It really has been quite a month, in terms of the economic doom and gloom, in world news and a wild ride for those investing in the Stock Markets.
This has continued to make everyone look long and hard at whether now is the time to buy Real Estate, or whether to wait and see if prices are going to fall further.
In my continuing quest to answer this question, I read the latest report on the Commercial Lending Indicator (CLI) written by BCREA, with interest as I feel it offers some clues. I published a full copy of the transcript on my Blog Post earlier this week which can be found at http://trishcenci.blogspot.com/2011/08/why-are-parts-of-bc-real-estate-market.html .
In summary, the CLI fell again this quarter, largely as a result of weak growth in retail sales and employment, and also weakened provincial manufacturing sales.
The state of employment growth is a big factor in whether the general public feel confident in going out and making major purchases such as a home, even though interest rates are not predicted to rise in the short term.
This coupled with the uncertainties of the US Economy, which has a major bearing on B.C. and Canada, has left consumer demand for Real Estate weak, particularly in the Central Okanagan.
Central Okanagan Real Estate Sales for August 2011
| Date | Total | S/F | Strata | Lot | Manuf |
| *Aug -11 | 276 | 145 | 103 | 17 | 11 |
| Jul -11 | 329 | 149 | 130 | 27 | 23 |
| Jun -11 | 331 | 200 | 90 | 20 | 21 |
| May -11 | 328 | 184 | 119 | 13 | 12 |
| Aug -10 | 269 | 129 | 107 | 15 | 18 |
*Figures are as at close of business 31st August 2011, and may be subject to slight change.
As you can see sales numbers have been quite disappointing this month. It is quite usual to see a dip in numbers during August, but Agent’s were reporting increased showing activity, so it is a surprise that numbers were quite this low as at the month end.If we compare the number of sales to the number of listings in each category, we also do not find any better news for Sellers – Single Family Home sales represented 6.5% of listings, of which 25% of total sales were over $550,000. Strata sales were around 6%, Lots 2% and Manufactured Homes 4.4%. It is still clearly a Buyer’s Market!
So what are my predictions for the coming months?
I believe that Buyers need to feel confident about their monthly disposable income , and this confidence has been bruised in recent months causing many to stay on the fence.
In reviewing the market results I am seeing some amazing deals coming together for those who have bought recently.
My advice is that if you see the property that is right for you buy it now, as even if the market does adjust a little more, I do not believe it will be significant.
The reality is that only a few people are ever lucky enough to buy at the very bottom of the market, and for those who will be borrowing it may never be a better time to lock into a fixed rate than now.
Kind Regards
Trish Cenci
Tel 250 864 1707
