Why Buying a Home (or at least seriously looking) in December 2018 Isn’t Such a Bad Idea….
Written By: Mariko Baerg, REALTOR of Bridgewell Real Estate Group
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Opportunity knocks: The winter market can get a bad rep sometimes, but the truth is December (especially this December) can be an excellent time to purchase your new home or investment property!
With a lot of buyers taking a “wait and see” approach, the market is feeling a bit dead. Buyers that get in the market now may be taking a golden opportunity while everyone is (hypothetically) sleeping on the real estate market.
With that being said, here’s our top reasons why the December 2018 market deserves more appreciation:
Sales are down.
The number of sales within the Greater Vancouver area is 34.7% lower for November 2018 than the 10 year November average. Less buyer demand means there is less competition, and sellers seem to be feeling the heat. You may be able to swoop in and get a good deal with little to no competition if the seller is motivated.
Inventory is up.
In addition to the sales being low, inventory has also increased. Not only is there less competition when it comes to ready and willing buyers, but you also have more to choose from! Having more options on the market means that you can be pickier in terms of layouts, renovations, and more.
Mortgage rates are set to increase moving forward.
With interest rates still so low, there has been talk of them continuing to increase in 2019. Although this won’t affect your purchasing power, having a higher interest rate will increase your monthly mortgage payment. If you hop on board now and lock in your interest rate (typically for up to 120 days), you’ll be saving likely thousands of dollars over the course of your term.
Buy when it’s going down and sell when it’s going up.
Yes there is uncertainty in the market, but if you look at the basics of value investing you’ll know that you should buy when the market’s down and sell when it’s up. If your plan is to hold for the long term, then buying during a lull might be a good play for you.
The dip from the foreign buyer’s tax took about a 4 month recovery, and from the 2008 recession Vancouver recovered within an 18 month period – so in the long term it’s safe to say Vancouver will pick back up.
Population is increasing, and buyer demand is present except many are currently waiting on the side-lines. I find buyers are taking a “wait and see” approach, and are ready to jump in upon any inkling of the market increasing. You might want to jump in now when it’s dead, rather than later when everyone else does.
Sellers of owner-occupied homes are more motivated.
Sellers in December have almost always already bought and need to sell, or are in some other dire need to move. If you can find out their motivation, you’ll have more leverage when it comes to negotiations. They’re more serious than a number of the spring/summer sellers that are just trying to “test” their home on the market to see if it sells.
Your agent may have more time for you.
When the market slows down and buyers go on vacation, your agent will in turn have more time freed up! If you’re looking for a time where you’ll have your agent’s sole attention, December is it! Now may be the perfect time to explore if you’ve even just been thinking about moving, and start to find out what it is you really want.
There’s typically less competition as a buyer in the winter market.
Buyer demand typically decreases in the wintertime, as most people are busy with the holiday season, events, and family gatherings. As a buyer this means that you’ll have less people bidding against you, and that sellers may be more willing to accept longer subject removals, more subjects, terms, and requests. The risk of you having to negotiate for a quick subject removal or subject free deal is seriously minimized because the market is less competitive than the spring/summer market.
Investor sellers and vacant home sellers will be extremely motivated.
A number of investors are going to be motivated to sell and close their property before December 31st to avoid addition taxes for 2018. You may find a good deal if you can close quickly.
The spring market is just around the corner.
The spring market where people start buying and selling in Greater Vancouver usually starts in February/March. More homes on the market means more buyers – which also means more competition and a higher likelihood of multiple offers. While there is some uncertainty in the market right now, historically in almost all cases the spring market will be busier than the winter. If you can find a home in December and avoid the craze, you’ll likely be in a pretty good position!
If you’re thinking about buying a home and are looking for a realtor, give us a call at 604-765-0376. Prefer text? 604-319-0200 or email email@example.com to start a conversation. We can give you some statistics and market research for what’s going on in the market of your dream home, and advise you on whether you should wait or take advantage of a good opportunity.
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