January 2021 began the second year of a global pandemic with a continuation of December’s record-setting home sales pace across the Lower Mainland. Greater Vancouver transactions increased 52.1 per cent in January and Fraser Valley residential sales soared 76 per cent, year-over-year. But the January acceleration was more than catching a tail wind from 2020.
I believe it is a realization that right now the stars have aligned for a historical, unprecedented opportunity in Canada’s leading residential real estate market.
These “stars” include the lowest mortgage rates we have seen in our lifetime, heck even in our parent’s lifetime. The five-year fixed rate mortgages rate has fallen to an average of 1.84 per cent. And Canada’s central banker has confirmed plans to keep the “overnight rate” – what it charges to big banks and other large lenders – at 0.25 per cent, likely for at least two years. Yet Metro Vancouver home prices are rising 5 per cent to 10 per cent annually.
Another star is that real estate technology is at such an advanced state that, despite the restrictions on social distancing due to the pandemic, the listing, viewing, buying, selling and all the closing documents of a transaction are as quick and seamless today as during the pre-pandemic. Faith Wilson Group was a pioneer and early adopter of this technology and I am delighted that it is so helpful for our clients today.
A third star is that many homeowners now have substantial savings, since travel and social spending are off the table during the pandemic, and they subsequently also have time to concentrate on what is really important in life, such as a nice home.
The shining star is potential. British Columbia’s economy has weathered the pandemic better than any other province. When the brakes come off travel, Metro Vancouver will be the destination of choice for new immigrants and home buyers from across Canada.
Industry projections are that home sales will rise another 21 per cent this year compared to 2020 in Greater Vancouver, with prices up a further 9 per cent. The Fraser Valley is forecast to see a 16 per cent sales increase, with prices up 9 per cent rise in prices in 2021.
Metro Vancouver home buyers and sellers, the most astute real estate consumers in Canada, have naturally recognized what is happening and are taking full advantage.
The stars have indeed aligned and the sky’s the limit.
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