Surging Home Sales in Vancouver Creates Buzz

Vancouver in the last couple of years has experienced a dip in its sales and some of the downtown high rise markets have been stale. However, new reports out this September have now shown that the market is stirring. But the reasons for the stir may not be the best possible news for Vancouver, or for Canada
The lowest interest’s rates in Canadian history have apparently been doing their job. September home sales in Vancouver surged a whopping 64% up from the previous September. Most individuals look at that number and believe it means a full recovery must be in the works. However, many analysts are reminding buyers to approach with caution. They still believe there is reason to suspect a housing bubble is expanding but that doesn’t seem to be deterring buyers. One important fact to remember is September 2012 saw the lowest home sales in nearly thirty years. That means an improvement of 64% percent, while impressive, does not show a complete recovery has taken place.
While home sales have sharply risen, the rate at which homes have been selling has virtually stayed the same. In fact, home prices are actually 0.7% less than they were sitting at in September of last year. This means that in reality, homes are no greater an investment than they were last year. The only real difference is the market is actually excited right now, but that does not mean it will stay that way.
The Vice President of economics at Scotiabank in Toronto pointed out that rising mortgage rates, unimpressive job growth, and massive household debt are reasons to be very cautious on the market today. Of course, even though the new numbers released regarding the last few months of home sales have been positive, it is important to be cognizant of the economy surrounding Vancouver. Although many homeowners see Vancouver as untouchable it too has felt the blowback of Government mortgage regulations and low-interest rates.
In reality, numbers for home sales are still 1% lower than the average yearly amount. However, a strong rise in the amount of sales is significant despite what cautionary economist say. When home buyers see reports about record jumps in the percentage of home sales they are hungrier to buy, and when that starts happening a recovery is likely. So with heads held high the city of Vancouver is looking forward to even more growth over the next year.
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