KIV Community

Real-estate slump could clip forecasts (TC)

Welcome to Café Island Parent, a place to meet with other parents and post comments on any topic you wish. Discuss movies you've seen, places you've been, or even your best method of taking time from the kids.

Note: Unless you are paid advertiser, business advertising is not permitted in this forum. For business advertising click

Moderators: Brenda N, Sue, Glowingtouch, kattnipp

 

Real-estate slump could clip forecasts (TC)

Postby OnceHarmony on Sat Mar 02, 2013 8:39 am

Anyone else like my DH and I who are still waiting on the sidelines for prices to go even lower? Hopefully, the interest rate will stay low too.

"Real-estate slump could clip forecasts

Andrew Duffy / Times Colonist
March 2, 2013
Times Colonist

A slow start to the year may have the Victoria Real Estate Board reconsidering its position that the region’s property market could see modest growth in 2013.

Based on a forecast from economist Cameron Muir at the B.C. Real Estate Association, the local board had anticipated a “modest” increase of between two and four per cent in sales activity this year.

But poor sales in January and February may jeopardize that forecast.

“They are definitely not great numbers,” said Shelley Mann, president of the Victoria Real Estate Board. “I would say if we don’t see substantial growth in March and April we may have to re-evaluate.”

Mann said the region historically sees the highest volume of transactions and activity in March, April and May. By the end of that stretch, they will know where the market stands.

The figures released by the board Friday show February’s sales, while an improvement over January, dropped 18.3 per cent compared with February 2012.

Last month, there were 394 sales in all property types, down from 497 in February 2012. There were 294 sales in January this year.

Year to date, the board reports 688 total units sold, down from 869 sold over the course of the first two months of last year. In that time, total sales in dollars dropped to $305 million from $399 million in 2012.

Mann said January and February are always the toughest months, but she said there are signs of life yet in the market.

“We have seen sales numbers increasing over December, January and February,” she said. “there has been increased activity, though it may not be [reflected] in the numbers right now. But I do see a lot more optimism now than I did a month ago.”

Mortgage broker Scott Travelbea said he’s seen some of that optimism at his offices.

“I’m getting people in for pre-approvals,” he said, noting while that is normal for this time of year, there’s been a noticeable increase in volume.

“This week alone, we have had 10 new applications come through the door to get pre-approved. As far as new deals are concerned, that’s quite a bit of activity.”

Travelbea did say tighter lending rules have had a ripple effect through the market.

With first-time buyers having more difficulty getting in, it has slowed condo sales, meaning condo sellers have had more trouble using their equity to move on to a single-detached home.

Mann said while sales activity may still be weak, prices have not reduced substantially.

Last month, the median sale price of a single family home was $505,500, down from $530,250 in February 2012, though it was an improvement over the median price of $482,500 recorded in January.

The median price of condominiums dropped to $270,500 from $276,250 in February 2012. It is much improved from the median sale price of $238,350 recorded in January.

The median of townhomes was $337,500, which is down from $378,450 in the same month last year and from the $382,000 in January of this year.

“Many buyers are still waiting for prices to drop, but it’s clear to me that sellers are in a holding pattern regarding the value of their homes,” Mann said.

“However, if a house is priced properly, within the market-value range, it will likely sell more quickly.”
If more of us valued food and cheer and song above hoarded gold, it would be a merrier world. But, sad or merry, I must leave it now. Farewell - Thorin
User avatar
OnceHarmony
KI(vic) Member
KI(vic) Member
 
Posts: 4862
Joined: Thu Mar 20, 2008 5:54 am
Location: Florida or SNL
Region:

Re: Real-estate slump could clip forecasts (TC)

Postby NatB on Sat Mar 02, 2013 3:03 pm

The market, in my opinion, is definitely cooked. Like the US it will take 5+ years to correct, if I buy again, it won't be until 2017-ish.
NatB
KI(vic) Member
KI(vic) Member
 
Posts: 509
Joined: Sun Feb 18, 2007 8:10 pm

Re: Real-estate slump could clip forecasts (TC)

Postby NatB on Sat Mar 02, 2013 6:54 pm

“Vancouver Island real estate is crashing.”

