Keeping it Real
Meet Jacquie McCarnan your host for Keeping it Real, the Vancouver and area residential real estate podcast that aims to demystify all things real estate in our crazy market.
Jacquie has been a licensed Realtor since 2016 and, in that time, has come across just about every scenario you can think of in our residential market. From hoarder homes to those for sale by owners to crazy strata situations and more, Jacquie provides real stories to help you navigate real estate in Vancouver and surrounding areas.
Each episode of Keeping it Real is short and to the point and provides you with great information about the topic discussed. Jacquie is always available to answer more in-depth questions and is happy to feature your own experience in future episodes.
Episodes also contain additional, non-real estate info about local businesses, experiences, and hidden gems around town that will make you sound like a local expert!
If you live in Vancouver or surrounding areas you know that the #1 thing people talk about is real estate (then the weather) if you want to sound knowledgeable and up to date on the real estate part listen weekly to hear topical issues that affect our market. We try to pick the most interesting and current issues to demystify each week and eagerly anticipate your input.
Join us every week for the very newest info on residential real estate in Vancouver and area.
Keeping it Real
Ep. 42 - From Tariffs to Interest Rates What Lies Ahead for Canada
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Could a tariff war with the United States shake Canada's economic stability? In this episode, we promise to unravel the complexities of Donald Trump's proposed tariffs on Canadian goods and what this could mean for inflation, interest rates, and the Canadian dollar. We'll take a close look at the Bank of Canada's response, including interest rate trends that could impact the housing market in North and West Vancouver. Despite the economic uncertainties, we'll emphasize Canada’s resilience as it stands strong among the G7 nations in post-pandemic recovery.
Additionally, we'll navigate the dynamic shifts in the North Shore and Vancouver Lower Mainland real estate markets as interest rates drop and the market regains momentum. With strategic insights, we highlight the importance of timing for both buyers and sellers amid reduced inventory. Learn how to tackle the cyclical nature of real estate, handle the new three-day rescission period, and negotiate multiple offers with the expertise of seasoned agents. Whether you’re buying, selling, or simply curious, this episode offers valuable strategies to help you make informed decisions in today’s economic and real estate landscape.
Hey everybody, welcome back to Keeping it Real and Happy New Year. It is January 2025 and this is the first episode of Keeping it Real for 2025. I haven't done an episode since December 6th and a lot's happened since then. So I'm just going to give you an update on what's happened and what we think is going to happen in the next little while. So and I'm going to keep it short and sweet so that you you know you don't get bored Just a super quick disclaimer that anything you hear on Keeping it Real is my own research and my own experience and I put them together to come up with a plan for you guys.
Speaker 1:Not everybody's going to agree to come up with a plan for you guys. Not everybody's going to agree. Not all realtors are going to agree. I just want to give you kind of an overview of what's going on right now in real time. So this will be super boring if you're listening to it two years from now.
Speaker 1:So let's start with the always super fun topic of the american election. I'm just gonna throw this out there because I think it's fascinating and I'm very interested to see what's going to happen. I mean not excited, but interested. Obviously, unless you're living under a rock. You know that Donald Trump was elected to the highest position in America and he has threatened, of course, to level tariffs on incoming Canadian goods, among other, like all incoming goods. So this has been something that has been swirling around in my head for quite some time and I figured. So I'm not an economist, let's just be very clear. But I always want to kind of give you guys the layman's opinion, because that's my opinion, and then see where the research takes us.
Speaker 1:So what I thought was going to happen will would happen if we have a bunch of tariffs is that it'll make everything more expensive. That will increase inflation. Increase in inflation will cause the Bank of Canada to slow down on the reduction of interest rates, and then we're not going to see the expected reduction on interest rates that we have been anticipating or that we're on the trend for. So that's what I thought was going to happen. And then I actually did a little bit more research, because you know you have an idea and then you think, ok, well, is this correct? So what ended up happening was there are a couple of things that could happen if we do have a big whack of tariffs. So it's possible that tariffs could slow our economic growth by reducing trade between Canada and the US, and if that were the case, then the Bank of Canada might lower interest rates to stimulate economic activity here in Canada proves resilient to tariffs, then other inflationary measures like supply chain disruptions, the Bank of Canada might adjust the rates and they could even go up to control inflation. So basically, the answer is that we don't know what's going to happen.
Speaker 1:A couple of things that we do know is that if there are tariffs levied on Canadian goods, it's very likely that the Canadian dollar will lose more value against the American dollar, which is fantastic. Because what are we at now? 60 something, 68? I don't remember. It's not great. I do think we all really need to keep track and pay attention to what's happening in the United States. I think a lot of my American friends often wonder why Canadians are so interested in American politics, and I think over the last few weeks we can really see why Canadians are interested in American politics, when policies that are being floated out there will have quite a detrimental effect on Canada.
