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Real estate markets are by nature cyclical.  There is an ebb and flow to things, both within a given year and over the course of a number of years.  The last few years have represented a soft market from a long-term viewpoint.  The average number of sales have declined, and the average sale price has slowly declined.  Within that long-term viewpoint, is a shorter-term. 

Christmas and the New Year are well behind us and we are all beginning to imagine life without the threat of snow.  This is the beginning of the real estate season - a time of increased market activity.  From a Realtor's perspective the first three quarters of the year (January 1 to September 31) is a time when we expect to see new listings come on the market.  The last three quarters (April 1 - December 31) is when we expect to see all those listings sell. 

This year is a little different.  The Canada Mortgage and Housing Corporation (CMHC) has implemented new qualification parameters to take effect March 18, 2011.  In summary, they are:      

• Maximum amortization period (for a mortgage with loan-to value ration over 80%) is reduced from 35 years to 30 years.
• Maximum loan-to-value ratio for refinance of a 1 to 4 unit residential property will be 85% (down from 90%).
• Mortgage insurance for non-amortizing housing loans (lines of credit) up to 80% loan-to-value ratio will no longer be available.

These new rules will make high-ratio home financing somewhat more difficult.  This means that many qualified buyers may move to buy a home, or property, before the March 18, 2011 deadline.  Ultimately this means that the annual buying cycle will likely be moved up and we will see more properties sell earlier in the year.  It follows that sellers should have their homes on the market during this time of increased demand.  This has not even taken into account the future threat of higher interest rates.

In short there is a long-term and short-term cycle to the Alberni Valley's real estate market, yet if you are planning to buy or sell in 2011 the best time may be now.