Our market has slowed considerably and to some that is a bad thing. But in reality the runaway craziness of the last few years was not healthy. When buyers are bidding up properties they often pay too much and that may be great for sellers but it can create that "bubble" people often worry about. Now the market has settled in nicely. There are fewer listings and fewer buyers so that means fewer sales. Fewer sales tends to make people think the market is falling or crashing. So far none of that is happening.
Prices have been stable and most sellers are getting close to final asking price. We are not seeing the prices being bid up like we were a few years ago and that has allowed the median price to dip about 5% over the last year. Actual prices however have been flat. Higher interest rates have cut into buying power so people are buying less expensive homes to compensate, that is what has brought the median price down, not actual falling prices.
Yes, you will see price reductions but behind the scenes most of those price reductions are sellers realizing that their agent was right and they were simply overpriced. You can't blame a seller for trying to get the most out of their home, but in stable healthy markets, buyers won't bite on overpriced listings.
So long as interest rates remain where they are we should be able to sell enough houses to keep agents like myself busy enough to make a good living, inexperienced agents may struggle a bit, but us veterans will be fine. Younger people have not seen interest rates above 6% in their adult lives, but the 50 year average for rates is in the mid sixes, we are quite literally looking at pretty average rates right now.
Vancouver is seeing strong demand for real estate and that is being driven by multiple forces including excellent job growth, higher wage jobs, Portlanders relocating, Puget Sound relocations, and even some retirees taking advantage of our no income tax. Pricing should remain stable as I think the fed is going to dial back the medicine for now. We can only wait and see.
Builders may have to start building small homes again and Vancouver has shown a willingness to do zero lot lines and compact communities to help builders squeeze enough lots out a parcel to make $350,000 homes possible. Builders however tend to gravitate towards the larger luxury homes and they may feel a squeeze in 2023.
Overall healthy is the operative word, we have buyers and sellers in near equal numbers and that means stability barring any major economic changes in either direction.