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Favourable market for buyers and it will continue for a while yet

September 19, 2008 – If you are in the market to buy a home right now or soon, and wondering when is a good time to buy, in many instances, would you not agree that buying is best when the price of the property is close to or has hit rock bottom?

The question is, how do you do this? It is a matter of economics. Supply and demand. I'll explain the process in brief.

Firstly, find out and track the number of listings in the neighbourhood you are interested in. If listings are going up and we are in a buyer's market, then supply is exceeding demand. This means that there may be more listings that will reduce their prices until a balance is achieved in the market. Conversely, the number of listings may drop until an equilibrium is attained.

Next, check the price of the listings and see if they have increased or decreased in price from their previous listing price. Since we are in a buyer's market, many listings at first will not have made price reductions but, eventually they may. In the meantime, find out which listings have reduced their price from their original listing price and see if more listings follow and eventually reduce their price as well. If more listings are reducing their price, a trend is occuring. However, be careful not to be overly optimistic, this may not last long. It depends on the market.

Following this, determine the average decrease in price and note it. If there are any changes to the market, you'll be making better informed decisions.

The above explanations are in general. Contact me if you need advice on following the market trend in your neighbourhood. It may lead to bigger savings.

Here are today's results of our analysis of "Active" listings:

Location: Vancouver West (West End)
Price range: $375,000 - $425,000
Classification: Attached
Active Listings: 37
Listings that have reduced their price: 17
Listings that have made price adjustments: 17/37 = 51.4%
Range of price reduction from previous listing price: 1.7%-6%
Average price reduction from listing price: 3.7%

In reviewing the above data, ask yourself, what will happen next? Find out by keeping track of the area you wish to buy a home in or contact me for help.