In my last blog, I looked at why buyers in an urban center market like East Vancouver seem to have much less fear committing to a home purchase than buyers in a suburb market, such as Port Coquitlam: they lack the sense of urgency that makes a person want to commit to buy a home.
You might then ask, "What creates that sense of urgency?"
1. Fear of losing a deal
In a market as hot as Vancouver, it's safe to assume that there are several buyers at any given time waiting for a hot deal to come there way. Chances are, if your Realtor has sent you a listing and suggested that you act quickly to take advantage of a deal, there are 100 other Realtors out there who have done the same thing with their 100 other buyers.
2. Fear of market conditions worsening
I've run into a lot of clients recently who have been scared by their friends recently into thinking that the market is slipping and about to take a downward spiral. I'm not sure where the friends are getting their info from, but all the REBGV stats I've seen show the market hitting a 10 year low sales-to-actives ratio in early 2012 and picking up steadily since then.
3. A proper supply and demand curve
Speaking of sales-to-actives ratios, this is usually a good indicator of whether or not the market is flooded with products. It tells you the ratio between how many homes of a particular type are sold in a given month and how many are on the market during that same period. To put things into perspective, for every new condo on the market in East Vancouver in Dec 2013, there were 0.215 condos sold. In Poco for the same period, there were 0.095.
4. Financial availability
It goes without saying that the more money a person has, the more they will be willing to put towards the purchase of a home. That being said, in a market where homes cost more money, the buyers that the area caters to will be more willing to jump on a deal or write an offer on a home they fall in love with than the buyers in a market that caters to a more frugal population.
So there you have it! Four factors that affect a buyer's sense of urgency. If you are thinking about buying a home, make sure you are aware of these factors and how they might affect your decision making process. Remember that the two most important factors that you need to consider are:
1. Is this home in my budget? and,
2. Is this home a good fit for me?
Market conditions will always vary and deals will come and go, but as long as you answer yes to the two questions above, you won't regret your decision to buy.
Thanks for reading and remember to practice safe real estate - always use a Realtor!
Century21 InTown Realty