Illusion or Delusion - NOTHING is Selling Right Now!

Illusion or Delusion - NOTHING Is Selling Right Now!

Sorry to start with the boring disclaimer type sentence, but in an effort to not get our message misconstrued, we’re aware you may not be in the right personal circumstances to buy a home and that is totally fine. This article is just aimed at ‘keeping it real’ should you decide to step into the real estate world any time soon. Kind of like going to the beach… You check the temperature before the day and make a decision on whether to go or not. This is like checking the temperature of the real estate market. So don’t be delusional!!

It’s come to our attention by many forms of feedback, there are a lot of people out there believing NOTHING is selling right now. Therefore every seller is desperate, no wait, BEYOND desperate for anyone, just ANYONE, to come and write them an offer on their homes. Well we’re here to tell you that’s not the case and to slow down, it’s just a market correction, not Chernobyl (great series btw, you should watch it!)
The above can somewhat be understood if you are thinking that way, but it’s the next point that REALLY amazes us when we hear it. Just to make sure you don’t miss it, we’ll write it out in capital letters plain and clear - PRICES ARE GOING TO REDUCE 50% or 60% and so on. 
So to put this into perspective, with this logic we are saying;

  • A $1,000,000 home becomes $400,000
  • A $500,000 home becomes $200,000

As of June 2019, Vancouver has a combined benchmark sales price of $998,700 (let’s round up to $1,000,000 for easy math.) Calgary, which has undergone a substantial blow since the downturn of the oil sector, with quite literally hundreds of thousands of people losing their jobs, and business going under, has a benchmark pricing of $411,100 right now. So using the above logic of a 60% reduction, Vancouver is going to reduce to numbers below Calgary, who once again as a reminder, had an economic collapse. Further to this, Edmonton is one of the top 5 most affordable areas in Canada to purchase a home at a benchmark price of $368,600. Once again, using the above logic means Vancouver - one of the most expensive areas in Canada to live - will now be competing with one of the cheapest places to buy a home in Canada. I feel silly just saying this out loud.

In all fairness, I applaud the optimistic thinking if you are a buyer. Unfortunately though it’s a case of “when it’s going up it’s always going up, and when it goes down, it’s always going down”. That’s true until it stops and people frantically try and get in before it’s too late. Literally the case of every upturn and/or downturn that’s taken place.

The reality is, a couple of years ago, the market would have killed for any type of discount and now they are getting it in a 10% discount in the last year alone. That discount becomes even bigger when you look at the correction as a whole. Unfortunately the above thinking is only helping you in one way - how NOT to get ahead in this market.

That’s us until next week, thanks for reading and don’t forget to follow us on social media and reach out with any topics YOU want covered!

Jay Mcinnes
T: 604.771.4606

Ben Robinson
T: 604.353.8523