Residential sales in the Powell River real estate market continue to be steady at 36 for May though that’s fewer than last May’s 63 which was the high for the year. The shortage of inventory for the past 6 months or so has created a very competitive climate for buyers who generally have to act very quickly to have a chance at buying a home. Pressure on prices continues upward making it very challenging to be certain of the value of a home if you’re not keeping a very close eye on the market. We’re seeing an increase in new listings at 61 this May which is roughly on par with last May. The total inventory at the end of May stood at 125 and has been creeping up since January. It is roughly the same as this time last year, but well off the “over 200” range we were seeing during the Buyer’s market in 2013-2014. It continues to be a good time to sell in Powell River. Our prices are still lower than most areas on the lower coast which is the main reason for the interest in this area. Call me for advice on buying or selling in this changing market.
Pricing in a Rising Market
Pricing a home in this rising market can be a challenge. As frustrating as it is for buyers, it’s just common sense that a seller will want to get the best value for their home when they advertise it for sale. Unlike retail shopping, the value of a home is based on what people are willing to pay for it. In times of shortage, people are willing to pay more. How much more is the key question. A gut reaction to observers is that sellers or their REALTORS are being greedy in this market, but by the same logic, a person who sells a home for less than market value may be seen as foolish. In the current market, well-maintained homes that are well-priced are selling in a week or so. If it’s not sold in that time, there’s a good chance that it’s overpriced or it has some challenge – needs updating, location or other factors. It’s not uncommon right now to see homes priced a little high to be sure to catch the rising value if it’s there. This is why we’re seeing some price reductions on some homes right now. It’s not because the value is decreasing, but because the pricing was high to begin with.
In a rising (or falling) market, not all properties rise at the same rate. It’s about supply and demand of course. In the past year, we’ve seen the value of ocean views rise dramatically. In the past, ocean view homes always demanded a higher price but the additional amount is in some instances up to $100,000 above what a home would sell for without it. Not all ocean views are equal of course – it’s all in the eyes of the beholder! Those with unobstructed panoramic views tend to be the most popular. Other factors such as neighbourhood, direction of the view and potential for future obstructions will alter the value. Another market that’s seen increased interest is that of ‘ranchers’ – one floor living. Our demographic in Powell River is seeing many of us looking to downsize and consider what the future might look like in terms of our physical capabilities. One-floor living without stairs, a smaller yard and a smaller house to maintain makes ranchers a very good option. Generally, for the square-footage compared with larger homes, ranchers are selling at a higher price than they would in an area with a different age group.
What’s in the Lower Price Range?
Homes under $200,000 were reasonably easy to find only a year or so ago. Now it’s much tougher to find a move-in ready home in this price range. Since May 1 only four single family homes out of 22 properties have been sold. The rest were building lots, mobiles and some condos. However, even Westview condos have moved up over the $200,000 level. It’s getting much more difficult for people who qualify for a smaller mortgage to find a typical starter home.
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