Housing affordability has long been a thorn in the side of the Metro Vancouver story. Indeed, the rapid acceleration in home prices that occurred during the 2002-2008 period still has many people gobsmacked. Recent news stories have focused on the foreign buyer segment of the market, concluding that foreign investors are unduly inflating home values and driving potential domestic buyers out of the housing market, especially those looking to purchase their first home.

However, there are data and analyses from a number of sources that point to foreign investment as insufficient to impact a market as large and diverse as Metro Vancouver, save for a small segment of luxury homes. In addition, significant upward pressure on single detached home values is largely driven by land scarcity and densification policies in the metro region. These efforts have achieved relative stability in the values of apartments and townhouses that now comprise two-thirds of the housing stock.

The British Columbia Real Estate Association (BCREA) finds that:

• While no hard number on foreign buyers in Metro Vancouver housing market exists, the available data and analysis on the housing stock and flow of residential transactions in the region suggest that foreign ownership of housing is considerably less than 5 per cent of the housing stock and not more than 5 per cent of sales activity.

• The proportion of vacant dwellings, as well as the proportion occupied by foreign and/or temporary residents in the Vancouver CMA during the 2011 Census, did not diverge significantly from other large Canadian or provincial urban centres.
• Domestic investors are three to four times more active in the region’s housing market than foreign investors, adding much needed rental accommodation supply. In addition, adjusting for inflation and wage growth, apartment condominiums have become more affordable over the past five years. Further, relatively stable prices have provided little incentive for short-term speculative activity in the apartment market segment.
• The single-detached home stock has declined in both absolute and relative terms in the Vancouver CMA. This
increasing scarcity has led to significant price appreciation as consumers compete for the available stock.
• Regional residential densification efforts have led to relative price stability in multi-family housing over the past five years, as home builders have kept pace with demand. Multi-family housing now comprises two-thirds of the Metro Vancouver housing stock and approximately 80 per cent of new home construction activity.

• The average home price in the region is an inadequate yardstick for housing affordability. Nearly 70 per cent of
all MLS® residential transactions in Metro Vancouver during 2014 were below the average price of $738,000, with 32 per cent of homes sold below $400,000 and 82 per cent below $1 million.

RESEARCH RECOMMENDATIONS:

1. BCREA does not see a policy response to curb foreign investment as necessary for the public good at this
time. The available evidence of foreign investment into the Metro Vancouver Housing market suggests that it
represents no more than approximately 5 per cent of market demand and that housing affordability in the firsttime
buyer segment of the market has not been negatively affected.
2. BCREA recommends the government monitor the flow of foreign investment in housing by attaching a residency
declaration somewhere in the land transfer form process, or other practical approach. Gathering data on foreign
investment in housing would provide an opportunity to gain further insight into this market segment.

Fraser Valley Real Estate Board:

Slight shift in Fraser Valley market in May; sales edge down while inventory inches up

Sales on the Fraser Valley Real Estate Board’s Multiple Listing Service® (MLS®) in May remained at
strong levels – the highest since 2007 – however, they softened slightly compared to April.

There were 1,969 MLS® sales processed in May, a decrease of 2 per cent compared to April, however an increase
of 21 per cent compared to the 1,633 sales processed in May of last year.

Home sales in the Fraser Valley maintained a strong pace in May; however, we noticed a slight shift in the market. In certain areas, we saw interest in higher‐end detached homes pick up while demand for attached homes, which typically appeal to first‐time buyers, decreased.

The result is that the selection of apartments in the Fraser Valley improved in the last month creating greater
opportunities for buyers. Inventory of detached homes and townhomes remains tight, keeping the market
elevated.

It may help consumers to understand that over half the housing inventory in the Fraser Valley is attached homes, either condos or townhomes, while 60 per cent of all home sales are for single family detached. What buyers and sellers are experiencing is effectively two markets: a sellers’ market for detached homes and townhomes and a balanced or buyers’ market depending on the location, for apartments.

In either situation, you can benefit a tremendous amount from the experience and advice of your local REALTOR®.

The faster you can pay off your mortgage, the more you'll save in interest and the faster you can build wealth. Here are five ways to do it sooner:

1. Add a bit to your monthly payment. Finding an extra $50 each month could shave years - and thousands of dollars - off your mortgage.
2. Make a yearly pre-payment. Put a lump sum on your mortgage each year, eg. tax refund or bonus. There is a much greater impact when made early in the mortgage.
3. Increase your income? Increase your payments. Just pretend your income didn't increase and maintain your usual lifestyle.
4. Choose bi-weekly payments. Instead of paying monthly 12 times per year, pay every two weeks for 26 payments, giving you one more payment each year.
5. Stay informed. Don't let your mortgage go on auto pilot. Save money at renewal and take advantage of opportunities.