Might be interesting to some....

http://vreaa.wordpress.com/2013/03/02/v ... /#comments
NatB
KI(vic) Member
KI(vic) Member
 
Posts: 509
Joined: Sun Feb 18, 2007 8:10 pm

Re: Real-estate slump could clip forecasts (TC)

Postby Sha on Sat Mar 02, 2013 8:02 pm

I bought two and a half years ago. At the worst of the lows. If I listened to the nay-sayers (on this forum), I would still be renting. As it turned out, I was super-lucky to buy then. I could never qualify now for a mortgage, even though I can easily pay one. A mortgage payment it so much lower than rent.
Last edited by Sha on Sun Mar 03, 2013 1:19 am, edited 1 time in total.
Sha
KI(vic) Member
KI(vic) Member
 
Posts: 1078
Joined: Sun Jan 16, 2005 9:48 am
Location: Marigold
Region:

Re: Real-estate slump could clip forecasts (TC)

Postby organic momma on Sat Mar 02, 2013 8:23 pm

A family member just sold with multiple offers I've Vancouver they are now looking in Victoria I think they will be lucky now
"It's not due to laziness that someone is poor, it's not due to a lack of ambition or lack of intelligence its because they lack things that we take advantage everyday" Living on one dollar a day
User avatar
organic momma
KI(vic) Member
KI(vic) Member
 
Posts: 8627
Joined: Mon Jan 31, 2005 8:16 am
Location: Gordon Head
Region:

Re: Real-estate slump could clip forecasts (TC)

Postby DELETEPLEASE on Sat Mar 02, 2013 8:31 pm

Mann said while sales activity may still be weak, prices have not reduced substantially.


Really depends on how you define "substantially". Prices are down over 10% from the peak, which is over $60,000 for the average house. However he is probably correct that the more substantial decline is still ahead of us.
Last edited by DELETEPLEASE on Sat Mar 02, 2013 8:37 pm, edited 1 time in total.
DELETEPLEASE
KI(vic) Member
KI(vic) Member
 
Posts: 402
Joined: Mon Jul 02, 2012 12:02 pm

Re: Real-estate slump could clip forecasts (TC)

Postby DELETEPLEASE on Sat Mar 02, 2013 8:35 pm

Sha wrote:I bought two and a half years ago. At the worst of the lows.


What do you mean, "at the worst of the lows"? 2.5 years ago was almost exactly the highest of the highs for the Victoria market.

Image
DELETEPLEASE
KI(vic) Member
KI(vic) Member
 
Posts: 402
Joined: Mon Jul 02, 2012 12:02 pm

Re: Real-estate slump could clip forecasts (TC)

Postby Sha on Sun Mar 03, 2013 1:22 am

I'm sorry. I was being a dunce. I didn't mean low prices. I meant worst time to buy. High prices.
Sha
KI(vic) Member
KI(vic) Member
 
Posts: 1078
Joined: Sun Jan 16, 2005 9:48 am
Location: Marigold
Region:

Re: Real-estate slump could clip forecasts (TC)

Postby DELETEPLEASE on Sun Mar 03, 2013 8:06 am

Sha wrote:I'm sorry. I was being a dunce. I didn't mean low prices. I meant worst time to buy. High prices.


Gotcha.

In the end the right choice is always individual. In the same market different people can be ahead by renting, and ahead by owning. All depends on your personal situation.
DELETEPLEASE
KI(vic) Member
KI(vic) Member
 
Posts: 402
Joined: Mon Jul 02, 2012 12:02 pm

Re: Real-estate slump could clip forecasts (TC)

Postby OnceHarmony on Mon Mar 04, 2013 10:19 am

organic momma wrote:A family member just sold with multiple offers I've Vancouver they are now looking in Victoria I think they will be lucky now


Hi OM

Do you mind if I ask what you mean by "I think they will be lucky now"?

You don't have to worry about answering. I won't jump down your throat. I've taken the 12 step Real Estates Anonymous program. :lol: I'm just curious.

Thanks
If more of us valued food and cheer and song above hoarded gold, it would be a merrier world. But, sad or merry, I must leave it now. Farewell - Thorin
User avatar
OnceHarmony
KI(vic) Member
KI(vic) Member
 
Posts: 4862
Joined: Thu Mar 20, 2008 5:54 am
Location: Florida or SNL
Region:

Re: Real-estate slump could clip forecasts (TC)

Postby TazDevil on Mon Mar 04, 2013 6:31 pm

The way I look at it is we bought 5 years ago. If we had rented instead we would have actually "lost" $90,000 ($1500x60) giving the money to a landlord's mortgage instead of ours.

Our House Assessment has gone up over 5 years by $80,000 so that is quite a cushion.

Unless you have to sell or go bankrupt, there is no actual loss, just like the stocks.
Be a yardstick of quality. Some people aren't used to an environment where excellence is expected.

