Archive for November, 2010

BC Home Sales Trend Higher

Vancouver, BC – November 15, 2010. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province declined 36 per cent to 5,507 units in October compared to the same month last year. On a seasonally adjusted basis, MLS® residential unit sales in the province increased 2 per cent in October from September 2010. The average MLS® residential price climbed 6 per cent to $521,859 in October compared to the same month last year.

“BC home sales have posted moderate gains since the summer months,” said Cameron Muir, BCREA Chief Economist. “Consumer demand was bolstered by double-dip in mortgage interest rates and the associated increase in purchasing power.”

Total active residential listings in the province have declined 18 per cent since June,” added Muir. “However, the housing market remains tilted in favour of homebuyers.”

Year-to-date, BC residential sales dollar volume declined 2 per cent $32.5 billion, compared to the same period last year. Residential unit sales declined 10 per cent to 64,735 year-to-date, while the average MLS® residential price climbed 9 per cent to $502,353 over the same period.

Fall Housing Forecast 2010, BCREA

Vancouver, BC – November 10, 2010. The British Columbia Real Estate Association (BCREA) released its Fall Housing Forecast 2010 today.

BC Multiple Listing Service® (MLS®) residential sales are forecast to decline 12 per cent from 85,028 units in 2009 to 74,950 units this year, before increasing 6 per cent to 79,700 units in 2011.

“Consumers are responding to a double-dip in mortgage interest rates,” said Cameron Muir, BCREA Chief Economist. “While housing demand waned in the province through the spring and summer, the added purchasing power from low borrowing costs combined with gradual improvement in the BC economy has trended home sales higher in recent
months.”

“A moderate increase in BC home sales is expected next year coinciding with employment and population growth,” added Muir. “However, the 79,700 unit sales that are forecast for 2011 are well below the ten-year average of 85,500 units.” A record 106,300 MLS® residential sales were recorded in 2005.

The average MLS® residential price is forecast to climb 7 per cent to $498,500 this year and remain relatively unchanged in 2011, albeit declining by 1 per cent to $495,600.

Is the time right for a re-finance?

By David Rees, TD Canada Trust

If you have already bought a home within the last 2 years, or if you have done a re-finance in the last 2 years, you may be in a position to potentially save tens of thousands of dollars. If you chose to go with a VARIABLE rate mortgage in the past 2 years, you are likely in a mortgage that has very little, if any, discount on it. In fact, you may even be in a Variable rate mortgage that is Prime PLUS a certain percent.

For example, about 1 ½ years ago, Variable rate mortgages were at Prime PLUS .80%. That would mean that today, your current Variable rate mortgage is 3.80% (Prime currently being 3%).

As the global economy began to turn around and borrowing flowed more readily, the discounts for Variable rate mortgages deepened and Prime MINUS mortgages came back into the market. Today, it’s possible to obtain a Variable rate mortgage at Prime MINUS .70% – that’s a full 1.5% difference compared to 1 ½ years ago!

What could this potentially mean in dollars? Well, on a mortgage of $300,000, based on Prime PLUS .80%, you would pay approximately $44,000 in interest over the next 4 years (assuming your mortgage funded 1 year ago, and thus, have 4 years left on a 5 year term).

On that same mortgage, based on today’s Variable rate of Prime MINUS .70%, you would pay approximately $28,000 in interest over the next 4 years. That’s a savings of $16,000 in interest. Additionally, not only would you be saving money every month in interest, but you would also lower your monthly payment.

While it’s true that there will likely be a penalty to get out of your existing mortgage, on a Variable interest rate mortgage, it is typically only a 3 month’s interest charge. So, again, using the example of a $300,000 mortgage, 3 months interest would be approximately $3000 – so you would still end up saving a significant amount of money.

If you are in a FIXED rate mortgage, you are likely to face a penalty called the ‘Interest Rate Differential’ which can be a considerable amount, in which case it may not be worth while to refinance. But, if you are in Variable rate mortgage, it would be very prudent to consider further investigating your options on re-financing and talk to your lender – it will be worth your while.

David Rees is a Mortgage Specialist with TD Canada Trust. He has been in the financial services industry since 2005. He specializes in all residential real-estate secured transactions, including new home (project site) purchases, re-sale home purchases, re-finances, equity take outs and investment properties. If you have any mortgage related questions, please feel free to contact David any time @ 778.217.0624 or david.rees@td.com

Home sales remain steady in Greater Vancouver

Vancouver, BC – November 2, 2010. Greater Vancouver home sales have remained steady over the past four months, indicating stability in the residential housing market. With the MLS® sales to active listing inventory ratio indicating a buyers’ market, properties appropriately priced are selling.

According to the MLSLink® Housing Price Index (HPI), the benchmark price for all residential properties in Greater Vancouver over the last 12 months has increased 4.6 per cent to $579,349 in October 2010 from $553,702 in October 2009. Since June, however, residential home prices in Greater Vancouver have remained relatively unchanged, declining 0.2 per cent.

“We’ve seen a lot more consistency and less volatility in recent months when it comes to both number of sales and pricing, although it’s important to remember that conditions often vary between communities and neighbourhoods,” Jake Moldowan, Real Estate Board of Greater Vancouver (REBGV) president said.

Looking at transactions, the number of residential property sales in Greater Vancouver totalled 2,337 in October 2010. This represents a 5.3 per cent increase compared to September 2010 and a 36.9 per cent decline from the 3,704 sales in October 2009.

More broadly, last month’s residential sales represent a 71.3 per cent increase over the 1,364 residential sales in October 2008, a 22.8 per cent decline compared to October 2007’s 3,028 sales, and a 14.1 per cent decline compared to the 2,722 sales in October 2006.

“As we enter the final two months of the year, buyer demand is in closer alignment with supply than we’ve seen for most of 2010,” Moldowan said. “Those buying today recognize that they still have a chance to enter the market with near-record low interest rates, while gradual reductions in inventory have eased downward pressure on prices.”

Total active listings on the Multiple Listing Service® (MLS®) in Greater Vancouver currently sit at 14,075, an 8.6 per cent decline from last month and a 16.4 per cent increase from October 2009. New listings for detached, attached and apartment properties declined 25.7 per cent to 3,698 in October 2010 compared to October 2009 when 4,977 new units were listed.

Sales of detached properties in October 2010 reached 976, a decrease of 34.4 per cent from the 1,487 detached sales recorded in October 2009, and a 98 per cent increase from the 493 units sold in October 2008. The benchmark price for detached properties increased 6.3 per cent from October 2009 to $796,883.

Sales of apartment properties reached 984 in October 2010, a decline of 38.8 per cent compared to the 1,607 sales in October 2009, and an increase of 52.1 per cent compared to the 647 sales in October 2008.The benchmark price of an apartment property increased 2.4 per cent from October 2009 to $390,074.

Attached property sales in October 2010 totalled 377, a decline of 38.2 per cent compared to the 610 sales in October 2009, and a 68.3 per cent increase from the 224 attached properties sold in October 2008. The benchmark price of an attached unit increased 4 per cent between October 2009 and 2010 to $487,530.