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Looking to downsize? You may have to adjust expectations on your home valuation

Last Updated Apr 12, 2019 at 11:45 am PDT

A real estate sign is pictured in Vancouver on June, 12, 2018. THE CANADIAN PRESS Jonathan Hayward
Summary

If you plan on downsizing, the new realities of Metro Vancouver's real estate market could be difficult to accept

Some realtors are having difficult conversations with home owners looking to downsize after Metro Vancouv sales fell

METRO VANCOUVER (NEWS 1130) – If you’ve been considering downsizing because your home is too big for your needs, you may be following recent price declines for homes in Metro Vancouver.

Realtor Keith Roy with RE/MAX says in this climate some of the discussions between realtors and their clients can be a bit of a reality check.

“They’re difficult conversations, because in people’s minds they’ve built plans around a certain number and that number’s changed,” Roy explains. “This is your last chance to take a big equity gain in the Vancouver market, and it’s a difficult conversation. Sometimes it means a slightly adjusted retirement plan.”

Roy understands people can only delay their downsize for so long. He adds many are starting to accept a more reasonable price for their homes to get through their retirement years.

“They’re making the decision to take advantage of the lifestyle change now,” he says.

Home sales dipped to the lowest levels seen in March in more than three decades, the Real Estate Board of Greater Vancouver notes. The decline seen between March of 2018 and March of this year was just more than 31 per cent.

Last month’s residential property sales were 46.3 per cent below the 10-year March sales average.

Roy says, interestingly, many of the people who approached his company looking to downsize over the past 18 months had a selling number in mind that was “at the peak of the market, and they came after the peak of the market.”

Many of these prospective sellers, he adds, decided to put in extra work and hold off on downsizing for the time being.

However, with prices now down, he says things are starting to pick back up.

“I’m not going to tell you it’s great, but they’ve come back and said ‘OK, what’s the number now? If I were to retire now, what would my number be? Can I make this work?'” Roy explains. “And a lot of them are making that decision, and they’re deciding that their life is more important than squeezing out every last dollar from their home on their way out of the market.”

And while the numbers aren’t great, realtor Aaron Jasper with Royal LePage says there is an upside to this whole situation.

“I think it’s important — and we do point out to these folks — that the property type, if they’re looking to going into a condo or into a townhouse, that those prices are also coming down.”

He adds “When you switch over to being a buyer, you’re going to have the time to do your due diligence, to take your time, and those prices of those properties are also coming down.”

Jasper admits the sellers market in the region over the last few years has been a stressful one, but adds the market is balanced right now — even though it is leaned towards buyers in some cases.

“You have to be very, very sharp on your pricing. The market will tell you pretty quick if you’re on the mark.”

It was just a few years ago when a seller could name their price and “people were tripping over themselves,” Jasper recalls. However, times have changed, he notes.

“Nowadays you are really, really having to sit down and have your realtor do a thorough analysis and evaluating your competitive properties. What is everybody else listing at? How long are things staying on the market? And pricing very, very sharply.”

While he knows some sellers are still having trouble adjusting to the new reality, Jasper says he has not had to have challenging conversations with property owners who have certain dollar figures in mind based on peak market times.