In the first month of 2021, Metro Vancouver’s housing market continued the pattern set at the end of last year with home sale activity outpacing the supply of homes listed for sale.
The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,389 in January 2021, a 52.1% increase from the 1,571 sales recorded in January 2020, and a 22.8% decrease from the 3,093 homes sold in December 2020.
Last month’s sales were 36.4% above the 10-year January sales average. “With home sale activity well above our January average, the supply of homes for sale isn’t able to keep pace,” Colette Gerber, REBGV Chair said. “This is causing increased competition amongst home buyers and upward pressure on prices.”
There were 4,480 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in January 2021. This represents a 15.7% increase compared to the 3,872 homes listed in January 2020 and an 86% increase compared to December 2020 when 2,409 homes were listed.
The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 8,306, a 3.6% decrease compared to January 2020 (8,617) and a 2.7% decrease compared to December 2020 (8,538).
For all property types, the sales-to-active listings ratio for January 2021 is 28.8%. By property type, the ratio is 26.3% for detached homes, 37.6% for townhomes, and 27.8% for apartments.
Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12% for a sustained period, while home prices often experience upward pressure when it surpasses 20% over several months.
“Shifting housing needs during the pandemic and historically low-interest rates have been key drivers of demand in our market over the last six months,” Gerber said. “People who managed to enter the market a few years ago, and have seen their home values increase, are now looking to move up in the market to accommodate their changing needs.”
The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,056,600. This represents a 5.5% increase compared to January 2020 and a 0.9% increase compared to December 2020.
Sales of detached homes in January 2021 reached 740, a 68.6% increase from the 439 detached sales recorded in January 2020. The benchmark price of a detached home is $1,576,800. This represents a 10.8% increase from January 2020 and a 1.4% increase compared to December 2020.
Sales of apartment homes reached 1,195 in January 2021, a 46.8% increase compared to the 814 sales in January 2020. The benchmark price of an apartment home is $680,800. This represents a 2.2% increase from January 2020 and a 0.6% increase compared to December 2020.
Attached home sales in January 2021 totalled 454, a 42.8% increase compared to the 318 sales in January 2020. The benchmark price of an attached home is $815,800. This represents a 4.3% increase from January 2020 and a 0.2% increase compared to December 2020.
We’ve all spent a lot more time at home over the past year. And for many of us, our homes have become our office, our classroom, our gym—and most importantly, our safe haven during times of uncertainty. So it’s no surprise to see that design trends for 2021 revolve around soothing colour palettes, cozy character, and quiet retreats.
Even if you don’t have immediate plans to buy or sell your home, we advise our clients to be mindful of modern design preferences when planning a remodel or even redecorating. Over-personalized or unpopular renovations could lower your property’s value. And selecting out-of-style fixtures and finishes could cause your home to feel dated quickly.
To help inspire your design projects this year, we’ve rounded up five of the hottest trends. Keep in mind, not all of these will work well in every house. If you plan to buy, list, or renovate your property, give us a call. We can help you realize your vision and maximize the impact of your investment
Colours are gravitating toward warm and happy shades that convey a sense of coziness, comfort, and wellbeing. This year’s palettes draw from earthy hues, warm neutrals, and soothing blues and greens.
While white and gray are still safe options, expect to see alternative neutrals become increasingly popular choices for walls, cabinets, and furnishings in 2021.
On the opposite end of the spectrum, indigo, ruby, sapphire and plum are showing up on everything from fireplace mantels and floating shelves to fabrics and home accessories. These classic, rich hues can help bring warmth, depth, and a touch of luxury to your living space.
To incorporate these colours, designers recommend using the “60-30-10 Rule.” Basically, choose a dominant colour to cover 60% of your room. For example, your walls, rugs, and sofa might all be varying shades of beige or gray. Then layer in a secondary colour for 30% of the room. This might include draperies and accent furniture. Finally, select an accent colour for 10% of your room, which can be showcased through artwork and accessories.
2. Curated Collections
After a decade of minimalism, there’s been a shift towards highly-decorative and personalized interiors that incorporate more colour, texture, and character. Clearly-defined styles (e.g., mid-century modern, industrial, modern farmhouse) are being replaced by a curated look, with furnishings, fixtures, and accessories that appear to have been collected over time.
