to apples, so to speak, a "benchmark" home is defined in an area, as being indicative of an average home that is sold in a given area. In the Fraser Valley a "typical" or benchmark single-detached home is 15 years old with a lot size of 7405 sqft, nine rooms, two bathrooms, a fireplace and a one-car garage. The idea is that if we measure how the "typical" home has changed in price, we can know how prices in all segments of the market have changed in price. It also enables us to compare prices in Langley with prices in Mission, since we are comparing the same kind of home, but in a different area.
While the Fraser Valley as a whole saw the HPI rise 13% year-over-year, April 2009 to April 2010, in Mission, the rebound from the price declines of 2008 and 2009 hasn't been as quick or significant. The price of a benchmark home in Mission only rose about 2.3% year-over-year, compared to an increase of a benchmark Abbotsford home from about $395,000 to about $442,000, or almost 12%!
When you compare benchmark pricing of $354,307 in Mission to a benchmark Surrey Central home at $533,000, or a benchmark Langley home at $523,000, you can see that there is clear value in buying into the beautiful communities of Abbotsford and Mission.
With prices in Mission still being depressed compared to other areas, there is great value in buying a home in Mission, which is only about an hour's ride from Downtown Vancouver by the comfortable and affordable West Coast Express train. Mission is a fantastic, family community with many amenities and services. I am proud to call Mission home, and I would welcome the opportunity to show interested buyers why they should consider purchasing a home here, or in our neighbour city, Abbotsford.
As an area expert, and professional Realtor, I can advise you about area amenities and also advise you about what pitfalls to look out for whether you are buying your first home, retirement home, or your dream home. I look forward to helping you make you home buying experience a positive one!
As with anything from widgets to oranges, with higher supplies and lower demand come lower prices. Fortunately the demand in the Valley remains high, and this is keeping prices stable. Prices remain rather unchanged, over the last few months, although year-over-year, we have seen a rise in prices of about 10% in most areas in the Fraser Valley, across most housing types.
Before I start giving you benchmark statistics to show you how prices have changed in the past year in various areas of the Fraser Valley, I need to explain the "HPI benchmark home" briefly. The HPI (Housing Price Index) is akin to the CPI (consumer price index.) In order to compare apples to apples, so to speak, a "benchmark" home is defined in an area, as being indicative of an average home that is sold in a given area. In the Fraser Valley a "typical" or benchmark single-detached home is 15 years old with a lot size of 7405 sqft, nine rooms, two bathrooms, a fireplace and a one-car garage. The idea is that if we measure how the "typical" home has changed in price, we can know how prices in all segments of the market have changed in price. It also enables us to compare prices in Langley with prices in Mission, since we are comparing the same kind of home, but in a different area.
While the Fraser Valley as a whole saw the HPI rise 13% year-over-year, April 2009 to April 2010, in Mission, the rebound from the price declines of 2008 and 2009 hasn't been as quick or significant. The price of a benchmark home in Mission only rose about 2.3% year-over-year, compared to an increase of a benchmark Abbotsford home from about $395,000 to about $442,000, or almost 12%!
When you compare benchmark pricing of $354,307 in Mission to a benchmark Surrey Central home at $533,000, or a benchmark Langley home at $523,000, you can see that there is clear value in buying into the beautiful communities of Abbotsford and Mission.
With prices in Mission still being depressed compared to other areas, there is great value in buying a home in Mission, which is only about an hour's ride from Downtown Vancouver by the comfortable and affordable West Coast Express train. Mission is a fantastic, family community with many amenities and services. I am proud to call Mission home, and I would welcome the opportunity to show interested buyers why they should consider purchasing a home here, or in our neighbour city, Abbotsford.
As an area expert, and professional Realtor, I can advise you about area amenities and also advise you about what pitfalls to look out for whether you are buying your first home, retirement home, or your dream home. I look forward to helping you make you home buying experience a positive one!
