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Tuesday, October 2, 2018

Fraser Valley Real Estate September Statistics

Housing supply ample as buyers remain hesitant in September


SURREY, BC – The slowing of sales activity and expansion of overall inventory that has defined much of 2018 for the Fraser Valley housing market continued in September, with sales at their lowest point and inventory at its highest for the year.


The Fraser Valley Real Estate Board processed 1,035 sales of all property types on its Multiple Listing Service® (MLS®) in September, a decrease of 36.1 per cent compared to the 1,619 sales in September of last year, and a 10.4 per cent decrease compared to sales in August 2018.

Of those 1,035 sales, 376 were residential detached homes, 250 were townhouses, and 274 were apartments. This was the lowest number of transactions in a month this year for each category.

“Buyers remain reluctant as the market continues to adjust,” said John Barbisan, President of the Board. “We’re seeing good things happening in terms of inventory, but it only opens the door so much while prices are moving at a much slower rate.”

Active inventory for the Fraser Valley in September finished at 7,647 listings, increasing 4.2 per cent month-over-month and 30.6 per cent year-over-year. This is the highest level of supply for the Fraser Valley since July 2015.

A total of 2,946 new listings were received by the Board in September, a 14.4 per cent increase from that received in August 2018, and a 3.4 per cent increase compared to September 2017’s intake.

“If you want to sell soon, the most important thing you can do to be successful is to price effectively. Talk to your REALTOR® who can help you understand what buyers are looking for in your local market.”


For the Fraser Valley region, the average number of days to sell an apartment in September was 33, and 32 for townhomes. Single-family detached homes remained on the market for an average of 39 days before selling.


HPI® Benchmark Price Activity

• Single Family Detached: At $988,900, the Benchmark price for a single-family detached home in the Fraser Valley decreased 2 per cent compared to August 2018 and increased 1.1 per cent compared to September 2017.

• Townhomes: At $546,100, the Benchmark price for a townhome in the Fraser Valley in the Fraser Valley decreased 0.4 per cent compared to August 2018 and increased 9.5 per cent compared to September 2017.

• Apartments: At $438,700, the Benchmark price for apartments/condos in the Fraser Valley decreased 1 per cent compared to August 2018 and increased 22.5 per cent compared to September 2017.


For the full statistics package please visit: http://www.fvreb.bc.ca/statistics/Package201809.pdf


Gelderman.ca Real Estate Team
RE/MAX Aldercenter Realty


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Monday, September 10, 2018

Ontario and B.C. Generation Z are more alike when it comes to home ownership than we think

Ontario and B.C. Generation Z are more alike when it comes to home ownership than we think



Generation Z, ages 18 to 24, in Canada’s hottest housing markets share their views on home ownership and foreshadow the future of real estate

With real estate continuing to be a hot topic, what do near-future homebuyers in Canada’s hottest markets have to say? A new RE/MAX survey conducted by Leger found that nearly 51 per cent of Generation Z (age 18-24) in the Greater Vancouver Area would like to own a home in the next few years, while those in Toronto are more inclined to continue to rent or live with their parents.

Key findings:

