THAT CRAZY MARKET!
A quick look at the chart on the right gives you a strong indication that the market is at a record level of activity. With a list to sell ratio of 68% it is higher than it was in the push of 2015-17 and higher than the push of 2005-07. This level of activity creates a very difficult market for the buyer as they struggle against multiple competitors to simply buy a home. On the other side of the deal, the seller is inundated with dozens of viewings each day as they move toward offer presentation day where they sift through many offers to find the one that is best.
Realtors® on both sides of the deal are working very hard to get the best for their client and trying to give sane advice in an insane market. When a listing gets 12 offers, the listing agent has a fixed set of protocols and documents to work through to ensure things are done properly. The Buyers and their agent know that if they don’t win, they’re back the following weekend to do it all over again on another property. 11 buyers and agents face this outcome. The stress is significant for all involved. Frankly, a balanced market is a much better market to work within for all involved.
The big question is how long will this last. This market will continue until supply increases or demand lessens. With sellers worried about being able to buy, there is reticence to listing first, so this shortens supply. New construction is held up as well because local governments are backlogged (due to Covid apparently?) and permits are taking much longer to obtain. There is also a shortage of developing land, again due to delays.
On the demand side, interest rates are at historic lows, though they are starting to rise in the last few weeks. Unemployment is not the concern it was last year and generally there is optimism. Then add in to the consideration that immigration has been curtailed this last year and only a portion of what we typically see in a year has actually come to the Lower Mainland. As Covid rules relax immigration will ramp up adding a bit more pressure on housing.
The next thing to happen is that prices reach a point where buyers cannot borrow any more and the number of offers decline. The Buyer then turns to a less expensive alternative and we will see the townhomes accelerate first and then the condo market will take off. This is already starting to happen with existing condo inventory selling off the market, again reducing inventory and pushing prices up.
Navigating all these issues, both on the selling side to maximize the eventual selling price, and for buyers working a strategy to get the best possible outcome in a multiple offer scenario, involves planning and experience. Frankly, that’s what I do and have done for many years. Knowledge of the Rules and Procedures combined with experience and success in all types of markets, that’s where I shine for you.