Monday, January 18, 2010
The Dreaded HST and the Housing Market
What is the proposed HST going to do to the housing market? Even more worrisome is the forecast that interest rates are likely to rise around the same time as the HST kicks in. Low interest rates have boosted affordability and the combination of low interest rates and relatively lower housing prices have drawn first-time buyers into the market in droves. In fact, where first-time buyers would have made up approximately 25% of December sales, they actually accounted for 40% of December 2009 sales.
The proposed HST (Harmonized Sales Tax) will combine the PST and GST. Some items which were previously PST exempt will now carry HST, meaning a whopping 7% increase in taxes on those items. In recent years, purchases of building lots have only carried GST, not PST, but, if the tax comes into effect July 1, as expected, HST will apply, increasing the cost by 7%.
New home sales have also only carried GST, with some rebates allowed if the home was to be owner-occupied. That is also the case with the proposed HST. HST will apply on new homes where the Buyer takes ownership or possession on or after July 1, 2010. There will be some exemptions and threshold limits that may mean rebates of the tax for some home buyers.
Local Real Estate Boards did have some success in lobbying the government for increased thresholds for the proposed tax. It appears that the maximum threshold for rebates on HST will be raised from $400,000 to $525,000; Over $525,000, everyone will receive a rebate of $26,250, (71.43 of the provincial portion of the HST), if the home is going to be owner-occupied.
So, what does this mean for the real estate market? In Mission, the impact on prices and activity should be less severe than in more urban areas, since a large portion of our new homes being sold are below the threshold of $525,000. Independent of any interest rate hikes, which have a lowering effect on prices, due to decreased affordability, the newly-imposed HST could potentially have the impact of increasing prices to some degree, albeit not likely by as much as 7%. The problem is, what will that do to market activity?
The HST doesn't only affect new homes, since activity in one market segment affects activity in other market segments. Regardless of whether your home is the kind of home that first-time buyers are purchasing, or if your home is more in the second-home range, there are always “trickle down” effects of activity. For example, a person selling their home to trade-up for a newer one may not be able to afford a new build, but maybe you can. Perhaps your home is exactly the one that someone would want to trade up to, even if it is no longer meeting your family's space requirements. Perhaps this is the year to make that move you have been considering, to get into a brand-new home before the HST kicks in? (Particularly if you are thinking about buying a new home worth more than $525,000.)
The greatest likelihood is that the looming HST will mean that the number of sales will decrease after May 1, 2010, as many people will make sure their completion dates fall before July 1 to avoid the HST. I am expecting a very busy spring market, with lots of sales. But the likelihood is that the summer and fall months will experience fewer sales than we have experienced in recent months. And, don't forget that a drop in demand usually means a drop in prices, so waiting too long could cost you money.
With my skills, knowledge and area expertise, I can help you to use the right strategies that work to get your Mission home sold. Call me to help you make the most important decision of your life an INFORMED decision. Call Cyndi Polovina today at_604-820-7733!
The proposed HST (Harmonized Sales Tax) will combine the PST and GST. Some items which were previously PST exempt will now carry HST, meaning a whopping 7% increase in taxes on those items. In recent years, purchases of building lots have only carried GST, not PST, but, if the tax comes into effect July 1, as expected, HST will apply, increasing the cost by 7%.
New home sales have also only carried GST, with some rebates allowed if the home was to be owner-occupied. That is also the case with the proposed HST. HST will apply on new homes where the Buyer takes ownership or possession on or after July 1, 2010. There will be some exemptions and threshold limits that may mean rebates of the tax for some home buyers.
Local Real Estate Boards did have some success in lobbying the government for increased thresholds for the proposed tax. It appears that the maximum threshold for rebates on HST will be raised from $400,000 to $525,000; Over $525,000, everyone will receive a rebate of $26,250, (71.43 of the provincial portion of the HST), if the home is going to be owner-occupied.
