Make Mine a Double!
And yes…definitely SHAKEN, not stirred!
The surge in single family house sales for the month of March is phenomenal; up 67% in the Comox Valley, and 32% in Campbell River. Prices were up too. This is quite remarkable given how marketing efforts were hampered by the COVID-19 pandemic, over the past 2 weeks.
With all the theories, directives, opinions, trends, markets, etc, it is fair to say we are in a ‘target rich’ environment as to how each of us processes this paradigm shift. How will this all play out and when will it end? Who knows? For a solid perspective (in my humble opinion) please read Terence Corcoran in the Financial Post – https://business.financialpost.com/opinion/terence-corcoran-maybe-real-data-on-the-coronavirus-will-end-this-draconian-lockdown
Numerous financial lifelines are being extended, both by government and the private sector. My biggest concern lies with the falling prime rate and rising mortgage rates. Borrowers are racing to lock in rates, something we have not seen in a while. I was delighted to hear from a senior lender at one of Canada’s Chartered Banks: “the bottom line is that we are open for business”! Let us hope that it stays this way. With one million (plus) Canadians filing for Employment Insurance, and a pre-existing debt bubble, it may get worse before it gets better. Liquidity is going to be critical.
A couple of notes: rental properties are very difficult, if not impossible to market at this time. On top of everything else, getting VP – vacant possession – may prove to be very difficult.
Appraisers are very busy, as we are considered an Essential Service, under the heading of Capital Markets.
There are a number of appraisal options available:
1 – Desk-Top Appraisal, which as the name suggests is based on a review of data from computerized systems. It provides an estimated value range, within which the subject falls.
2 – Drive-By Appraisal also provides a value range, but is based on a limited ‘Drive By’ inspection.
3 – Finally, there is a Full Appraisal, based on a limited drive by, or exterior inspection. This provides a specific value estimate based on ‘Extraordinary Assumptions’, typically as to the condition of the interior of the home. Appraisers rely on a variety of information such as past MLS feature sheets, public records, and information and photos provided by the owner. This approach is mandated by the Appraisal Institute of Canada in response to the current crisis, and it has been endorsed by most lenders.