Multiple Offers..

(March 26, 2015, posted in Vancouver Real Estate)

Multiple Offers. Houses Selling Over Asking. Why All the Fuss?..

Open houses are busy, average prices have climbed to a new high of $1,397,305 in February for detached houses in Greater Vancouver, including suburbs such as Burnaby and Richmond, detached houses are regularly selling 5-10% over asking, multiple offers on detached properties are expected but where did this all this activity come from? Why now?

1. The bidding wars are primarily focused on detached homes. In many instances, detached properties are being sold primarily for their land value, with developers eyeing prospects for building larger homes on a site.
And speaking of land value, foreign investors continue to buy property throughout Vancouver as a way of investing capital and land banking in a market that much of the global investment community sees as only beginning to realize its potential.

2. Interest rates are low and so is the Canadian dollar. Spurred by low interest rates, the local Buyer is ready to bite and take advantage of record low mortgage rates in order to get into a property for the first time, or use this opportunity as a way to upgrade or invest in additional properties.
Foreign investors are spurred on by the Canadian dollar taking a dip greater than in has in quite some time and we are seeing an new influx of cash from the US and the UK because of this.

3. Supply & Demand - at the end of the day, and for all the reasons listed above, when supply is low (which it is) and buyer demand is high (which it is), there is upward pressure on prices, as well as, competition for product when it comes on the market.

At any detached home open house right now - if it's priced right - it isn't uncommon to have over 50 potential buyers come through bringing not only their Realtor, but the bank appraiser and the home inspector with them as well. Offers have to be clean and as subject free as possible to be considered for acceptance.