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March Real Estate Update

Posted by Annette Denk on Monday, March 16th, 2020 at 2:03pm.

Will the coronavirus affect our housing market?

There is no denying the impact the coronavirus is having on the global economy in the world. It is scary to see the stock market crash so much! The virus has halted production and caused major interruptions to the supply chain and economic volatility, and it could lead to an estimated $2.7 trillion in lost global output, according to Bloomberg Economics. Usually with a stock market crash, comes a slow down in real estate.

On the other side, if the challenge persists over a more extended period, Canadian housing markets are likely to become even more attractive to investors who would like to move their capital from markets with ominous health risks to the relatively safe environment. Investors might want to move their money into hard assets, like real estate, especially to Canada, as we at this point have not suffered as much from the spread of the disease.

On a positive note, our real estate market in the Okanagan is doing remarkably well. It really picked up as Vancouver got busier as well.

Number of Sales compared to last year are up 16.4%, Median home price is up 6.5%. Sales of properties below $440,000 declined but all price ranges above that rose quite a bit.

Our February total active listings also reflected the increase in sales with less inventory then we saw in February 2019.

It looks, so far, like we are heading into a positive busy spring market.

Strata insurance rates are increasing and why:

They are increasing for a variety of reasons. These include an increase in the number of claims, in the cost of repairs and rebuilding, and in the growing number of strata developments. Many strata buildings date back to the 1970s and ’80s and strata owners may be reluctant to undertake major system upgrades until problems occur.

In BC we are facing insurance rate increases of between 50 and 300 per cent this year, according to the Condominium Home Owners Association of BC. Deductibles to cover claims are also rising. In some cases, we’ve heard of deductibles increasing as much as $500,000.

Remember that insurance doesn’t cover claims under the deductible amount. So, for example, if a plumbing incident were to cause $75,000 in water damage to a strata owner’s unit, and the strata’s deductible was $100,000 then insurance wouldn’t cover the claim. In such a scenario, the owner could have to pay for the damages out of pocket, depending on the strata’s bylaws.

Make sure you have: a unit owner’s insurance policy; have a policy that covers the higher deductible (insurance deductible insurance) and to cover a loss in your unit; and understand the risk of not having enough coverage.

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Annette Denk  - serving Kelowna – Lake Country - Vernon – Silver Star

Move Okanagan – Real Estate That Will Move You

Quote of the day: Quote of the day: Don't be afraid to give up the good to go for the great.

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