Here is a report provided by Mike Wintermute, the General Manager of RE/MAX Sea to Sky Real Estate Whistler, with some links I've added to related sections on my main Whistler real estate website.
Half way through 2008 and one can only wonder where world wide economics will end up when we ring in the New Year. There is no one that has not felt some repercussions from the recent spike in fuel, the volatility in the stocks markets and the housing crisis in the US. While we don’t have the same exposure to the sub-prime mortgage fiasco that has hit the US we are never the less affected by a decline in exports to the US market caused by both the high Canadian dollar and the slowing US economy. Clearly central Canada has experienced layoffs in the manufacturing sector, certainly in Automotive production and BC is struggling in forestry. After several years of a very strong real estate market in North America the US has seen a dramatic slow down in real estate sales and declines in real estate values. Here in Canada we have just recently started experiencing a slow down in real estate sales and a cooling off in real estate price increases. There may even be some softening in real estate value as inventories increase and sales volume slows.
So what does all this mean to Whistler? From a value standpoint Whistler did not experience the increases in real estate prices that the rest of North America did during the past several years. In fact Whistler’s assessed values for property tax purposes increased about 10% in 2007, the first such increase since 2002. As I have pointed out many times our current values do not reflect the cost of new construction (replacement value). From an investment standpoint Whistler is undervalued when you compare Whistler to other resorts and continues to be a safe place to purchase and hold real estate.
Besides the quality lifestyle that Whistler offers there are two fundamentals that keep property values from dropping. The majority of property owners in Whistler are absentee owners, their Whistler residence is a second or third home. There is very seldom a situation where these home owners have to sell and they usually hold out for an offer close to their asking price. There are always reasons home owners decide to sell but in Whistler it is seldom because they need the money from the sale and therefore are not motivated by a quick buck. The second fundamental is a lack of new construction. Often times in a strong real estate market there is a large increase in new construction and at some point when the market cools there may be excess inventory which requires some price reduction to keep the market going. In Whistler regardless of a strong or slow market the one thing Whistler lacks in any appreciable amount of new inventory. More often when the sales volume slows down in Whistler it is usually due to a lack of desirable re-sale inventory then a lack of qualified home Buyers.
Finally there are the 2010 Olympic winter games. While we don’t expect real estate prices to be dramatically affected prior to the games there will be no doubt that the media exposure leading up to the games and the exposure during the games will introduce Whistler to hundreds of millions of potential new investors that will make a trip here after the games. While there may be uncertainty in the over all economic picture Whistler continues to be exceptional value and a safe and secure investment opportunity.
Mike Wintemute is the General Manager of RE/MAX Sea to Sky Real Estate Whistler.