Speaker 1:I really hope that these tariffs are not something that actually come true, but I mean, who knows? We'll see. It's crazy, crazy times. Just by the way, if you're my kids, you know this and if you're my friends and family, you know this. When I don't know what to say, I do that little giggle, and I don't want to. I just did it right now. It's frustrating. I cannot make it stop, so just please ignore that. I could always edit it out, but I don't know. I think it's kind of funny to have your flaws out there for all to see, now that we've talked about what's maybe going to happen.
Speaker 1:Oh, by the way, I would also like to mention that I am not Kreskin. I don't have a crystal ball. All I can really do is tell you what's happening in the market today. I really cannot predict what's going to happen tomorrow. I can also tell you what happened before, and in that case I wanted to talk a little bit about what happened with the interest rates in 2024. So we saw five drops in interest rates June, july, august were all 0.25, and October and December were 0.50. And the next interest rate announcement from the Bank of Canada is going to be on January 29th. So just mark your calendars if that's something that you're following.
Speaker 1:The Bank of Canada and most experts agree that we will continue to see rate drops in 2025. And they've agreed that the monetary policy of Canada no longer needs to be restricted. So for those of you saying things like, oh, this current government has ruined the country and put us into increased inflation so much, you need to understand or do some more research and recognize that out of the G7 countries, canada, our economy is number two, so we've actually done a very good job of bouncing back from the pandemic years. Okay, so what effect did those drops in interest rates have on the market in North Vancouver and West Vancouver? Great question what we saw was the first three drops happened in the summer, so June, july and August, and they were only 0.25.
Speaker 1:And I think and again this is opinion, I think a lot of people felt that they and I'm making air quotes missed out in 2020, 2021, 2022, or actually, yeah, okay, so up to beginning of 2022, when housing prices were super high and we were in battles to multi-offer battles and all that sort of thing. So when they first started seeing the interest rates drop, a lot of people listed their homes and what ended up happening? So listing your home in the summer kind of reduces the amount of people that are going to see it because a lot of people are out of town, a lot of people just don't shop for their real estate cyclical, particularly here in on the north shore. And so when all those places got listed in the summer there was a huge, there were a huge amount of places for sale and then, as the interest rates were coming down, buyers were kind of hemming and hawing, thinking, okay, we're going to see further drops, we don't want to really get into it until we see a significant drop in the interest rates. So by September we had a lot of inventory and buyers still being quite cautious. Then we got the October 0.5 drop and that seemed to stimulate buyer activity quite a bit. Certainly did in my business. I saw a lot more activity considering the.
Speaker 1:You know, leading up to September, october, leading up to October, there was very little happening on the North Shore. I mean, you know I can give you the stats, but it was all down, all the numbers were down. So then by December, you know, there was even which is weird because usually December things slow right down. But that didn't happen this year because that extra interest rate drop came through and when that happened I think a lot of people who had been waiting and waiting and waiting decided to pull the trigger and get into the housing market or change their situation. So by December, numbers were up considerably, which is great news if you are selling a house and not terrible news if you are buying a house, and I'm going to tell you why if you are selling a house, and not terrible news if you are buying a house, and I'm going to tell you why.
Speaker 1:So if you're selling, we have now sold through quite a bit of that surplus inventory and new listings are getting a lot more attention now. So if you are selling your house or hoping to sell your house, we are looking at a much better window to do that over the next couple of months, obviously before the summer, because, again, no matter what, we do have a cyclical market. So the spring market is generally the best time to sell your home, statistically speaking, and fall is second best. But what we're seeing is new homes are getting a lot of attention. Right now, buyers are still just a little bit, just sitting a little bit on the fence and we're not seeing a ton of inventory come out. In January it's very rare that we would see a ton of stuff listed, but over the next couple of weeks we are definitely going to see a lot listed.
Speaker 1:And the other thing about the North Shore or Vancouver Lower Mainland is there's a lot of weather dependency on this. So we always talk about the spring market. When does the spring market start? Sometimes it starts at the end of January because the weather is so mild and it's looking like that might be the case now. But I also don't have the Farmer's Almanac in front of me, so I have no idea what the weather's going to do over the next couple of months. But the earlier it starts kind of the better it is for sellers.
Speaker 1:Now, if you are a buyer, this is also a pretty good time to really pay attention, because we do have a little bit of inventory left over from 2024. We're not seeing a huge uptick in listings coming out right now. So if you are looking for air quotes again a deal possibly look back on things that have been listed for 90 days or longer and even if it's something you've seen before, maybe take a look at it, see if it's something that you could kind of make work and then save the amount of money in the offer so that you can make renovations or make that particular place work for you. So there are a lot of options for buyers right now. I don't know that that's going to be the case over the next few weeks and months. If the Bank of Canada continues to drop interest rates, we are going to see a whole lot more action, particularly from those sellers who again felt that they missed out in 2020, 2021, 2022, when prices were very high and we almost everything went into multiple offers. Everything I had in 2022, 2021 went into multiple offers. So there was just a huge amount of activity and I do think we are getting back to that.