So, what does this mean for the real estate market? In Mission, the impact on prices and activity should be less severe than in more urban areas, since a large portion of our new homes being sold are below the threshold of $525,000. Independent of any interest rate hikes, which have a lowering effect on prices, due to decreased affordability, the newly-imposed HST could potentially have the impact of increasing prices to some degree, albeit not likely by as much as 7%. The problem is, what will that do to market activity?
The HST doesn't only affect new homes, since activity in one market segment affects activity in other market segments. Regardless of whether your home is the kind of home that first-time buyers are purchasing, or if your home is more in the second-home range, there are always “trickle down” effects of activity. For example, a person selling their home to trade-up for a newer one may not be able to afford a new build, but maybe you can. Perhaps your home is exactly the one that someone would want to trade up to, even if it is no longer meeting your family's space requirements. Perhaps this is the year to make that move you have been considering, to get into a brand-new home before the HST kicks in? (Particularly if you are thinking about buying a new home worth more than $525,000.)
The greatest likelihood is that the looming HST will mean that the number of sales will decrease after May 1, 2010, as many people will make sure their completion dates fall before July 1 to avoid the HST. I am expecting a very busy spring market, with lots of sales. But the likelihood is that the summer and fall months will experience fewer sales than we have experienced in recent months. And, don't forget that a drop in demand usually means a drop in prices, so waiting too long could cost you money.
With my skills, knowledge and area expertise, I can help you to use the right strategies that work to get your Mission home sold. Call me to help you make the most important decision of your life an INFORMED decision. Call Cyndi Polovina today at_604-820-7733!
Tuesday, October 13, 2009
15th Annual Realtors Care Blanket Drive
Are you treating yourself to a new sweater or coat this fall? Consider donating your gently used one(s) to a worthy cause.
The 15th Annual Realtors Care blanket drive is coming up from November 30th to December 7th. All donations received in a community are given to charities within that community to distribute to low-income families and individuals, and to the homeless.
As you can imagine, with the economy having suffered so much, there are more working poor than ever who could use a helping hand. Your donation of warm, waterproof winter clothing, warm, dry socks, scarves and gloves will go a long way to help those in need.
Put a smile on the face of a struggling member of your community, and let them know that people do care. Donations will gladly be accepted at most Real estate offices during the week of November 30 - December 7th. Lists of drop off locations will be posted around your community starting in early November. Have a happy, healthy fall!
The 15th Annual Realtors Care blanket drive is coming up from November 30th to December 7th. All donations received in a community are given to charities within that community to distribute to low-income families and individuals, and to the homeless.
As you can imagine, with the economy having suffered so much, there are more working poor than ever who could use a helping hand. Your donation of warm, waterproof winter clothing, warm, dry socks, scarves and gloves will go a long way to help those in need.
Put a smile on the face of a struggling member of your community, and let them know that people do care. Donations will gladly be accepted at most Real estate offices during the week of November 30 - December 7th. Lists of drop off locations will be posted around your community starting in early November. Have a happy, healthy fall!
Thursday, September 3, 2009
Tips to Keep in Mind Between Your Mortgage Approval and Funding Dates
In light of the new market realities and tightening of credit underwriting standards by both lenders and mortgage default insurers as of late, keep in mind that now – more than ever – it’s important to be careful what you do between the time your mortgage is approved and when it funds.
A few mortgage lenders and insurers have been doing something lately that they have not done in a long time – pulling new credit bureaus prior to funding, especially if there is a long period between the time of your approval and when the mortgage actually funds.
Following are eight tips to keep in mind between your mortgage approval and funding dates:
1. Don’t buy a new car or trade-up to a more expensive lease.
2. Don’t quit your job or change jobs. Even if it’s a better-paying job, you still are likely to be on a probationary period. If in doubt, give me a call and I can let you know if this may jeopardize your approval.
3. Don’t change industries, decide to become self-employed or accept a contract position even if it’s within the same industry. Delay the start of your new job, self-employment or contract status until after the funding date of your mortgage.
