The Vancouver Sun is spreading the news: July sales in the Lower Mainland lept up. Prices in Vancouver and the Fraser Valley are still lower than they were a year ago, but a large number of first time buyers are said to be moving into the market:
Lured by the correction in home prices and low mortgage rates, first-timers are jumping into buy in numbers that are now rippling across the market as evidenced in July with record numbers of sales for the month in both Metro Vancouver and the Fraser Valley.
Proof that it’s different here? Or are these people looking forward to the same disappointment many in the US are experiencing?
Tsur Somerville, a real estate expert in the Sauder School of Business at the University of B.C. said there are signs of more stability in the overall economy, but it is difficult to see the pace of sales continuing at such peak levels.
“This is a very, very high level, and [long-term mortgage] interest rates have already started creeping up,” Somerville, director of the centre for urban economics and real estate at the Sauder School of Business said.
“It’s a wonderful, positive statement about people’s outlook for where things are going,” he added, “but it’s hard to put together the set of circumstances where sales of this level are sustainable and persistent.”
Tsur also says he doesn’t expect prices to turn around and plunge without a substantial change in rates.
Full article in The Sun.