Canada’s Government Bond Yield for 5 Year Notes has declined from 1.39% to 1.26%. During the last 12 months, the 5-year bond yield remained relatively flat. By comparison, in November 2010, 5-year notes were yielding 2.48%. Yields remain at or near all-time lows that reflect ongoing global uncertainty, a trend which is reflected in yields on sovereign debt in other economies.

The Bank of Canada has shown no indication that it will raise rates until the currently risky economic outlook becomes clearer; likely in late 2013 at the earliest.

For investors looking to buy commercial real estate assets in Vancouver this points to debt financing rates at or near record low level heading into 2013.

A report released last week by BMO shows that sales volumes for existing home sales have fallen well below the 10-year average, “with realtors citing the federal government’s decision in July to temporarily suspend applications for the federal immigrant investor program as a dampening factor.”

Vancouver remains the priciest housing market relative to income, by far. “Still, with mortgage payments on the benchmark home (all types) consuming over half (52%) of
median family income, a further decline in Vancouver home prices would not be surprising, nor exceptional, as the city has faced four double-digit corrections in the past three decades.”

Source: BMO Capital Markets

Resales activity for single family homes in Port Coquitlam is down since the summer of 2012. This submarket typically averages about 35 resales per month, though since June, sales have been down below 30 per month, and November will likely finish even slower.

So far, price levels in Port Coquitlam have not been heavily impacted by the slowdown in sales. As of October 2012, the benchmark price index was up 2.4% from October 2011, though down slightly from June 2012.

Source: REBGV stats.

As of November 2012, there were 144 active listings for single family homes in Port Coquitlam. The average asking price of these listings is $612,627. Only 8 houses have asking prices over $1 Million.

Other facts:

• Average year built: 1983
• Average size: 2,250 SF