Changes in Government Legislation & Taxation Policies along with the policy statements accompanying these changes, is being felt in the Vancouver Market. Stiffer taxes on purchases by non-residents, increased transfer taxes on higher priced homes, tax levies on “vacant” homes (including vacation & secondary homes) - combined with the changes to mortgage lending rules - have signalled that every government level is determined to imprint the Real Estate market. The Governments’ actions are characterized by putting downward pressure on property values, while simultaneously taking a piece of owners’ equity & wealth. Data released by the Canadian Real Estate Association showed sales in Greater Vancouver falling 8.6 percent in March from a month earlier to 2,108 transactions - the fewest since 2013 - in contrast to the broader Canadian market, which showed signs of stabilizing in March. CREA also reports that local prices over the whole region ticked up by 1% in the month. Vancouver Detached homes’ sales profile was different, however. Both the West Side & the East Side saw the # of sales fall by 40+% in March & April vs those months in 2017, but the West Side saw Average Sale Price declines of as much as 14% in March, while Vancouver East saw an Average Sale Price increase of 3% vs 2017. A more telling stat is the Average Sale Price trend in 2018 vs 2017. Jan 2018 West Side Average Sale Price was up 14% over Jan 2017, but by April, the gap was 0%. East Side Average Price for Jan 2018 was up 14% over 2017, but by April, only 8%. That narrowing gap is an indicator of a general downward price trend, which naturally follows the downward sales #’s. While the long term outlook for Vancouver Real Estate values remains strong given its many attractive features - high quality, limited supply, strong local & international demand - the effects of Politics, Political Risk & Political Uncertainty has sidelined many buyers. Under a similar political regime during the mid 1990s, declines in population & immigration levels, property values & general economic conditions continued for several years, but this doesn’t really look like that - yet. We have a robust economy with strong employment growth & Amazon’s recent decision to expand its local operations, bringing 3000 new high paying jobs to downtown Vancouver is a harbinger of Vancouver’s brilliant future in this century. Real Estate markets operate in cycles, & changes like we are now seeing are a natural part of those cycles. Call Bob Bracken anytime to discuss this topic and real estate.
If you are looking to sell or buy real estate or wish to discuss further any topic on Real Estate, please contact Bob Bracken at 604-220-2035 cell, 604-263-2823 office, or firstname.lastname@example.org email.
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