The new $600,000 home.
If you would have asked me back in 2006 when we were looking at town homes in West Cloverdale at the time, if I had imagined the town homes we were looking at were going to double in value, I would have laughed it off.
But today, I am confirming the new benchmark $600,000 home in Surrey and Langley is now the double garage (side by side) town home.
Back in July 2016, I had a coffee with one of my favorite industry friends, Mortgage Experts Alex McFadyen (you may know him as the mortgage pug guy) At that meeting in July I told Alex, by the end of next summer the luxury town house will be the new $600,000 home.
Alex did not call me a liar, in fact we both figured it would happen eventually. The real estate market being so hot, mortgage rates being so low. Prices were increasing.
Flash forward to March 2017 (present day)
Now a few months before summer, that conversation between two industry guys who happen to work with many buyers of real estate every year, has come true sooner then expected.
In the past 3 weeks, 3 double garage (side by side) town homes surpassed sales of over $600,000. Most recently, this week a Clayton Heights listing of $599,999 hit a sale of $612,500. Nothing special about the home, it was nice, but nothing special.
Depending on when you read this, If you are a seller of this type of property, the good news is by the time you read this article that product you own, a double garage (side by side) basement room town home, may actually be closer to $620,000.
The home that you and I grew up in, that was fairly large on a piece of land that cost our parents a small fortune (although those numbers seem laughable now) Is no more, is out of reach for most with the exception of the wealthy or those well off enough to be able to afford a detached home.
Why are these types of homes the new $600,000 bench mark? Well, with supply remaining very very low from Vancouver to Abbotsford, prices are on the rise, as the number of buyers is out weighing sellers, by a minimum 10-1. Properties are netting multiple offers just like last year, selling over asking just like last year, but here’s the wrench in the propeller of the industry; Mortgage lending policy is stricter. People can afford less. The detached home that was 599-799 is now in the high 800s. If it has a suite could be even higher. (depending on your city)
So, for those young families, people wanting mores space then the tandem traditional town home, this is the new luxury home they can buy. The prices are up 5-15% over last year in Cloverdale and Langley.
For that buyer : They want a bit of a yard, they want a bit more space, they want a side by side garage, this is now what they can buy. Disappointing? Perhaps. But this is the shroud reality, and price to live in this beautiful place we all want to call home.
So, if this type of home is not what you want, if paying $600,000 for a strata town home in Cloverdale turn you off but you want to still get into the market where do you go? What do you do?
For some, driving 35-40 minutes to Abbotsford is the easiest option. Where that town home is now lowered to $500,0000-$525,000. Or a detached home, older built in the 80s can be purchased for high $500s (as of now) Or for some driving even further, to Promontory Heights, Vedder, Garrison crossing or other popular Chilliwack areas is a better answer. In these areas, a 2 story home on a lot around 6500 square feet can be purchased for $600,000.
The market is very busy, always changing.
If you have questions, comments or concerns, text me and let’s grab a coffee 6049920616.