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State of the Market: Real Estate in Whistler BC
Hello! This is Stef. Let’s dive deep into the ever-evolving world of real estate, specifically the State of the Market: Real Estate in Whistler BC, and BC’s Sea to Sky Corridor. Today’s State of the Market is current as of September 1st, 2023.
Navigating the Real Estate Market: Riding the Waves of BC’s Sea to Sky Corridor
The Big Question: “How’s the market?” Well, let’s put it this way: it’s like asking, “How’s the weather?” It all depends on where you’re standing.
Your Position in the Market
Whether you’re a buyer, a seller, or just curious, the state of the market depends on your unique circumstances. Did you jump into the property pool in 2021, or perhaps even earlier? Or did you purchase in 2022? Before or after the interest rate hikes? Are you currently on a variable rate mortgage or did you lock in? What types of properties interest you? Tourist accommodation properties in Whistler trade differently than residential which trade differently than luxury. The pulse of the market varies depending on these factors.
Crunching the Numbers
Now, for a splash of data: According to the Housing Price Index, Whistler Property values have seen an 11% increase since their recent low point last December. But, remember, they’re still 8% shy of the height of the market we experienced in June 2022.
What’s the takeaway?
If you purchased property in 2021, most likely, you’ve regained that value lost in the 2022 Q3 and Q4 dip. Remember, real estate is a marathon, not a sprint. It’s a long term hold.
Pre-2021 buyers have also likely seen an increase in the value of their properties! And for those who locked in with attractive interest rates, well, it’s almost like the market laid out a red carpet just for you. That’s called really good luck.
Those who purchased during the 2022 peak, on a variable mortgage, may have to weather this storm for a bit, but once again, real estate is a long term hold. There are a couple of reasons to look on the bright side if you’re in this group: Values are steadily rebounding. Hopefully we are seeing a light at the end of the mortgage rate increase tunnel.
Foreclosure Fears? Here’s Why We Don’t Expect Foreclosures to Impact the Market
- Canada’s stress test is our financial umbrella. Most people who purchased in the last year qualified at rates higher than what we’re seeing right now. Others who purchased pre-2021 have enough equity in their homes where they may have options. Even with rates climbing, those hit by lower-than-purchase price values and rising rates form only a tiny market segment.
- High rental rates coupled with a robust job market mean most folks have an escape hatch to sidestep foreclosure.
- We’re back to January 2022 values, which means that people who purchased in 2021 or before have likely recovered their value, and hopefully have paid off enough of their principle so that they are not underwater. Re-financing may be an option for those who need it. Talk to your mortgage broker.
We don’t expect a deluge of properties flooding the market. Any market movement due to the small foreclosure market will likely be offset by those with locked-in low rates. They aren’t moving right now unless they can port their mortgages. This is actually contributing to the low inventory challenge that we are seeing right now. These property owners might decide to sell as their mortgage terms come up, but we’re looking at a gradual flow over the next couple of years, not a torrent.
Supply and Demand: The Eternal Tango
Canada’s housing narrative still revolves around one word: shortage. With building and development taking a backseat recently due to escalating interest rates, there’s simply not enough property supply to send prices down. Rental rates continue to rise – this also puts upward pressure on the prices of homes.
The Crystal Ball: Predictions and Projections
Short-term: If the Bank of Canada plays it cool and doesn’t hike rates this September, we could witness a mini buying upswing reminiscent of March & April this year. The numbers came out this morning: Canadian GDP was down slightly in Q2. Building and renovations are down due to the higher cost of borrowing. This puts pressure on the Bank of Canada to maintain their rates for now. This is a bit of relief for Canadian homeowners and homebuyers this fall. We’ll see what the BoC does next week.
Long-term: Expect modest price growth and a mild uptick in the number of sales relative to the past year.
The Bank of Canada’s attempts to rein in housing inflation by cranking up interest rates are ironically contributing to the spike in housing costs. It’s a bit of a conundrum, especially for first-time buyers seeking a piece of the property pie. (That is, the BoC’s efforts are pinching out the wrong end of the market). They will have to change tactics to curb housing inflation and put properties in the hands of regular Canadians – they need different medicine for this problem as supply shortages have maintained pressure on prices.
A Friendly Piece of Advice
With inventory levels still hovering on the low side, properties with the right price tag are still getting snapped up in multi-offer scenarios. Certain categories of properties for which it is more difficult or costly to obtain financing, and properties that have missed the pricing mark tend to stay on the market longer. Whether you’re buying or selling, aligning with a REALTOR® who understands how to price correctly in this market is the way to go. All of the agents in our office are well-versed in market dynamics, and they are pricing experts. We discuss this daily. We are continually honing our pricing techniques. Reach out anytime. We’re always up for a chat about property pricing.
Final Thoughts
Whether it’s deciding when to sell or scouting for a dream home, understanding market nuances is crucial. Text ‘state’ to 604-373-0834 to discuss your specific scenario.
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