Who’s Buying Houses Right Now In Metro Vancouver?
Recently the Real Estate Board of Greater Vancouver published data characterizing evolving trends in the Vancouver real estate market. The data was collected by sampling 160 Realtors active within the region to garner their professional opinions on market trends. Here are some perhaps surprising take-aways from that report:
1. First-Time Homebuyers. First-time homebuyers accounted for roughly one-third of all purchases in the first half of 2014. This figure is pretty much exactly in-line with purchaser trends for the region over the last five years, which typically fluctuates between about 25-50%. While there were no hard figures published on the mean age of these first time buyers, it would be curious to see if there has been an upward trend over the past decade. Anecdotal evidence would suggest that ever-rising prices in our local market has delayed many new entrants from taking the plunge and entering the real estate market.
2. Downsizers. Almost 8% of home purchasers in June reported moving from a detached home to a townhome. There has been a noticeable trend over the last few years of more and more downsizers moving from detached residences to townhomes and condominiums. It’s postulated that this activity is largely driven by empty nesters, who in their retirement years no longer feel the need to hold on to their homes until the bitter end. Rather, increasingly, the data would suggest that mature Canadians are looking to gradually scale back their homes to something more manageable as they move in to their retirement years and beyond.
3. All cash purchases. Over the course of the last few years there has been a trend toward fewer home purchases involving high-ratio mortgages (<25% downpayment) and a general increase in “all cash” home purchases in the Vancouver area. While the reasons behind this are likely complex, these trends can at least be partially attributed to ever-tightening mortgage lending rules. In general, these rules are felt to have put increasing pressure on parties with lower declared incomes, including first-time homebuyers, the self-employed, and some newer immigrants.
4. Overall consumer behaviour. As is typically indicative of a warming housing market, Realtors involved in this survey have identified increased open house traffic, increased bidding war activity, and decreased numbers of collapsed deals over the last several months.
With all these factors in mind, the Vancouver housing market appears poised for a solid conclusion to 2014.
If you have questions about the market or would like to discuss anything mentioned in this article, feel free to send me an email or drop me a line—I’d love to chat. I’m a Vancouver Realtor who is an expert in residential real estate and sell extensively condominiums, townhomes and detached homes.