Real estate in British Columbia has risen steadily over the past several years, pushing many young families out of the market due to the high cost of an old home. It was in 2016 when the market level blew through the glass ceiling and the market sky rocketed to a point that all of British Columbia felt the shock wave, including Revelstoke.
Mass Spataro is the Managing Broker at Remax in Revelstoke and has been a part of the firm for eight years now and bore witness to the frenzy of 2016/17. Mass joined Cynthia Kidd and became a partner and co-owner of RE/MAX Revelstoke in 2016 and from his recollection it was a whirlwind.
“It was just a blur, full on days, it was nonstop all year.”
During this year, foreign money was dominating the Vancouver market, buying up real estate as if it was a Monopoly board. Many in the lower mainland were cashing in on the opportunity and selling their house for 3-times the amount they bought it for, offsetting the value and raising a new financial barrier of entry for first time home buyers. While this was not necessarily the case in Revelstoke, the foreign money of the lower mainland was pushing the lower mainland money to the interior and Vancouver Island.
“You could see it happening. A wave of money from overseas was pushing the Vancouver market dollars out of the lower mainland and up into Revelstoke.” Spataro explained with confidence.
Since 2016, houses have gone up 20% and that is without any renovation or work put into the structure. Revelstoke has a historic texture to it, the houses in the downtown core set the tone, however, many of them are in need of upgrades, even to today’s safety standards, with Revelstoke’s lack of new inventory to choose from, older stock was flying off the shelf.
The Provincial Government set in place a 15% Foreign buyers tax that was designed to offset costs and deter overseas buyers from using BC as a way to make money, although it hindered it, the foreign purchases continue today. “After awhile the foreign money just shrugged off the 15% tax”
The past year Spataro found that inventory continued to move quickly, with multiple offers.
“Because of the social climate, the demand is here to live, so the prices, in all likelihood, will not go down. This is where they (the buyers) want to be.”
Spataro has noticed that a good portion of the buyers or those interested in buying are not here to turn a profit. Most of those he has met through this process are interested in buying homes, raising their families and setting roots in the community.
“There are always going to be those that play the real estate game and monopolize property for a quick profit. Lately, that has not been the case.”
One issue that remains is if you are not in the market, it is very difficult to buy in now. With a high demand for old inventory, you have to be ready to buy with a decent deposit to get in, and that is after the Mortgage Rule.
“Mortgage rules are that the banks will stress test to see if the potential buyer can handle a 5+% rate rather than the 3.5%, which can cause concern for those that are worried about being priced out of the market.”
Revelstoke has such a demand that some people try to sell their homes privately with a sign out front. When asked what the downside to selling privately is, Spataro shared his view on what could potentially go wrong.
“When you know you are listed, you know you are protected and being taken care of. There are sharks out there and will take advantage of others, a senior citizen perhaps, we make sure they are protected. Also, you know that your home is being viewed nationally and internationally which can heighten the odds of a sale. I have also seen people underprice themselves because they didn’t realize its true value.”
Spataro expressed that he understands why some people try to sell privately. They feel that the money they save on realtor fees is the amount they are willing to go down to the potential buyer of their home. “We’ve seen some people come into office after trying to sell privately and say never again!” What many don’t know is that realtor fees are negotiable between the seller and the broker.
“I focus on the client’s needs. We know that it is a lot of money, but we focus on what they need, what is best for the client and make sure they see the value and feel that it is worth it. Everyone’s situation is different”
When asked how he felt knowing that many local families who have been here a long time, have been stock piling their money and working at building up that down payment for their hopeful home, Spataro shared a story that reminds him of that situation on a regular basis.
“I had a single mom who could not go over 300k and the market kept creeping up and creeping up- I kept telling myself that I have to find her a place! Luckily, I did. That was a really good feeling.”
Four years ago the hard sell floated around 600k, now that price point are easily moved off the market and the new cut off is close to 1.2 Million dollars.
