Maple Ridge home owners have, in the past year, enjoyed a 25-per-cent jump in the value of their houses.
According to the Real Estate Board of Greater Vancouver, that’s the amount that single family homes have jumped over the past year, meaning that if you had a $500,000 home, it could now be worth $625,000.
But be cautious, says realtor Ron Antalek.
“Be excited about our windfall, but not necessarily spend it. That’s all.”
Historically, boom housing markets last between six and 30 months, he pointed out.
Metro Vancouver is now in the 26th month of a booming market.
Others are now saying the current market is completely different than anything that’s happened in the past.
“Some of the people, when they have equity like that, they refinance, they take it out, and they spend it and then they buy a car or motorbike and they increase their debt,” Antalek said.
Real estate is still the best investment, just be conservative about it, he tells his clients.
“It’s tempting to access our equity and have fun with it, but home ownership should be long-term investment,” he adds.
“Be conservative and you’ll have a comfortable future, no matter what the interest rates do.”
Robby Toor, with Envision Credit Union, offers the same perspective and says people who are thinking of selling their homes to cash out should think carefully.
He says while your house price has climbed, so have prices for all houses. If you decide to sell, then rent for a while, you could be priced out of the market later.
He describes today’s market as “unusual” and “unpredictable and that other factors are at play.”
With interest rates at an all-time low, any increase could slow down home sales.
“What’s more, foreign investment is a major factor in the record-breaking gains we have been seeing.”
He also says people should avoid taking equity out of their home to buy cars or vacations.
“Should the market reverse, you don’t want to be stuck owing additional money on a home that has decreased in value or even owing more than your home is worth.”
Local realtor Rob Jeeves agrees the market is unpredictable. But it’s almost as much an immigration issue as a real estate issue, he said.
Houses are being bought by “rental immigrants,” he said, foreigners who live here briefly to have their children educated while they continue working elsewhere.
The low Canadian dollar also makes it attractive for foreign buyers who have U.S. dollars.
“In some respects, they’re playing with monopoly money. That’s what’s fueling a lot of this right now,” he said.
This country is built on people who came here to become Canadian, Jeeves added, and that hasn’t been happening the last decade.
He said there’s a huge influx of money into the country from around the world seeking a safe place to invest.
You can leave a house vacant for six months in Vancouver and you come back and it’s still there.
“You try that in South Africa and it’s not going to be there.”
Antalek says he’s never seen such a market. This March was the busiest in history, with 5,173 home sales producing an overall jump of 23 per cent in prices in the past year in Greater Vancouver.
“It’s not local and a lot of the pressures and what is coming on is coming from outside our community.”
Homeowners priced out of the areas near Vancouver are now moving here.
“But I think the fuel, immigration and foreign money, absolutely, is one of the catalysts to the whole thing.”
While the areas close to Vancouver have seen price jumps, Maple Ridge is now feeling the heat of the hot market as foreign buyers now getting used to Maple Ridge.
“The wave effect has had a greater delay the farther out you go.”
Kelowna and the Sunshine Coast are now also seeing prices rise.
“It’s a challenging environment to predict.”