The latest statistics show continuing slackening in Vancouver’s residential real estate market. While signs of a slowdown in the single family detached market have been growing for some time, the latest figures point to the same trends beginning in the condo market as well.
According to the Real Estate Board of Greater Vancouver, the inventory of unsold condos surged in July, up over 66% from July of last year. As well, the average price of a typical condo apartment fell slightly; REBGV’s “benchmark” price was down 0.5% compared to June.
The Vancouver condo marker is still hot compared with the rest of Canada. Greater Vancouver’s rate of price growth, while slowing, is still six times larger than the national average. But the trend lines continue to point downwards.
(Check out the e-newsletter Better Dwelling for this and other facts on Vancouver’s real estate market.)
Many businesses rely on the owner’s home equity to prop up the business, by providing readily available capital by way of mortgage loans. As the real estate market slows, that source of capital will also slow, with more and more lenders pulling out of the second and third mortgage lending business. Rising interest rates will accelerate this trend.
This in turn will lead to more businesses unable to re-capitalize following poor performance. The result: more business crises.
Businesses are urged to get insolvency and restructuring advice at the first sign of business stress, BEFORE the “bank of home” runs out of money.