The Vancouver real estate market kept its growth as far as till the beginning of 2008, while the many times analyzed trouble of the US market started already some time before. However, the market slowed down as it’s been influenced by the pressure of affordability demand, and the market freeze continued for a few months. The average price got stable at first, but later decreased. As the global economic crisis became a problem during autumn 2008, the sales of Vancouver real estate decreased to extremely low values during January and February 2009, which inspired the general panic that we would face the same long and poor crisis period such as in the USA.

If you believe the same, look at the graphs around – February 2009 was the month of rebound, not the start of stagnation! Since then, all real estate crucial indicators in Vancouver BC show positive trend. Sales in June 2009 were almost 6 times higher than in February and almost double confronted to the previous summer. The percent change in June 2009 was 75.6% compared to June 2008. Average price decline came to a standstill in December 2008, remained flat till March, since then continues to grow steadily again. June prices already arrived to the level of October 2008.

Is this surprising? Not so much, if you look at the numbers carefully. Let’s examine the graph of new listings change. New houses kept flowing to the market till October 2008, then the general inflow started to decrease.

This has an easy explanation, which lays in the obvious advantage of residential real estate, which is that people just need a place to stay. People do really need a home, while they can pretty well go without cars, hairdressers or holidays. It is possible that the demand for homes falls, but it can hardly fade away completely, even if it was only for a short time. There are some ruless that the supply side should follow. Real estate items in many cases represent the most expensive part of your personal property. In the period when prices are declining, you can decide to keep your house and not to sell it. On the other hand this would stimulate new housing starts. Eventually, an agreement has to be reached at some moment both for sellers and buyers, and the sooner the better.

So what are the reasons for the Canadian market recovering so early, whereas the US one is still going through the crisis? The reason lays in the fact that in Canada, we had no wave of foreclosures, which was the most critical event. The Canadian institutions and individual property owners are in better financial condition than the ones in the US. Canadians don’t necesssarily have to be richer, but apparently they are more ready to cope in case of any acute financial problems. Subprime mortgage sector (the most affected one in the United States) is much more limited in Canada; our economic fundamentals are not in the best situation now, but still quite stabilized.

So what next development can we forecast for the real estate market in Vancouver? Sales and average prices are likely to grow steadily during the few oncoming months. However, after the numbers reach their pre-burst levels, the situation should stabilize, because of the general economic slowdown. Next year will be great especially for first time buyers – with record-low interest rates and prices still below the recent peak, homes won’t be so affordable forever!

Finding the right property

Before your agent starts their research for the right house for you, he or she will make you aware of the way the agency operates and also will familiarize you with the ‘Working with a Real Estate Agent’ brochure, which you will be requested to sign.

Then your agent starts his or her search for suitable houses for you. Real estate practise in Vancouver is different probably from most other places, because both the agents (the listing and the one representing the buyer) plus of course you as the buyer have to attend the showing, so it usually takes some time to synchronize everybody’s schedule. When your agent is successful in finding you the right property, your agent will provide the document ‘The Contract of Purchase and Sale’, which serves as an offer to the seller. For you to be able to propose the right price, your agent also provides some background information. Especially in Vancouver you should expect multiply offers from different buyers on the same property, so don’t get scared if there is even 15 other buyers bidding on the house you’ve chosen.

Closing the contract

When your offer is finally accepted, you will have to wire the 10% deposit to the seller. Take into the consideration that the bank wire could take up to 14 days before it is delivered to the Canadian bank. You might choose to use some dependable third party services (e.g. House Global Foreign Exchange) that would guarantee a timely delivery of the deposit, since that’s part of the contract. Once your financing is settled, the Home Inspection Report on the property was satisfactory, you’ve gone over all the property’s documentation and all the issues you might had were answered to your satisfaction, you can remove all that the contract was subjected to. As per the closing date – it is mostly scheduled 2 days before the possession date. All adjustments has to happen before the possession date.

Legal arrangements

The deal then moves onto the lawyers or notaries for preparation of legal documents to transfer the title to you, the buyer. The federal and provincial taxes must be addressed at this time. You either have to be personally presented to sign the documents in Vancouver, or you can choose to have them couriered to a law office near them where all the documents can be signed under seal. The appropriet funds will then have to be send to the Vancouver lawyer’s trust account.