This trend has extended to the kitchen, where atmosphere has become as important as functionality. The ubiquitous all-white kitchen is fading in popularity as homeowners opt for unique touches that help individualize their space. If you’re planning a kitchen remodel, consider mixing in other neutrals—like gray, black, and light wood—for a more custom, pieced-together look. And instead of a subway tile backsplash, check out zellige tile (i.e., handmade, square Moroccan tiles) for a modern alternative with old-world flair.
3. Reimagined Living Spaces
The pandemic forced many of us to rethink our home design. From multipurpose rooms to converted closets to backyard cottages, we’ve had to find creative ways to manage virtual meetings and school. And designers expect these changes to impact the way we live and work for years to come.
For example, some home builders are predicting the end of open-concept floor plans as we know them. Instead, buyers are searching for cozier spaces with more separation and privacy. Cue the return of walls and, in some cases, alcoves and sliding partitions that enable homeowners to section off rooms as needed.
The necessity of a home office space is also here to stay. But what if you don’t have a dedicated room? Alternative workspaces have become increasingly popular. In fact, one of the biggest trends on Pinterest this year is the “cloffice”—essentially a spare closet turned home office. Searches for “home library design” and “bookshelf room divider” are on the rise, as well.
4. Staycation-Worthy Retreats
With travel options limited right now, more homeowners are turning their vacation budgets into staycation budgets. Essentially, recreate the resort experience at home—and enjoy it 365 days a year!
Bedrooms should provide a soothing sanctuary for rest and relaxation. But this year, minimalist decor and muted colours are giving way to bolder statement pieces. To create a “boutique hotel” look in your own bedroom, start with a large, upholstered headboard in a rich colour or pattern. Layer on organic linen bedding and a chunky wool throw, then complete the look with a pair of matching bedside wall lights.
Carry those vacation-vibes into your bathroom with some of the top luxury upgrades for 2021. Try a large, zero-entry shower for two, a floating vanity with hand-free faucets, or a radiant-heated floor for the ultimate spa-like experience.
5. Outdoor Upgrades
From exercise to gardening to safer options for entertaining, the pandemic has led homeowners to utilize their outdoor spaces more than ever. In fact, backyard swimming pool sales skyrocketed in 2020, with many installers reporting unprecedented demand. But a new pool isn’t the only way homeowners can elevate their outdoor area this year.
Composite decks have become a favourite upgrade for their low-maintenance and durability. And in 2021, creative design elements are on the rise, including unique inlays, wider planks, and multiple deck board colours. Add stair or bistro lights for a touch of ambiance while enhancing safety and visibility.
DESIGNED TO SELL
Are you contemplating a remodel? Want to find out how upgrades could impact the value of your home? Buyer preferences vary greatly by neighbourhood and price range. We can share our insights and offer tips on how to maximize the return on your investment. And if you’re in the market to sell, we can run a Comparative Market Analysis on your home to find out how it compares to others in the area. Contact us to schedule a free consultation!
Circumstances like a once-in-a-hundred-years pandemic and historic inventory shortages might have made you assume that the housing market would lose steam, but there is plenty of evidence to the contrary. As Canadian Real Estate Association (CREA) senior economist, Shaun Cathcart noted, “records are continually being broken” in the residential property market.
Indeed, rather than a slowdown, we are continuing to experience a surprisingly robust real estate market across the country. And experts estimate that these conditions are likely to last into the new year.
Market conditions like fewer available listings, changing criteria for desired homes, and record-low mortgage rates are changing the way people buy and sell homes, most likely in a lasting way. But this sustained activity proves Canadians still view real estate as a sound investment. The only question now is how you can take advantage of the housing market’s “new normal.” In this article, we’ll explain everything you need to know to achieve your goals.
FEWER LISTINGS EQUALS A SELLER’S’ MARKET
Inventory, meaning the number of homes for sale, is at a record low across the country.
According to statistics from RBC Economics, the majority of Canada is experiencing tighter demand versus supply conditions than the country has seen in nearly two decades. Fewer listings create a housing market that is advantageous for sellers for several reasons. For one, buyers have to act fast to snap up available homes. The median number of days listings now spend on the market is 26 days.
Another benefit is that sellers are enjoying higher net returns on their listings. This is thanks to the tough competition for homes, which often results in bidding wars between buyers.
This sellers’ market is not simply a product of the pandemic. In fact, Cathcart cited the steady decline in home inventory over the past five years—not COVID-19—as the cause for higher prices. “Heading towards records and record type conditions was something that we had already expected,” he said. This means that even if construction was to ramp back up, buyers can’t simply wait for things to go back to normal before reentering the market. Rather, all signs indicate that this is the new normal.
