Market Update for January 2024:
Overall, 2023 was a slower year in the real estate market, but understandable, given that interest rates were the highest they’d been in over a decade.
Despite the higher interest rates, home prices went up an average of five percent last year across all market segments, according to the stats just released by the Real Estate Board of Greater Vancouver (REBGV).
There appears to be a great deal of pent-up buyer demand, if the number of calls and inquiries so far this year are any indication. Stable interest rates and a prediction that interest rates will very likely come down later this year are leading potential buyers to consider making that move now.
The mortgage brokers I know are still recommending a variable rate mortgage over locking in at current rates, and that’s likely a smart strategy for those interested in making a move in 2024, especially in the first half of the year.
High Buyer demand does one thing consistently… it drives home prices up. And waiting for interest rates to come down before making a purchase will very likely end up costing you more.
Below is an excerpt from the Globe and Mail, by Rob McLister, financial columnist. It was quoted in Mortgage Logic, a paid newsletter for mortgage brokers. (My thanks to Rebecca Awram of Axiom Mortgage Solutions for sharing this information.)
“Waiting too long for [BoC to ease rates] has a price. If buying late leads to paying 5% more on the average $646,134 Canadian home, for example, that costs $32,307. By contrast, paying a 100 bps (one percent) higher mortgage rate today is only $5,060 over one year on that same home value.”
Keep in mind the information above is based on Canadian house prices, and reflects a composite of condo, townhouse, and detached home pricing. Here in the Lower Mainland, we only wish that kind of pricing applied here!
For those who already own and are considering selling in 2024, there are sound reasons for listing your home early in the year, especially if you also need to re-purchase in this market.
I have strategies to accomplish both goals, so please give me a call if I can be of assistance.