  • 67 per cent of Generation Z in Ontario and British Columbia are stressed when thinking about purchasing a home. In the Greater Toronto Area and Greater Vancouver area this is higher at 75 per cent in the GTA and 71 per cent in the GVA
  • 46 per cent of Generation Z in Ontario and British Columbia who don’t own a home, would like to buy one in the next few years
Generation Z is expected to outnumber Millennials within a year and as such, this generation will have a significant impact on the housing market over the next 20 years. With the mounting cost of home ownership in Ontario and British Columbia it is no surprise that 38 per cent of respondents expressed no desire to own a home. However, the survey also found that about half of both Gen Z groups in B.C. (50 per cent) and Ontario (45 per cent) agree they have limited knowledge of the housing market but are interested in learning more. This was especially apparent in each of the province’s hottest housing markets, with 57 per cent in the Greater Vancouver Area (GVA) and 51 per cent in the Greater Toronto Area (GTA) feeling undereducated.
“Gen Zers are interested in learning more, and a greater effort needs to be made to educate them about the benefits and potential risks of home ownership,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “As Gen Z looks ahead, it’s important that they have a trusted team and good resources to turn to, to alleviate stress and empower them in the process to becoming first-time homebuyers in the future. While the survey showed interesting trends across two of the hottest markets, the Gen Zers we speak to are eager to become informed and excited about the future of home ownership.”
The survey also found that 46 per cent of respondents who don’t currently own a home, would like to in the next few years. In the GTA and GVA this rate is 42 per cent and 51 per cent, respectively. Despite their future home-buying plans, 67 per cent of Gen Zers in Ontario and British Columbia are stressed when thinking about purchasing a home.
“While the prospects of home ownership may seem daunting, that doesn’t mean that Generation Z should give up hope,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX INTEGRA Ontario-Atlantic Region. “It will be more important than ever for financial institutions and real estate professionals to educate this generation and reach them through the platforms they frequent, such as social media and online.”
Despite the anxiety felt by many Gen Zers toward the prospect of home ownership, more education and help from the right team of professionals could dispel the fears and assist them in making a sound investment. It is expected that this generation will have a big impact on the Canadian real estate market in the next two decades. Gen Zers and other young homebuyers are adapting to current market conditions by looking outside of city centres to find affordable properties. Government must also play a role in ensuring that these suburban communities are well connected to urban centres, so that this cohort doesn’t become isolated..

Additional Findings from the 2018 Generation Z Leger Survey

  • The survey also found that location (56 per cent) and safety (27 per cent) matter the most to Generation Z in Ontario and British Columbia when thinking about purchasing their first home.
  • When it comes to preferred methods of down payments:
    • 72 per cent said they would use savings/RRSPs
    • o9 per cent said they would take out a loan
    • 29 per cent said they would get help from family
    • 10 per cent said they would use inheritance
  • According to Generation Zers in Ontario and British Columbia who do not currently own a home, but would like to the top reasons to purchase a home include:
    • 63 per cent think it’s a good plan for the future
    • 25 per cent thinks it’s a good investment
    • 3 per cent are against renting
    • 8 per cent feel it is something they should do
Check out this publication: The next big disruptor: Gen Z







Gelderman.ca Real Estate Team
RE/MAX Aldercenter Realty


Know someone moving ANYWHERE in the WORLD? Call me today--I know the BEST agents everywhere!!

Serving Abbotsford, Chilliwack, Mission, Langley, Surrey and the WORLD!


Office: 604-743-7653





All Courtesy of : blog.remax.xa



Wednesday, September 5, 2018

Fraser Valley Real Estate AUGUST Statistics



Fraser Valley sees further decline in activity in August

SURREY, BC – Market activity declined further in August with sales dropping to their lowest level this year.
The Fraser Valley Real Estate Board processed 1,155 sales of all property types on its Multiple Listing Service® (MLS®) in August, a decrease of 38.5 per cent compared to the 1,879 sales in August of last year, and a 10.5 per cent decrease compared to the 1,290 sales in July 2018.
Sales of attached homes continued to represent over fifty per cent of all activity in the Fraser Valley this month, with 294 townhouses and 318 apartments selling in August.
“With demand slowing down and prices staying put, both buyers and sellers can expect to see an easing of competition with less multiple offer situations,” said John Barbisan, President of the Board. “Right now, effective pricing is key and will be the determining factor for a successful transaction.”
Active inventory for the Fraser Valley in July finished at 7,339 listings, decreasing 0.8 per cent month-over-month and increasing 28.5 per cent year-over-year.
2,575 new listings were received by the Board in August, an 11.8 per cent decrease from July 2018’s 2,921 new listings, and a 2.2 per cent decrease compared to August 2017’s intake.
“Our market continues to open up the further we get into the year, and that means you can make more considered, informed decisions if you’re looking to jump in,” continued Barbisan. “The best first step you can take is talking to a local REALTOR® who can help you determine your options and a plan forward.”
For the Fraser Valley region, the average number of days to sell an apartment and a townhome in August was 27. Single family detached homes remained on the market for an average of 35 days before selling.
HPI® Benchmark Price Activity
  • Single Family Detached: At $1,008,700, the Benchmark price for a single family detached home in the Fraser Valley decreased 0.9 per cent compared to July 2018 and increased 2.9 per cent compared to August 2017.
  • Townhomes: At $548,300 the Benchmark price for a townhome in the Fraser Valley in the Fraser Valley decreased 1.7 per cent compared to July 2018 and increased 11.5 per cent compared to August 2017.
  • Apartments: At $443,200, the Benchmark price for apartments/condos in the Fraser Valley decreased 1.6 per cent compared to July 2018 and increased 26.9 per cent compared to August 2017.

