Generation X: just about to outbuy baby boomers?

The recent RE/MAX report shows that the present Canadian market with recreational property has been taken over by Generation X, which replaced the previous main buying force formed by the baby boomer generation growing older.

Who are the people in Generation X?

Over the years, social scientists have developed the practice of giving fancy names to the generations of the 20th century. Dating of a particular generation depends on all the different political and cultural features of the time that influenced the upbringing of members of that generation. The baby boom generation, that are people born from mid 40's till late 50's, was the strongest buying force, or at least until only a couple of years ago. But now the majority of these people have retired or are preparing for it.

Now the children of baby boomers (known as Generation X) have grown up and in their 30 - 40's they are in a sufficient financial condition to purchase recreational property at almost any price.
You will see this change especially when we compare the results of the first half of this year with the ones from last year. The trend moving toward recreational property buyers in their 30's was observed by 74 percent of markets in this year's surveys. The recreational properties sold varied from waterfront cottages to resort condos. This compares with only 40 percent in 2008. From January till April 2009, the number of sold recreational properties declined - at least two thirds of all surveyed markets reported such trend. But now, the buyer activity has grown with the beginning of the new cottage season, as we can see from the results of many major centres.

The most important points of the report:

Supply is suitable in most markets, but heated activity in the lower-end has resulted in tight inventory levels for entry-level product in 18 per cent of markets. Older cottage owners, a lot of whom own their properties outright, are selling to younger buyers with families. Some American cottage owners in Canada are taking advantage of the stronger dollar to cash out of the market. There are some exceptions of course, but we can say that American purchasers have mostly disappeared. One of the known factors in the marketplace is pent-up demand. For instance some buyers who had intended to purchase recreational properties in the second half of 2008 decided to defer the transaction till the next year. Florida, Arizona, California, Nevada and other warmer parts of USA are the states where older Canadians still continue to demand secondary homes. Generation X buyers are ready to spend their hard-earned money on vacation homes, but at the end of the day, they want to know that they’ve negotiated the best deal possible.

Photo source: thinkpanama

Relocating: The Hidden Cost

Relocating. This operation may get much more expensive than you would originally think, especially in case any problems come up (and sometimes even if they don't). No matter what way of moving you are considering, whether moving on your own or hiring professionals, there are always some expenses included. In this text we will break them down to give you a general idea what to be prepared for. Now you are maybe asking, so what's the problem then? Basically, there are two issues: in case of moving done by people themselves, it is too common to forget about all the additional tools, packaging material, transportation or the value of the time. But all these are related expenses you should count with. Also in case of moving with the help of a professional company, you might come across problems related to wrong company choice, wrong price calculation, or undervaluation of all kinds of additional expenses that are necessary, but weren't included in the company's bill. If you recall the first article of our "moving" series, we have already described the three options how to sort out your moving. They all differ by the level of your own involvement: either the professionals do everything for you, or you can manage all the work yourself - packing, loading, transporting and unloading. Or you may hire a company offering a hybrid service in case you’d like a bit more control over the whole process. Some companies might offer only the transportation; while other companies might offer loading, unloading and transportation of ready-packed things.

What’s involved? When you are beginning to organize your moving, the first step should be that you think about the budget. It will save you lots of trouble later. Generally, the relocation expenses can be broken down into four main categories: the transportation of your stuff, the packing of your stuff, the transportation of you and your family and the cost of starting up in your new home. The actual relocation. The first step should be calculating the main cost of moving your stuff. So will you be moving on your own, or hiring a company? This is the crucial issue you have most likely already decided. If a professional help is the way to go for you (we will bring some more tips on choosing the right company in one of the following articles), first contact them and ask for a written estimate of the price. It should say clearly whether the estimated price is binding or not, that means whether it is the final price, or there might be other fees coming up. Also the tips should be included - generally about $25 per worker.

The work and its cost. Secondly, the cost of the manpower that will do the packing and loading should be estimated - it may be the hired professionals, but also friends or family ready to help (it would be nice from you to at least buy them a dinner!), and also the cost of your time, especially if you need to take some off work. You should also count with the cost of any packaging material (boxes, bubble wrap, tapes etc.) and/or tools (i.e. dollies) you will need.

How much is the transport?. Thirdly, you have to estimate the price of the transport for you and your family - either flights, train or bus ride, or the price of petrol, if you are planning to travel by car. Also accommodation, food and possible entertainment while travelling should be calculated into the total price.

After the relocation: starting fresh There is usually a lot of problems and extra expenses connected to the moving, that people don't think about when they are in the middle of all the boxes. For example, you might have to pay a start-up fee for connecting up utilities such as a cable or telephone. Or think about your most likely empty fridge and freezer and the price of all the groceries to fill them up again. Also think about the price of any items you have left behind and you need to replace them now, such as various household items. Or maybe your new house needs a fresh coat of paint. It is always helpful to think first and jot down the costs of all the necessary items to buy, so that the total sum doesn't shock you after the moving.

As a Vancouver real estate agent, I have always tried to help my clients even with this issue, therefore I would like to share with you some useful tips & tricks: 1) Always compare how much it would cost you to move a certain item against how much the item costs when bought new. The result of this comparison might shock you. 2) You might have a chance to get a moving package from your new employer, if you are moving because of a new job. 3) Keep all the receipts connected to moving since you might be eligible for a tax deduction.