4. Don’t transfer large sums of money between bank accounts. Lenders get especially skittish about this one because it looks like you’re borrowing money. Be ready to document cash transactions or money movements.
5. Don’t forget to pay your bills, even ones that you’re disputing. This can be a real deal-breaker. If the lender pulls your credit bureau prior to closing and sees a collection or a delinquent account, the best you can hope for is that they make you pay off the account before they will fund. You don’t want to have to scramble to pay off a debt at the last minute!
6. Don’t open new credit cards. Again, just wait until after your funding date.
7. Don’t accept a cash gift without properly documenting it – even if this is from proceeds of a wedding. If you have a bunch of cash to deposit before your funding date, give me a call before you deposit it.
8. Don’t buy furniture on the “Do not pay for XX years plan” until after funding. Even though you don’t have to pay now, it will still be reported on your credit bureau, and will become an issue – especially if your approval was tight to begin with.
While you may not risk losing your mortgage approval because you have broken one of these rules, it’s always best to talk to me before doing any of the above just to make sure
A few mortgage lenders and insurers have been doing something lately that they have not done in a long time – pulling new credit bureaus prior to funding, especially if there is a long period between the time of your approval and when the mortgage actually funds.
Following are eight tips to keep in mind between your mortgage approval and funding dates:
1. Don’t buy a new car or trade-up to a more expensive lease.
2. Don’t quit your job or change jobs. Even if it’s a better-paying job, you still are likely to be on a probationary period. If in doubt, give me a call and I can let you know if this may jeopardize your approval.
3. Don’t change industries, decide to become self-employed or accept a contract position even if it’s within the same industry. Delay the start of your new job, self-employment or contract status until after the funding date of your mortgage.
4. Don’t transfer large sums of money between bank accounts. Lenders get especially skittish about this one because it looks like you’re borrowing money. Be ready to document cash transactions or money movements.
5. Don’t forget to pay your bills, even ones that you’re disputing. This can be a real deal-breaker. If the lender pulls your credit bureau prior to closing and sees a collection or a delinquent account, the best you can hope for is that they make you pay off the account before they will fund. You don’t want to have to scramble to pay off a debt at the last minute!
6. Don’t open new credit cards. Again, just wait until after your funding date.
7. Don’t accept a cash gift without properly documenting it – even if this is from proceeds of a wedding. If you have a bunch of cash to deposit before your funding date, give me a call before you deposit it.
8. Don’t buy furniture on the “Do not pay for XX years plan” until after funding. Even though you don’t have to pay now, it will still be reported on your credit bureau, and will become an issue – especially if your approval was tight to begin with.
While you may not risk losing your mortgage approval because you have broken one of these rules, it’s always best to talk to me before doing any of the above just to make sure
Tuesday, August 4, 2009
The Right Specialist Gets the Job Done Right
Would you hire an electrician to do your plumbing? How about using a veterinarian to perform your own open heart surgery? Or maybe you should just do it all yourself to save money? Not a good idea. Realtors know Real Estate. And you need a Mission Realtor to market your Mission area home, to ensure you maximize your proceeds of sale.
In the Fraser Valley and Greater Vancouver area there are very distinct market trends from one area to the next. As you can see in the graph above, there are times when the average price in Mission is increasing, even as the average price in Abbotsford is decreasing, even though they are just across the bridge from each other.
Just as the recession has affected the Ontario economy more than the BC economy, market changes in one area of the Fraser Valley can be quite different than in other areas.
A Mission area specialist is in hundreds of Mission homes each month, researches values on Mission homes each day, and has experience listing and selling homes just like yours, in your area, your neighbourhood, or even on your very street.
Don't take a chance and hire the wrong person for the job. Hire your Mission area specialist, Cyndi Polovina to make sure that your home sale is a successful one!
Thursday, April 9, 2009
Our Shifting Market: Help is Needed
In a shifting market, such as we are in now, it is more important than ever that people who are considering the purchase or sale of real estate are represented by a skilled, knowledgeable Realtor who will represent their best interests.
