Housing "Stock"
Your Realtor is not a stockbroker. You don’t phone them every afternoon and ask, “how’d my house do today?”
Yet sometimes, this is how Vancouver’s housing market feels – like a commodities exchange, and in both directions. Right now of course, the direction is down.
A supply and demand thing; but in my view, a lot of demand is hiding out.
Many of my Realtor partners see it at their open houses. In a truly correcting or crashing market, open houses would be empty across the board. But this Spring, there are still plenty of shoes on welcome mats; it’s the offers that are scarcer.
I see it at my desk, too. Lots of conversations – even more right now than at the same time last year, actually – and many of those chats are leading to rate-holds and pre-qualifications, rather than people actually buying. And many clients refinancing their current homes, to groom themselves for a move; but they’re not squeezing the trigger on a move just yet.
From my trench, I can tell you: buyers are there. They’re just waiting.
Like day-traders, some buyers seem to be trying to “find the bottom.” Some are making “stink bids,” and circumstantially a couple of those bids are “getting filled.” Mazel tov, I say; but those seem few and far between – more in the high end of the market right now.
Of course, there’s also the very reasonable fear of being “caught upside down on a trade,” of buying in a market that continues to go down. Never a good feeling. I totally get that.
So if Vancouver’s market is going to keep feeling like an exchange of commodities, perhaps it’s time to refresh our view of our “housing stock.”
An investor I admire once said, “buy a stock the way you would buy a house. Understand and like it such that you’d be content to own it in the absence of ANY market." The opposite seems true in Vancouver: some seem to be trying to buy a house in the way they would buy a stock.
By the way, that investor is Warren Buffett. And I bet if HE were in the mood to buy a home, he’d do so in the way HE invests: rather than timing the market, he’d study the fundamentals and look for long-term intrinsic value.
What are Greater Vancouver’s fundamentals? Economy, policy, law and the like; yes, that needs to be considered. But the bare basics? Get on the water or a mountain one sunny Saturday morning, and take a good long look around. Short of a giant meteor, what you behold isn’t going anywhere. In fact, it’s what’s bringing many people here.
Stop trying to time the perfect trade in our Blue-Chip city. Don’t wait to buy real estate; buy real estate and wait.