What It Means for Homeowners:
These higher home prices show that buyers are willing to spend more on a home right now than they did last year. So, if there ever were a time to list for top dollar—and expect to receive asking price quickly—that time is now. Ask us for a free consultation of your home’s value today.
What It Means for Homebuyers:
Due to low inventory, buyers could easily find themselves in a bidding war. Time is of the essence in a seller’s market, so you’ll need to get your financing in order and be preapproved for a loan before you begin your home search. We can connect you with a trusted mortgage professional to get you started.
BUYERS BENEFIT FROM LOW MORTGAGE RATES AND A BIGGER PLAYING FIELD
Don’t worry, homebuyers. This “new normal” of real estate has benefits for you too.
For example, people used to base their next home purchase on how far the commute was to work or in which public school district it was. But now, thanks to the pandemic shifting the focus of jobs and work, they are free to consider what they need from a home to make it a place they really want to work, teach, exercise, cook, and live.
Often, this equates to needing more space in different types of areas. The search for these criteria is driving residents out of densely populated metropolitan areas and into the suburbs. And this exodus from cities is good news for buyers: it opens up more possibilities for inventory that they could not have considered pre-pandemic.
Another advantage for buyers is the record-low mortgage rates. The average five-year fixed rate fell to a record low of 1.39%, down from 3.04% at the end of 2019 and 3.74% at the end of 2018.
Thanks to these rates, buyers are afforded the opportunity to buy much more home than they could before. Consider this example. If a buyer can afford a $500,000 home by putting $120,000 down (25%), the monthly payment on a standard 25-year mortgage would be $2,210. Conversely, with a lower rate (say, 2.8%) that buyer can now afford a $600,000 home—$100,000 more purchasing power—at a cost of only $12 additional per month.
The good news is that interest rates are not expected to rise anytime soon—and may hover at these record lows until 2023.
What It Means for Homeowners:
If you’re locked into a higher fixed-rate mortgage for the next several years, you’re probably wondering if it’s a good idea to refinance. With those additional funds, you could even choose to invest in a second home in a new desirable location. Reach out to us for a referral to a trusted mortgage professional or an agent in those markets.
What It Means for Homebuyers:
The time is now to determine how much home you can comfortably afford and make a plan to find it. We can set up a search for you to find homes that best meet your new needs, even if they’re in neighborhoods you wouldn’t have considered before.
A RECORD-SETTING YEAR FOR HOME SALESIS JUST THE BEGINNING
Part of the reason for these continued sales is that the pandemic has created a paradigm shift in the patterns of real estate. For example, housing needs are typically resolved by late summer and early fall to coincide with the commencement of the new school year. With homeschooling and remote work, however, buyers have been freed to continue their home search into the traditionally slow winter months.
Another reason for the robust market is that household savings grew to 28.2% of household income during the pandemic, an extraordinary level that Statistics Canada said the country has not seen since the 1960s. Canadians who were able to keep their jobs, as well as those on unemployment, have evidently made growing their savings a priority. And it seems as though Canadian homebuyers are using that cash on real estate.
So though it looks different than it ever has before, it’s clear that consumers consider real estate to still be a good investment. The coming months should provide more clues about the market’s direction in the year ahead, such as whether low interest rates and changing housing needs can keep demand levels high, or whether the exhaustion of pent-up demand will cool things off.
What It Means for Homeowners:
It’s tempting to believe that homes will basically sell themselves in a market like this. But we’re still seeing properties that are overpriced and under-marketed sit unsold. We can help you optimize the process of selling your home so you can get the best possible offer.
What It Means for Homebuyers:
Preparation is key to success in a sellers’ market like this, but don’t let yourself become paralyzed. We are here to answer your questions and offer sound advice to guide you through all the options that are available to you.
WE’RE HERE TO GUIDE YOU
National real estate numbers can give us a pulse on the market, but real estate happens in our own backyard. As your local market experts, we can help you understand the finer points of the market that impact sales and home values in your own neighbourhood.
If you’re considering buying or selling a home contact us now to schedule a free consultation. We’ll work with you to develop an actionable plan to meet your goals.
From summer vacations to winter holidays, it seems each season offers the perfect excuse to put off our to-do list. But be careful, homeowners: neglecting your home’s maintenance could put your personal safety—and one of your largest financial investments—at serious risk.