Realtors are not merely salespeople for houses. More is needed than a knowledge of your home's value, and an ad in the paper, in order to sell your home. Many people do not realize that Realtors are trained professionals and are members of professional organizations with strict codes of ethics and guidelines on professional standards that must be maintained. There are also continuing education requirements and regular legal updates that are important to maintaining the best possible service to our clients. That is something in which I take pride. Personally, I am a member of the Fraser Valley Real Estate Board, the BCREA, and CREA. I take my obligations and agent duties to heart, and I represent my clients as I would wish to be represented if I were in their shoes.
In a market such as we are in now, which is rapidly changing, it is more important than ever to have someone looking out for your best interests. A skilled Realtor will ensure that you are protected on many levels.
One is of course to ensure that you are getting good value on your sale or purchase. Correct pricing is critical for sellers so that money is not left on the table, and it is vital to ensure that the home is priced considering market trends. That balance is very delicate, and a skilled professional can best advise you. A Realtor can also advise you of minor repairs or improvements that should be completed before listing your home. Often these minor items will pay for themselves (and then some!) Some Realtors, such as myself, may also be able to help you to stage your home to both get you the best value and sell more quickly than homes which are not staged.
As a buyer, the most important thing in a declining market is to choose a home with lasting value for you and your family. A good Realtor has knowledge of what features in homes hold value, and can also give skilled, objective advice to help you make a choice that will ensure the lasting value of your investment.
It is always the right time for certain people to buy or sell real estate. The question is whether or not now is the right time for YOU. A Realtor can help you to weigh all your options and give an objective view on the current market and on your home's value.
Furthermore, Realtors protect their clients on paper, by way of the contract, so that details such as included items and deposit monies are accounted for. If there is to be a long time before completion, or the contract is subject to the sale of the buyers' home, in a shifting market, more than ever, the Realtor must ensure their clients' interests are protected.
I would be honoured to take on the duty of representing you in your purchase or sale of real estate. Please contact me at your convenience.
Realtors are not merely salespeople for houses. More is needed than a knowledge of your home's value, and an ad in the paper, in order to sell your home. Many people do not realize that Realtors are trained professionals and are members of professional organizations with strict codes of ethics and guidelines on professional standards that must be maintained. There are also continuing education requirements and regular legal updates that are important to maintaining the best possible service to our clients. That is something in which I take pride. Personally, I am a member of the Fraser Valley Real Estate Board, the BCREA, and CREA. I take my obligations and agent duties to heart, and I represent my clients as I would wish to be represented if I were in their shoes.
In a market such as we are in now, which is rapidly changing, it is more important than ever to have someone looking out for your best interests. A skilled Realtor will ensure that you are protected on many levels.
One is of course to ensure that you are getting good value on your sale or purchase. Correct pricing is critical for sellers so that money is not left on the table, and it is vital to ensure that the home is priced considering market trends. That balance is very delicate, and a skilled professional can best advise you. A Realtor can also advise you of minor repairs or improvements that should be completed before listing your home. Often these minor items will pay for themselves (and then some!) Some Realtors, such as myself, may also be able to help you to stage your home to both get you the best value and sell more quickly than homes which are not staged.
As a buyer, the most important thing in a declining market is to choose a home with lasting value for you and your family. A good Realtor has knowledge of what features in homes hold value, and can also give skilled, objective advice to help you make a choice that will ensure the lasting value of your investment.
It is always the right time for certain people to buy or sell real estate. The question is whether or not now is the right time for YOU. A Realtor can help you to weigh all your options and give an objective view on the current market and on your home's value.
Furthermore, Realtors protect their clients on paper, by way of the contract, so that details such as included items and deposit monies are accounted for. If there is to be a long time before completion, or the contract is subject to the sale of the buyers' home, in a shifting market, more than ever, the Realtor must ensure their clients' interests are protected.
I would be honoured to take on the duty of representing you in your purchase or sale of real estate. Please contact me at your convenience.
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