In a surprising report Canada Mortgage and Housing Corporation says it sees only two high risk real estate markets in Canada and neither one of them is Calgary.

Despite all of the attention focused on Calgary because of the plunge in oil prices, CMHC points to Regina and Winnipeg as the riskiest markets in the country.

In Regina, the agency cites price acceleration, over valuation and over building (particularly condos). In Winnipeg, over valuation and over building are the culprits. Local realtors tend to disagree with CMHC's assessment.

Prominent economist Benjamin Tal points out the risk is based on "price relative to the potential purchasing power of potential buyers." he says the assessment does not mean anyone is suggesting any sort of crash is in the works.

Calgary gets a low risk rating as does Vancouver - the most expensive market in the country. Toronto is deemed a moderate risk along with Montreal. On the whole, CMHC ranks Canada's housing market as modestly over valued.

When the time is right for you to buy a home, make sure you are financially fit and eligible for the best possible mortgage rates.

Here are five tips to boost your 'financial fitness':

1. Whip it. Whip your credit rating into shape: pay your bills on time... every time. Keep your oldest credit card for its history, and make sure it is always paid on time. Try not to apply for new credit, which includes co-signing for any type of loan.
2. Follow the 33% rule. Never run up a credit card or line of credit past 33% of its available limit. If you've got a $3,000 limit, then $1,000 is your absolute ceiling.
3. Cash is king. Gather up the maximum down payment possible. The more money you put down on a home, the better.
4. Be prepared. Put together a file folder with the following: pay stubs, or proof of self-employment income, list of debts and assets, and current bank statements. We can advise what you'll need.
5. Start a dialogue. Let's discuss your plan, and get off on the right foot in your home buying journey!

The process of qualifying for a mortgage begins long before you decide to buy a home! But if you make a plan to improve your financial fitness... you'll have no shortage of lenders willing to compete for your business.

It's June, and you should have received your property tax notices in the mail, with property taxes due at the beginning of July. If you have your taxes collected by the mortgage company, you still need to apply for any eligible homeowners grant on your property tax notice. Complete the grant and return the tax form to your municipal office or city hall - they know your taxes are being paid by the mortgage company, but they still need your grant information to compute your NET taxes owing. The mortgage company can then pay the tax funds collected over the year on your behalf and all should be well!

If you pay your taxes on your own of course, you can just apply for the grant and remit your payment directly to your tax office.

If you would like to change the amount of taxes being collected with your mortgage payment, talk to your Mortgage Provider's Servicing Centre.

As a prospective home buyer you have responsibility during the viewing of homes. You need to be sensitive and respectful when touring properties with your agent. Here are a few simple guidelines to follow during your home hunting days:  

Dress appropriately
Aim to look innocuous and don't let your clothes give anything away. You don’t want to look scruffy, but equally, if you look too smart the vendor might assume you've got loads of money and won’t negotiate.

Leave young children and babies at home
It is advisable not to take kids on a first viewing as they can be too distracting. If the vendor has children, then it is typically okay to bring them on a second viewing. However, if the vendor is childless, they may find it a bit of an imposition.

Arrive on time for the viewing
You should always make the effort to arrive on time. Also if you are coming with others, make sure you arrive together. Showings are usually set for a certain time and it is not only an inconvenience to your agent if you are late but the seller may be on a schedule. Often owners will leave just in time for a showing and may be waiting to return after its completion.

Take off your shoes
Even if you are not accustomed to taking off your shoes before entering someone else's home, it is best to do so when viewing a home so that you do not track mud and dirt into the home. People from various cultures and religions who do not wear shoes in home may be offended if you enter their house with your shoes on, so it is best to leave your shoes at the front door.

Respect the seller's personal property
While it is expected to open kitchen cabinets, pantries and closets, try to keep the investigation down to a minimum. Avoid opening dresser drawers, looking at personal items and using the master bathroom.

Don’t criticize things you don’t like in front of the homeowner
If the owners happen to be at home, keep conversation with them to a minimum. Most sellers try to be out when a showing takes place but sometimes it is just not possible. It is best not to "grill" them about why they are selling or where they are going. These questions are better filtered through your agent. The very worst thing you can do is say things like 'well we'd have to knock that wall down' and 'if we filled the pond in the garden it would look much better'. The vendor is probably very proud of their property the way it is. Although, some aspects of the house may not suit you and while you may not wish to purchase the home, it is best to have those discussions with your spouse out of earshot.

When leaving the home, it is nice to say things like, "Thank you for showing me around, it's kind of you to take the time" or "You have a lovely home". Vendors usually remember nice and polite people and favour them in any competition for the house. Most people have enough common sense to be courteous and careful when entering a stranger's home for viewing. When in doubt about protocol, just ask your agent. One of the standing rules about viewing a home is - leave it exactly the way you found it.