Derrick Penner
Sun
The Canadian Association of Accredited Mortgage Professionals survey of more than 2,000 people nationwide found that those who think prices will fall more than doubled since spring. Photograph by : Vancouver Sun files
British Columbians have largely resigned themselves to the reality of declining real estate prices, according to two new polls.
And while they have come to grips with the idea that they are on the downslope of provincial real estate markets, that appears to be the pressure release many prospective buyers have been looking for.
Ipsos Reid, in a report to be released today, found that 57 per cent of British Columbians expect home prices to decline in 2009 by varying amounts depending on the region.
In Vancouver, the survey found an anticipated drop of 6.7 per cent. In the Fraser Valley, respondents’ expectations were for an 8.1-per-cent decline.
And on Tuesday, the Canadian Association of Accredited Mortgage Professionals (CAAMP) released the results of a survey showing 48 per cent of British Columbians expected further declines in prices.
But the dropping prices look like relief to some buyers, according to the Ipsos Reid survey, which found six out of 10 respondents thought now is a good time to buy.
“A lot of people have been expecting the bubble to burst,” Hanson Lok, Ipsos Reid’s senior research manager in B.C.
Now, with prices falling, projections for them to continue coming down and a glut of homes on the market, buyers who are in the market feel better about the strength of their negotiating position.
However, while more people feel they are in a better position to buy now than they were a year ago, Lok said the current world financial roller coaster needs to sort itself out before many of them do buy.
“So a lot of people, while they feel prices are more advantageous for buyers, are going to hold out before they consider buying,” Lok said.
He added that they will also wait to find the bottom of the market, because “prices are much more advantageous, and if they wait a little bit longer, they’re going to get better.”
Ipsos Reid surveyed more than 1,600 British Columbians for its poll, with a margin of error of 2.4 percentage points, 19 times out of 20. CAAMP commissioned Maritz Research to canvas 2,000 responses from across the country.
Lok said the difference in sample sizes from B.C. likely explains some of the differences in responses around expectations for price declines, and that the results are likely not that far apart.
The CAAMP survey also found that some 35 per cent of B.C. respondents said they believed it is a good time to buy a home, compared with 33 per cent who believed it wasn’t a good time (the balance of respondents were neutral).
Nationally, 38 per cent of respondents said now is a good time to buy versus 32 per cent who did not.
And on balance, the CAAMP survey found people weren’t stressed about their mortgages, despite the declining prices, with 84 per cent of respondents reporting they are satisfied with their mortgages.
Murphy said he believes that relates to mortgage rates and the state of the general economy.
While both unemployment and interest rates are higher than they were a year ago, Murphy said they both remain at relatively low levels on a historical basis.
“In a broad sense, it really comes down to where people’s personal situations are,” he added. “If they feel their job is pretty solid and things are good on that front, and their [mortgage] rates are low, then they’re in a fairly good position.”
The CAAMP survey also found that Canadians borrowed more against the equity in their homes this year — 22 per cent compared with 17 per cent in 2007.
They also borrowed more, $41,000 in 2008, up 20 per cent from the previous year.
© The Vancouver Sun 2008