Dear clients and friends,
It is hard to predict anything in these uncertain times… I am sitting here thinking… whatever I write… can totally change again in a day or by next week! The main thing really for all of us is to stay safe and healthy. I know two parties that have lost friends to the COVID-19 and it is a tragedy.
Myself and my family are doing good, isolating like everybody else. My assistant Kim is working from home as I am, and as realtors, we can’t do Open Houses anymore and are encouraged not to go out to the public. Only when absolutely necessary, we show homes with a mask and gloves so all parties are protected, Sellers and Buyers. A health questionnaire is filled out to make sure the risk of infection is hopefully kept at a minimum.
I have seen a surge in Investment homes being listed, as Sellers would like to get their monies out, especially since you can not evict a tenant. A terrible loss for homeowners carrying big mortgages. The uncertainty of the stock market being so volatile does not help. Stocks respond to fear and greed. But let’s talk real estate and I will go into point form so reading is a bit easier:
- New residential listings jumped 45% compared to last month’s, yet down 6% from this time last year.
- Average days on the market increased to 88 days, almost 3 months to sell a home, this varies a bit depending on home type and region.
- My online traffic for my listings has significantly increased, telling me, lots of people are at home looking at listings online. An indication, once we are recovering, the market should be really good.
- This past week, we also saw Interest Rates drop as the Bank of Canada performed their 3rd rate cut in just 3 weeks. What does that mean for you? If you are in a variable rate mortgage, you will most likely see the savings passed on as lenders drop their prime rates to match the Bank of Canada's latest rate cut. For fixed rate mortgages, it's always advised to check in with your mortgage broker as there have been cases where even fixed rates have seen a decrease over the past several weeks.
- Rules have changed for tenants and landlords. The provincial government announced that stating April 1 there will be a 3-month $500 rent subsidy available for tenants. There is also a current freeze on any evictions and a freeze on annual rent increases until further notice.
- In its most recent analysis, the BCREA predicts a steep decline in home sales in the second quarter, followed by a slow recovery. Sales are not expected to reach pre-COVID-19 baseline expectations by the end of 2020. Housing prices, on the other hand, will likely experience only a modest temporary decline and should recover to baseline over the next year.
- Prices are staying stable so far, apartments and building lots saw a price drop so far. The main reason home prices are expected to remain steady despite COVID-19 is that there isn’t a large enough supply for people to take advantage of low prices. It works both ways. If people aren’t out there buying right now, they’re not planning to list either.
- What usually drives real estate prices down is a drop-in sales activity coupled with a large increase in inventory. People aren’t likely to be trying to get out of the real estate market at this time, so there is unlikely to be an increase in inventory. Even if demand falls off more than expected, it will take some time for that to be evident in real estate prices.
- A slowdown in sales could also lead to pent up housing demand. This means once COVID-19 has settled down, the housing market could come roaring back.
- Vancouver prices are still holding, but Toronto saw a drop in prices for the first time in two years.
As we have never experienced a COVID-19 ever before, we really don’t know, will the world slide into a recession, or is this just a temporal situation and our lives will return to normal in a few months? Nobody really knows.
I am still listing homes, which is a good sign and also have 2 pending offers at the moment. Fingers crossed it won’t come to a total stand still in our market.
Stay safe (seems to be in every email) caring is up more! And maybe we just need to see how lucky and grateful we are and to never loose hope, as hope brings back love, peace and faith.
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Annette Denk - serving Kelowna – Lake Country - Vernon – Silver Star
Move Okanagan – Real Estate That Will Move You
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Quote of the day: Don't wait for the 'perfect time' - you will wait forever. Always take advantage of the time that you're given.