Find the FULL August Statistics Package here.












Gelderman.ca Real Estate Team
RE/MAX Aldercenter Realty

Visit our web site here: www.gelderman.ca


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OFFICE: 604-743-7653


Data courtesy of: FVREB

Monday, August 13, 2018

Getting a Foot in the Door: Overcoming the challenges faced by first-time homebuyers

Getting a Foot in the Door: Overcoming the challenges faced by first-time homebuyers



Due to a perfect storm of significant housing price appreciation, tight rental conditions, stagnant wage growth and stricter mortgage regulations, prospective first-time home buyers are facing multiple challenges in their attempts to save a down payment and qualify for a mortgage.
In fact, according the 2016 census, nearly 40% of those aged 20-35 in the Vancouver area still live with their parents. While the reasons for this large cohort are myriad, the single greatest challenge faced by this group is overcoming the incredibly high barriers to home ownership.
“We are seeing people who are older and have opted to rent longer,” says Troy Resvick, President of the Canadian Mortgage Brokers Association – British Columbia (CMBA – BC) “We’re also seeing the other side of that, where family is assisting them to get into the market.”
“With most detached houses in Langley priced above $750,000, finding a home that first-time buyers can afford is a daunting task,” says Resvick. “Either adjust your expectations significantly, or let’s talk to the Bank of Mom and Dad.”
Resvick is referring to the increasing trend of parents digging into their savings or securing reverse mortgages in order to gift a down payment to their children.

‘Stressful’ tests

Amid the backdrop of a hot real estate market in the Lower Mainland, the Office of the Superintendent of Financial Institutions (OSFI) applied new regulations requiring both insured and uninsured borrowers to be “stress tested” before a mortgage can be approved.
“Some clients are finding they’ve been re-priced,” said Resvick. “They can get less money now, so that means shopping for a less expensive home. It’s significantly reduced British Columbians’ homebuying power.”
For others, it means they’re out of the market entirely, unless a relative is able to chip in with a monetary gift. Some buyers are even moonlighting at part-time jobs to save for a down payment, while others pool funds with family members or even friends to buy a home.
“It’s getting harder and harder to get into the market these days,” confirmed Reza Sabour, a CMBA – BC Director. “A combination of factors is keeping buyers out of the market.”
According to Sabour, stress tests take can 20 per cent off a buyer’s purchasing power. That means people are forced to “drive to qualify,” meaning they are looking further afield for housing, even if that means a much longer commute to work.

Credit Clean-up

So, what can first-time homebuyers do to increase their chances of qualifying for a mortgage?
According to industry experts, it starts with getting your financial house in order – and that means cleaning up your credit.
“Lenders look at credit, and paying your bills on time,” said Suzanne Fleur de Lys-Aujla, a Director of CMBA – BC and Co-founder of Women in the Mortgage Industry.
“If you have great credit, then when you go to the lender it helps support the rest of your file. Managing your debt, for example not having a car payment, helps you get more mortgage.”
“The optics of a file have never been more important than they are now, said Rob Regan-Pollock, Senior Broker at Invis in Vancouver.  “A good broker would be able to convey to those buyers what they should do to improve their credit rating.  If there is high utilization on one credit card, figure out a way to reduce it to 50 per cent of your limit, for example. Ideally, we don’t want to see any credit pressure for first-time buyers.”
Lenders want to see stability, especially when it comes to employment history, and are increasingly assessing applicants based on financial risk models.
“Credit has never been on the forefront of the application as it is now,” said Sabour. “Credit history determines the rate you get, the product, the amortization, etc. So clean it up, and don’t go under any large financial obligation or consumer debt before you get your mortgage.”

