With almost half of 2009 under our belts and a strong surge locally during May, we are seeing a healthier and more confident market emerging on the North Shore.
Last month’s interest rate discussion was a call to action to many who had been sitting on the sidelines and rewarded those who obtained financing pre-approvals and rate guarantees. So, announcements by the majority of lenders (banks, credit unions and trust companies) in the early days of June that all were increasing their mortgage interest rates - anything from 0.15% to 0.35% depending on the “lock in” term involved - had no negative effect on them. Further gradual increases may come over the next few weeks, so, if you have not obtained a “rate guarantee”, do so – remember, it costs nothing other than your time and does not commit you to having to draw down any mortgage. I would call it “free insurance”.
I believe that the most significant occurrence in the past few months (notably during May) is the shrinking of supply (i.e. inventory) of homes for sale. Simple refresher – if demand stays healthy (or grows) and supply diminishes – prices will increase. We are seeing some of that with a steady rise in the average prices. For example the YTD average prices for detached properties in N/Van show this trend in the last few months of 2009 –
Feb $749k; Mar $773k; Apr $825k and May $824k. Yes, I will grant that certainly, fewer units are selling than this time last year but they are changing hands at an increasing price level. Prediction: this summer will be relatively more active (sales wise) than the average summer. We are seeing a number of examples of the unsuccessful seller of mid to latter ’08 re-listing this year and meeting with success.
Again, visit my website to see and “hear” the new developments. Continue my commitment to keep you... www.OnTopOfTheMarket.ca - the “go to” site for North Shore Real Estate analysis and jumping off point for FULL market listing information.
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Alan
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