Will the Real Estate Market Soften

Too Many Factors to Guess Market Direction

• 
• By Nancy Smith
• Qualicum Beach REALTOR®
• Published: Apr 18th, 2022 at 8:29 pm

There are some articles suggesting the USA market is softening, due to increased mortgage rates, the end of Covid incentive money and a price-charged housing market. However, projections are just opinions, these market movements are often based on past data. We know this has been a useless exercise over the past two years.

Here on Vancouver Island, we still stand firm on our attractive reasons for a vigorous market until 2025, at which point, who knows. The retirement segment will continue to be enticed, many wealthy Canadians are ready to invest in cottages and recreational properties, and there is an inheritance factor for the next generation, who themselves are financially fit. It is somewhat anecdotal, but recreational property sales have pushed up market prices, as many of these are waterfront, lake and river homes and acreages. Recently, one specific property sold for $1 million above asking price... whereas, only a few years ago, home sales above $1 million were the exception.

Home prices quite literally have doubled in many areas on Vancouver Island over the past 2-3 years. People who decided to wait for a 'crash' in the real estate market are finding it difficult to enter the market, especially for single family homes. Even now, a 25% drop in real estate prices will still result in sustantially higher prices than three years ago. In as much as the Bank of Canada ( US Federal Reserve ) would like to hike interest rates to cool the housing market, they have a much larger problem with financing their own debt, so it is highly unlikely to see too much of a jump in mortgage rates within the next seven years.

Keeping in mind, as Realtors, we are not financial consultants, and are not experienced in market movement, and this is also why the past three years has been a real eye-opener for the the established agent. We can only provide as much information as we can for our clients, but final opinion and decision is still the client's.

I can provide the latest Listings and Sales information, if you are contemplating Selling or Buying property between Bowser and Ladysmith, BC