Options and Assistance

In the past, a five-year fixed mortgage was the “go-to” for first-time buyers, but Sabour noted that new buyers are now leaning toward shorter terms with longer amortization – up to 25 years with less than 20 per cent down, and up to 30 years with a 20 per cent down payment or greater. Despite rising interest rates, variable rate mortgages are increasingly popular, as they often come with a lower monthly payment than fixed rate mortgages.
By Samantha Gale, LLB – CEO of the Canadian Mortgage Brokers Association – British Columbia
Here is a link to the Government of Canada web site that charts the "Final Revised Guideline B-20: Residential Mortgage Underwriting Practices and Procedures" :
***********************************************************************************************************************
If the high price of real estate, the lack of inventory or the prospect of higher interest rates didn’t scare us, the news of a so-called ”stress test” for hopeful home buyers sure did.
On January 1, 2018, the Guideline B-20 that is used by federally-regulated mortgage lenders, will require the minimum qualifying rate for uninsured mortgages to be either the five-year benchmark rate published by the Bank of Canada or the contractual mortgage rate plus 2% – whichever is greater.
The rationale behind this change is to further guarantee that if interest rates rise, which is expected, home owners will still be able to make their mortgage payments.
These new guidelines mean that even if your clients can get a mortgage for 3.5%, under the new rules they will be assessed as though they are paying 5.5% interest before they get any mortgage at all. This is what Ottawa was referring to as the new “stress test.”
The Superintendent of Financial Institutions (OSFI) announced its revisions to B-20 Guideline for Residential Mortgage Underwriting Practices and Procedures in October, which has led to anxious speculation that up to 20 per cent of people who apply for mortgages with Canadian banks will be turned away next year. Either that or they will be required to lower their expectations substantially for the kind of home they want or need.
The new rules are aimed more at uninsured mortgages which are those with a high (above 80 per cent) loan to value (LTV) ratio.
A loan to value ratio represents the amount of a mortgage lien divided by the appraised value of the property. For example, if your client borrows $92,500 to purchase a home valued at $100,000 their LTV ratio would be 92.5 per cent.  Mortgages with a LTV ratio above 80 per cent need to be insured, and those are the mortgages that will be more difficult to get under the new guidelines.
Here are some of the high level requirements in the new B-20 Guideline:
  • If a buyer was approved for a mortgage already, the new rules won’t affect them.
  • Banks are expected to honour existing pre-approvals issued under the old rules until those pre-approvals expire.
  • Individual lenders can choose which rules to impose on pre-approvals issued between October 17 and December 31, 2017 so it is strongly recommended that borrowers confirm the conditions of pre-approvals with their lenders.
  • Starting January 1, 2018, if a buyer gets a mortgage from a bank, all loan applications or pre-approvals occurring after that date will be subject to the new rules. There are no exceptions, even if the purchase agreement was signed before the new rules were announced.
Because Canadian banks are Federally-Regulated Financial Institutions (FRFI) they are obliged to conform to the B-20 Guideline. And OSFI will audit banks to ensure the Guideline is being followed. Credit unions, mortgage investment corporations, and private lending companies are not subject to the same federal regulations.
Mortgage Professionals Canada is an industry group representing close to 12,000 mortgage brokers, lenders and insurers. In July this year the group published Consumers’ Perspectives on Home buying in Canada. The report indicated the new stress test will mean close to half of Canada’s potential buyers will be subject to the new preapproval terms. When hopeful home buyers were asked what they would do in response, they indicated a few options:
  • 45% would increase their down payment amount
  • 45% would buy a less expensive home than hoped for
  • 20% would buy a home further away than originally intended
  • 39% would delay their purchase
However, the study also noted: “There are multiple factors in play in the housing market at present and it is too soon to draw conclusions on the impacts of the stress test policy.”
Critics of the new mortgage rules have pointed out that instead of dampening the risk from over borrowing, the new guidelines will simply drive people to borrow from private lenders that charge higher rates and come with less friendly terms. If that is true, it could defeat the government’s stated purpose to lower the risks from consumer debt.
As for credit union lending, Samantha Gale, CEO of Mortgage Brokers of BC, says that given credit unions are an alternative source for loans, they could become overwhelmed by the demand and simply run out of funds with which to finance mortgages.
On November 28, BCREA Chief Economist Cameron Muir made the following prediction:
“A rising interest rate environment combined with more stringent mortgage stress tests will reduce household purchasing power and erode housing affordability.”
He continued: “The 5-year qualifying rate is forecast to rise 20 basis points to 5.15 per cent by Q4 2018, and the new qualification rules for conventional mortgages will erode purchasing power by up to 20 per cent. Given the rapid rise in home prices over the past few years, the effect of these factors will likely be magnified.”
On December 14 CREA issued a press release that says British Columbia is projected to record almost 9,000 fewer sales in 2017 due to “an erosion of housing affordability” resulting from tighter mortgage regulations and higher interest rates.  CREA says the average price of a home in BC is forecast to remain steady in 2018.
As with any new government regulations, there will be a period of adjustment as all the players — from the buyers and sellers, to the Realtors and brokers, to the lenders and the lawyers—do what they can to work with the rules and still achieve their goals.



