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Vancouver real estate market heading into more balanced conditions

The BC real estate association revealed Tuesday that British Columbia’s real estate market is heading into more balanced conditions after the first quarter of 2010.  Sales recorded by MLS show a levelling off as the number of property listings increase, pent up demand created by low interest rates dissipates, and new record price levels in Metro Vancouver erode affordability.  

Higher mortgage rates will squeeze some low equity buyer’s out of the real estate market. Big banks like the Royal Bank of Canada and Bank of Nova Scotia have already raised their fixed mortgage rates in anticipation of the new CMHC rules and regulations come into effect this month.  

 Though interest rates are the biggest threat to Vancouver’s real estate market rebound, they should only keep increasing if the economy keeps growing. As long as we keep experiencing economic growth people will continue to have jobs, incomes will be rising, and people will be able to afford higher interest rates.

A return to more balanced conditions would be welcomed by potential Vancouver home buyers after experiencing such a strong seller’s market during the last 10 months. A more balanced market will reduce the number of competing offer situations and allow buyer’s more negotiating room during the offer process.