Photo: by Linda Yvonne

Moving: With Professional vs. Friends and Family

Moving your stuff from one place to another has never been simple, but as an experienced Vancouver realtor, I have gained valuable knowledge on how to deal with this complicate issue. However, just as in any similar case, experienced people can help you with some advice that will make this task easier. In order to help you, we will publish a series of texts about all the various aspects of a relocation: how much it costs, how the insurance works, how to choose the right company, and much more.

The first article will help you to decide whether to hire a professional company or do it yourself. Among the most important issues are the amount of money, time and labor you have available from your own resources.

Definitely the best thing to start with before deciding which approach you choose, is to write down and estimate the amount of things you will be moving and then asking yourself the following questions:

- How long will it take you to pack everything?
- Can you manage the furniture?
- Have you any special, expensive or heavy items that need special handling, such as pianos or the collection of art?
- Do you have any friends or family members living nearby, who could come and help you during the weekend?
- For the moving, you will need a large car - do you trust yourself driving something like that?
- Will you manage to accomplish your move over the weekend or will you have to take some days off work?

First you need to ask yourself all these questions, and depending on the results you have got, you will be able to pick the best way of moving.

In general, there are three options:

1. Full-service movers

There are a lot of companies specializing in helping clients to move, including packing the things, loading onto the vehicle, driving it to the new place, unloading and unpacking it. Well, however costly this may be, it's the best method for people who have nobody to help them, or who just don't have enough time to do the job themselves. All the packaging material, straps and all the necessary equipment is provided as a part of the service. All that is left to you is to let them do the job.

2. Self-service movers

If you decide to go for this method, you will be expected to be more involved too. The level of service provided may be not the same in each company. On one side of the scale, we have some companies that only provide a car with a driver, and the rest of the work (packing, loading & unloading etc.) is up to you to do or organize. On the other hand, the service may include help with loading & unloading, which you will appreciate especially in regard to the heavy furniture. This method of moving is the best one for the people who want to have more control over the whole process. And of course it is much cheaper than the full-service.

3. Do-It-Yourself

If you are able to do the whole moving by yourself, you will save a lot of money. Before choosing this method, there are many aspects to be considered, like the amount of your possessions, the distance, the number of friends and relatives available to help you and other things. The do-it-yourself way is usually great if you are moving from a small home or a flat. On the other hand, when moving from a large home across a long distance, it is usually better to use some professional help. However you want to organize your moving, a crucial part of the planning is the budget. Therefore the next article will deal with the cost that’s involved with moving.

Picture: Credits to carlaarena

Real Estate Market in Vancouver: Let's look back

Vancouver BC housing market grew for nearly seven consecutive years, one of the longest and fastest growths ever registered in Canada. Average home prices between years 2001-2007 nearly doubled, while inflation in the same period was less than 14%. Of course this situation meant that many people, especially the ones entering the housing market for the first time, couldn't afford just to buy a house.
After the US housing market got into problems, its Vancouver relative still worked fine for some time and managed to grow until the beginning of 2008. However, in that time the pressure of affordability demand started to influence our market and realtors noticed slowdown, which grew even stronger in next months. At first, the average price stabilized, but later declined, and under the influence of the global economic crisis in the autumn 2008, the housing market of Vancouver got into record-low values in January and February 2009. People were generally afraid of the deep and long taking real estate crisis as the one in the USA.
If you believe the same, look at the statistics around – February 2009 was the point of rebound, not the beginning of stagnation! Since then, all real estate crucial statistics in Vancouver BC show positive trend. If we look at the sales numbers, we can see that the figures in June 2009 reached almost 6 times higher than the level from February and almost twice higher than the results from summer 2008. The percent increase in June 2009 was 75.6% confronted to June 2008. Average price fall stopped in December 2008, remained flat till March, since then continues to increase steadily again. The prices in June 2009 reached again the same level as they were in October last year.

Does this amaze you? Just look at the statistics closely. Look at the new listings change graph. The rapid inflow of new properties on the market stopped many months ago in October 2008, after this month the overall inflow was falling.

This has an easy explanation, which lays in the obvious advantage of residential real estate, which is that people just need a home to stay. People do really need a dwelling, while they can pretty well survive without cars, hairdressers or holidays. Even though the demand may decrease, it is unlikely for it to reach zero level, even for a limited period of time. Certain rules should be kept at the supply side. Your home often is the most expensive item of your whole property. When prices are declining, it may be a good decision to hold your property and refuse selling it, but then this kind of approach helps new housing starts. Finally, buyers and sellers have to reach some point of consensus and the earlier they do, the better for both.

So what are the underlying factors behind Canadian market's fast recovery, regarding that the US market is still fighting with the crisis? The worst part of the US story - wave of foreclosures - was successfully avoided in Canada. The Canadian institutions and individual home owners are in better fiscal situation than the ones in the US. It doesn't mean we are richer; it means we are better prepared to cope with acute financial problems. One of the sectors most affected by the crisis in the US was the subprime mortgages, which is much less common in Canada. Of course our economic fundamentals could be in a better situation now, but they are still quite stabilized.

So what future development can we forecast for the Vancouver BC property market? Sales and average prices are likely to grow steadily during the few oncoming months. Nevertheless, the situation will calm down after getting to the pre-burst level, due to overall economic slowdown. Next year will be awesome especially for first time buyers – with record-low interest rates and prices still under the recent peak, homes won't be so affordable forever!

Vancouver district map by svacher