Why Isn't My House Worth A Million Dollars?
May 18, 2017 at 12:25 PM
Why Isn't My House Worth A Million Dollars?
“Only buy something that you’d be perfectly happy to hold if the market shuts down for ten years.” - Warren Buffett
Last week, Christie's International Real Estate released a report stating that Toronto and Victoria are now the world's "hottest" markets for real estate - both for home ownership and investors. In fact, luxury home sales in Canada increased by 44% compared to the UK which has seen a 67% decrease in luxury home sales.
Canada's stable political climate and economy seems to be appealing to many buyers from other countries who are seeing unrest and major changes to the economies. Other features that appeal to foreign buyers include quality education, health care and human rights records.
In April, Victoria did consider implementing a foreign non-resident buyer tax to their real estate transactions, although Victoria's city council voted the motion down at a meeting. Many real estate professionals in Victoria advise that it is NOT foreign buyers who are responsible for the increase in housing prices, but rather a shortage of available inventory. Most out of town buyers come from Vancouver or other parts of the BC mainland. A lack of homes available on the market has driven competition among buyers and resulted in multiple offers and aggressive bids (sometimes that are subject-free which I NEVER suggest to our clients).
What about the Nanaimo market? Housing prices have increased from an average $380,000 in May 2015 to just over $470,000 as of April 2017. Thankfully, our real estate prices have not become as high as Victoria or Vancouver, and with low interest rates, home ownership is remaining more affordable for many. Rentals are extremely difficult to find presently, and tenants have seen skyrocketing rent prices in Nanaimo and area which means that being a home buyer or tenant it is difficult to find a place to live.
Over the past 12 months, there has been a 3% increase in the number of single family homes listed for sale and a 5% increase in the number of sales. This April compared to April 2016 saw a 5% decline in the number of listings, so inventory levels are very low right now. One of the biggest drops has been in single family lots as we have seen lot inventory decrease by 34% in the past 12 months, meaning that there is less opportunity for buyers to purchase new homes.
There are always those people who benefit during a busy seller's market. Sellers who are downsizing can reap the benefits of a stronger sale price on their home, while others may be selling and relocating to a more affordable market where real estate prices are substantially lower. Home buyers who are purchasing a family home with legal suite can offset the costs of their mortgage with a higher rental income from the suite as well.
Typical in any type of market (which I have seen throughout my 38+ years as a real estate professional), there are going to be individuals who profit. If you are considering selling your home, and would like a FREE comprehensive market evaluation of your property, contact Brian & Myles McCullough today at 250-751-1223 or email us at [email protected]. If you are beginning to think about buying a property, we can help guide you through this process as well.
We look forward to speaking with you.
Brian & Myles McCullough
SELLING? If you are interested in selling your home or property, please feel free to contact me to get a FREE market evaluation of your home and learn the current value of it in today's market. This is completely at NO COST to you and you are under NO OBLIGATION to list your home. However, like any investment, it is wise to know the value of your home so that you can make informed decisions when making any changes to your investment plan or portfolio.
BUYING? If you are interested in buying or investing in real estate, view some of my featured listings on my website at www.mmshomes.com. Feel free to call me anytime at 250-751-1223. I look forward to hearing from you.
McCullough Marketing is here to assist you with ALL of your real estate dreams. I have found that it is often the small things that make the biggest impact for home sellers, and I am happy to share with you my booklet titled "90 Tips For Getting Your Home Ready for Sale" which I can email you. Feel free to contact me or email me at [email protected].