Gelderman.ca Real Estate Team
RE/MAX Aldercenter Realty

Office Phone: 604-743-7653 





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Friday, August 3, 2018

July 2018 Statistics from the Fraser Valley Real Estste Board

July 1028 Statistics Package



Inventory builds as summer slowdown hits

SURREY, BC – Overall housing supply continued to grow in July as sales dropped to their lowest point this year since January.
The Fraser Valley Real Estate Board processed 1,290 sales of all property types on its Multiple Listing Service® (MLS®) in July, a decrease of 33.4 per cent compared to the 1,937 sales in July of last year, and a 11.2 per cent decrease compared to the 1,452 sales in June 2018.
Of the 1,290 sales processed last month 346 were townhouses and 337 were apartments, together representing 53 per cent of all transactions in July.
Active inventory for the Fraser Valley in July finished at 7,399 listings, increasing 3.6 per cent month-over-month and 23.9 per cent year-over-year.
“Despite a much healthier level of inventory, demand continues to be influenced by pricing and market barriers such as the mortgage stress test and rising interest rates,” remarked Board President John Barbisan. “On top of that, summer is busy for people and usually a slow season for real estate.”
2,921 new listings were received by the Board in July, a 7 per cent decrease from June 2018’s 3,140 new listings, and a 11.5 per cent decrease compared to July 2017’s intake.
“A slower market like this one is an excellent opportunity for buyers to explore their options and enjoy a more relaxed purchasing environment,” continued Barbisan. “If you’re looking, talk to your REALTOR® who can help you get a full view on everything available that fits your needs.”
For the Fraser Valley region, the average number of days to sell an apartment in July was 21, and 24 for townhomes. Single family detached homes remained on the market for an average of 31 days before selling.

HPI® Benchmark Price Activity
• Single Family Detached: At $1,017,400, the Benchmark price for a single family detached home in the Fraser Valley decreased 0.1 per cent compared to June 2018 and increased 5.3 per cent compared to July 2017.
• Townhomes: At $557,500, the Benchmark price for a townhome in the Fraser Valley in the Fraser Valley decreased 0.1 per cent compared to June 2018 and increased 14.7 per cent compared to July 2017.

• Apartments: At $450,400, the Benchmark price for apartments/condos in the Fraser Valley decreased 0.7 per cent compared to June 2018 and increased 32 per cent compared to July 2017.

View the Full Package from the Fraser Valley Real Estate Board here: http://www.fvreb.bc.ca/statistics/Package201807.pdf







Gelderman.ca Real Estate Team
RE/MAX Aldercenter Realty
Web Site: www.gelderman.ca


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