Politics & Real Estate – BC’s interesting combo
POLITICS & REAL ESTATE
With an exceptionally strong real estate market since last March one must wonder how long will this continue, given all the political and economic uncertainty surrounding us. The Bank of Canada (BOC) held rates low for the 15th consecutive decision (every 6 weeks) and given the current state of affairs with our neighbours south of the border, it’s near certain we won’t see any upward movement through 2018. Prime rates set by the BOC are applicable to variable rate mortgages as those are closely tied to the Canadian Economy and have been our long-running favoured product. This is due to it not being expected to rise much, if at all until further notice (“further notice” having been targeted for 2011 back in 2010 and extended every year thereafter by our Finance Minister), we will likely have 9-12 months notice if we expect variable rates to rise and will report this promptly.
President Trump is revisiting the NAFTA agreement and discussions so far have flopped more than his hair piece. The outlook isn’t good as lay-offs have started in Quebec with the softwood lumber dispute. The BC’s forest industry is number one in 40% of the rural communities, and we will have an impact in our province. If the Federal Government continues to put a lid on the real estate market (the number one economic driver in 7 of 10 provinces) and NDP & Green’s majority government steps out of line, we’ll see an interesting next 4 years and an impacted real estate market. We can spin this viewpoint in many directions, but living in one of the most sought-after locations of the world with in-migration and migration bringing another million people to GVA, we can expect to see prices remain steady.
One would think after all the negative press the NDP has received regarding tanking Alberta’s previous “country leading economy” and BC’s economy 16 years ago, they would tread lightly on any decision that would impact our “golden goose” – real estate.
Macro and micro economic conditions aside, our inventory levels were poor a year ago and have moved to worse in 2017. The highly coveted $500,000-$800,000 purchase price point has little to no options, which is why we’ve launched a Purchase & Renovation program to help combat this problem. The condensed version is that home purchasers can buy a home with an unlimited renovation budget built in to their mortgage at competitive rates.
This, we hope, will increase the range of suitable properties, and clients can purchase in an area they like with an option to utilize a turn key renovation solution to give their home their individualized touch. For more information please contact our office directly at 604-329-9971