Spring is officially here, days are longer and a hint of Summer's warmth is in the air...but perhaps for brief periods, third Winter will reappear. This time of year is also typically the busiest when it comes to real estate. This edition of the newsletter takes a broader look to start before narrowing in on Squamish specifically and onto the latest pre-sale news. Happy Spring!
Greater Vancouver and Squamish Real Estate Market
We are in a balanced market where neither buyers nor sellers have 'the upper hand' and price movement appears to be fairly stable. It has taken almost a full year to reach this point. New benchmark prices are set after the rapid rise in market values between the Summer of 2020 and the Spring of 2022. The peak of the market was in the Spring of last year with overall activity and prices dropping since. The bottom of the market appears to be close if not realized already. It is important to note that these peaks and valleys are only confirmed in hindsight a few months after they have happened.

We have seen interest rate hikes drop off and indications are that rates will be steady over the next year or so and perhaps start to decline at some point in 2024. A mortgage broker is best suited to provide you with details here and find the specific mortgage product that is the best fit for your individual situation.

Projected interest rate stability coupled with a decrease in market values appears to have spurred activity in the market as real estate is more affordable. For example, a purchase today is more affordable in terms of monthly mortgage as well as closing costs than a purchase in Spring '22.
UPDATE: Recent US Bank failures add to the complexity of interest rate projections but most professionals working in the mortgage space believe this news furthers the likelihood of interest rate stability or even decreases by year-end.

Supply is low and demand is picking up. At the start of the Spring market, the number of listings typically rises by about 30% and to date in 2023 we are at about a third of the historical average. Typically, there is a multiple-month delay between what I see as a realtor day to day and the sold statistics provided by the real estate board. There is also a disconnect between what I am seeing and hearing from fellow professionals in the industry day to day and what the media is reporting. There is a lot of click-bait out there and attention-grabbing headlines...
What I started seeing this past Fall and into today is an increase in activity overall; more inquiries, phone calls, emails, listing appointments, showing requests etc. This ramp-up typically happens over at least a couple of months ultimately this leads to offers being made and properties selling.

The increase in activity I believe is not likely to shift us into a strong seller's market with prices rising as they did in recent memory but rather a fairly balanced market with more sales taking place. Ultimately, it comes down to supply vs demand and if we do not see more listings come on the market expect a fairly competitive marketplace this Spring in comparison to the last three quarters of 2022.

A closer look at SQUAMISH...

Sales to Active Listings ratio (SAR) - a measure of supply and demand, is a key statistic used to determine which way the market is trending. After seeing values reset for most of 2022 we have indications over the last few months that there may be upward pressure on prices for condos and townhomes where detached homes remain in a balanced market. The potential upward pressure is a combination of buyers beginning to act after waiting on the sidelines for most of last year and sellers not willing or needing to list their homes for sale after seeing price corrections in the last year. There are not many new listings coming onto the market and although the number of sales is lower than average the supply vs demand indicators are indicating upward pressure on prices. Over the first three weeks in March, there are 50 new listings and 32 sales total in Squamish. The takeaway here is although the market is slower the low amount of inventory is keeping the door open for a seller's market overall. It is important to zoom in on specific segments of the market one is interested in.

In Squamish, the February SAR is as follows. For more details on Squamish statistics - click here
  • Condos 32%
  • Townhomes 30.4%
  • Detached 13.5%
Balanced markets generally occur when the sales-to-active listings ratio is between 12 to 20 percent, Buyers’ markets typically occur when the ratio dips below the 12 percent mark, while Sellers’ markets tend to occur when it surpasses 20 percent for sustained periods.

To summarize; 

Due to restricted supply desirable properties that are realistically priced are selling quickly after being listed while properties that have more considerations and, or are reaching for past highs in pricing will sit on the market and not sell. Buyers are becoming more active spurred by confidence in affordability compared to most of the past year. The gap between detached home and townhome prices has reduced and, to a similar albeit lesser extent, the condo-to-townhome gap has closed as well. If you are considering moving up the property ladder it may be the time to discuss your options and strategize with your realtor.

Sellers need to be realistic about the changed marketplace. New benchmarks have been set. Only recent sales should be used as comparable properties to determine current market values and the property down the street that sold in April of 2022 is almost certainly not a useful data point.  

Sellers should have an open conversation with their Realtor about their objectives and together the best strategy based on their individual circumstances can be made to achieve a property owner's goals.

A strong marketing plan and the first impression a buyer gets about a property are vital in achieving a successful sale but in this current market, I cannot stress enough how vital an accurate list price is. A seller in today's market needs to be seen as realistic and attract as many potential buyers as possible. Taking a calculated approach when selling a property is essential, real estate is one of if not the biggest financial assets you will have, so choosing the right 'partner' to sell your property is important. Sellers should be comfortable with their listing realtor being able to openly communicate with them and together create realistic expectations. As a local Squamish real estate agent I view my role as an advisor and the client as the decision maker, additionally, I view our relationship as a partnership in coming up with the best strategy based on one's individual and unique circumstances. As a listing agent ultimately sell their property for the highest price within their desired period of time.

Buyers seemingly have the luxury of being patient and waiting for the right property but must be prepared to act when the time is right.

Many Buyers who have been on the sidelines are now ready to act. We are not in a buyer's market but a balanced one and it is important to be ready to act on an opportunity.

Being prepared starts with knowing your financials and putting in the time to research the market. On the financial side speak with a mortgage advisor to get pre-qualified, have an interest rate hold in place and most importantly have a solid understanding of your monthly budget from vacation funds and investment savings to your mortgage payment and subsidiary housing costs (strata fees/home maintenance funds, utilities, property taxes, etc). On the market research side of things your realtor is the advisor here; understanding what neighbourhoods or complexes will be of interest to strata history and zoning knowledge your real estate advisor should be a local expert in the area you are looking to purchase in. When you have isolated the neighbourhoods or buildings of interest you will be ready when the right opportunity presents itself so an offer can be made and negotiations come from a position of strength.

Posted by Admin SQUAMISH.com on
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