Speaker 1:But do not fret, because a couple of things are different than they were back then. Number one we have the three-day rescission period. So now, if you make a subject-free offer, you have three days to change your mind. What I learned and I didn't know this at the beginning what I learned and I didn't know this at the beginning and I was upset to learn it was that you cannot use those three days to on places and then you know not having an inspection and really putting themselves out on a limb for what they were getting, because having a home inspection, in my opinion, is just one of the most important things, because who knows what's hidden, that you can't see A great home inspector when I have a couple names. But a great home inspector will be somebody who can find the stuff that you can't see yourself. So to buy a home without a home inspection is just I think it's kind of reckless. Anyway, doesn't really matter, because you can't do that during the rescission period.
Speaker 1:But if you have, let's say so. I tell people this all the time. Let's say there's a place that you love. You see it on the weekend. They're taking offers on Tuesday. You can have a home inspector come in on the Monday and get the home inspected and see if there's anything, really really any huge red flags that would make you not want to buy the home. That's kind of the way to go. It's. It costs you money. You know you might be out five, six, seven thousand dollars to get that home inspection done and it's it's on spec because you're getting it done not knowing whether or not you're going to buy the home.
Speaker 1:But if you want to put yourself in a position where you win at multiple offers, it's absolutely necessary, in my opinion, to have that home inspection report so that you know exactly what you're getting into. Otherwise you could end up with you know a home with a cracked foundation or you know, mold through the entire ceiling, which just happened to me with a client in November where we did a home inspection on an as-is-where-is home and we found mold everywhere. So we had a huge reduction in the price. It was absolutely necessary and I mean, nobody was happy, but everybody was happy. I guess that's what happens in a really good negotiation Nobody's 100% happy, but everybody's a little bit happy.
Speaker 1:I should mention to you too that winning in a multiple offer situation requires somebody with experience, an agent with experience. If you think that you are going to come into this next spring market as a buyer with no representation, first of all that's silly. Obviously I'm going to say that because I'm a realtor and I work with buyers and sellers. But in a multiple situation, if you are coming in without representation, you are at such a disadvantage because realtors, buyers, agents really understand how to make your offer stand out. And if you don't have that, you're going to get so frustrated. And if you're doing inspections on places prior to making offers, it's going to get expensive because you're not going to win at multiples without an agent and you're going to be out of pocket for the inspection.
Speaker 1:So I don't know, just get a buyer's agent. Whether that's me or somebody you know like and trust doesn't make any difference. Well, it makes a difference to me, but I'd like it to be me, obviously. But if you have somebody you know like and trust, that's great and I use them because they have tons of knowledge and they they're really able to help you understand how to navigate the market that we all believe is coming, understand how to navigate the market that we all believe is coming. So I think that gives you a pretty good overview on you know what we think might be happening, what the economic unknowns are at the moment. I think if the whole tariff thing happens, if it were me, I would be buying sooner rather than later, just in case you know. But I'm fairly conservative in my risk, maybe.
Speaker 1:But the one thing I want to leave you with. So do you remember back in July I was telling you that the District of West Vancouver had tried to get an extension for the Bill 44, which is the infill housing bill put out by the provincial government? Anyway, the provincial government didn't like that and they said no, you got to comply and West Vancouver said we don't really want to comply. So I just wanted to let you know that on August 12th 2024, the District of West Vancouver did comply with Bill 44 and it has gone through council. So if you own a home in West Vancouver and you would like to subdivide your lot, you can now do so without a reading through council. You will still have to apply for the subdivision permitting or zoning, but maybe, well, you have to put something through the district for zoning. You can call them, find out what. But I just wanted to let you know that if you do have a place in West Vancouver, you are now permitted to put more density on your property. That's all I've got for you today.
Speaker 1:I hope this is helpful. I hope it makes you ask some questions. Definitely, give me a call, drop me an email. I know you can DM me if you want to, if you're a millennial, but I'm always happy to answer questions and I want to wish you all just a happy and prosperous 2025. Thanks so much for listening to. Keeping it Real. It's a pleasure for me to do these. I really enjoy it. I'm not quite sure how many I'll be able to get through this year, but it's going to be fewer than one a week, I think one every two weeks likely. You can get Keeping it Real on Spotify or Apple Podcasts or anywhere you get your podcasts. Have a wonderful weekend and I will see you back here in probably a couple weeks, certainly after the next industry announcement.