Steve Jobs
User avatar
TazDevil
KI(vic) Member
KI(vic) Member
 
Posts: 4988
Joined: Sun Jul 31, 2011 11:06 am

Re: Real-estate slump could clip forecasts (TC)

Postby NatB on Mon Mar 04, 2013 9:29 pm

Garth was good today:
http://www.greaterfool.ca/2013/03/04/sp ... 242omments

In announcing last month’s unhappy sales numbers yesterday, Shelley Mann, boss of the real estate board in Victoria, put it this way: “Many buyers are still waiting for prices to drop, but it’s clear to me that sellers are in a holding pattern regarding the value of their homes.” And that’s about right. Rapacious buyers are battling delusional sellers. And the victims are sales. In Victoria, for example, the number of deals last month was 18.2% below year-ago levels.

In Vancouver house sales plopped a wicked 29%. In the Lower Mainland, the Fraser Valley board says realtors there took a 28% hit, compared with February of 2012. Saskatoon was down 18% last month. Montreal is down 14%. Toronto realtors have yet to report, like those in Winnipeg or Ottawa.

In fact, falling sales have been a consistent story now for the past eight months, despite cheapo mortgages, rising stock markets and the outbreak of bidding wars, surging house prices and rising sales in the US. With few exceptions, tumbling sales presage lower prices, which we now have in Vancouver and Victoria, for example. So, do hopped-up, aroused wannabe-buyers like Val and Ryan just suck at being patient?

Fitch thinks so.

The big ratings agency has been investigating how to calculate the risk on pools of residential mortgages which lie at the core of some massive securities. Fitch is developing a new financial model which can estimate potential losses among Canadian mortgages if the housing market jumps the shark the way it did in the US.

The conclusion: Canadian real estate is overvalued by about 20%. In the last five years prices have risen dramatically, “when underlying fundamentals suggest that growth is unsupportable.” This, you might remember, is consistent with forecasts by outfits like Capital Economics (25% decline) and even the major banks (10-15% drop). It also echoes international opinion, as expressed by tomes like The Economist, now calling our market “the most overvalued in the world.”
NatB
KI(vic) Member
KI(vic) Member
 
Posts: 509
Joined: Sun Feb 18, 2007 8:10 pm

Re: Real-estate slump could clip forecasts (TC)

Postby brymommy on Tue Mar 05, 2013 6:45 am

I get being excited about lower prices, however I wonder if it's really worth it to buy in such a depressed market. Not because of the market itself, but because of the surrounding economy. Maybe I'm the only one who sees it :? But every day it seems either my husband Facebook or mine has people picking up and leaving and moving to where there are jobs. I see it here, although not as much. Business' are closing or struggling (in the case of a few I know). My Realtor just emailed me and said they are watching others drop like flies and they are hopeful to hold on.

There seems to be depressed markets in the states that still haven't recovered and the ones that have seem to be booming again.

Then blogs say "sell at all costs - get out" and others are saying "wahoo we can't wait to buy at the bottom"... Sorry I don't fully understand. I could sit here for hours and fully explain myself but I don't have the time. But why would one be looking forward to buying in such a depressed market where so called "experts" are saying dump your houses and run!

Personally I'm scared for friends and family if the market goes lower. Because it's not just housing that's affected. It's people's lives and business' and livelihoods. I think it's highly unreasonable that you will see houses at pre 2000 boom prices. And if you do it scares me to think what kind of worse economy has led to that.

People are sitting on their houses' now because they either can't afford to sell for less or don't want to. Personally I don't know if I could live in an economy that depresses far enough to have more people in such deep trouble that there's a foreclosure on every corner.

We moved off the island, we still own a house there but the S^!+ would have to hit the fan ridiculously hard before we considered losing our shirts on it. We are no where near upside down, we could list for a steal of a deal and probably sell tomorrow (if we didn't have tenants) and not owe anything at closing. Or we can ride it out and for us that's the better option for many reasons.

I am personally hoping for the sake of the economy, people's livelihood and overall well being that the market either stays where it is or recovers slightly...
<insert witty phrase here>
brymommy
KI(vic) Member
KI(vic) Member
 
Posts: 4897
Joined: Fri Nov 25, 2005 2:06 am
Location: around
Region:

Re: Real-estate slump could clip forecasts (TC)

Postby DELETEPLEASE on Tue Mar 05, 2013 7:31 am

brymommy wrote:Then blogs say "sell at all costs - get out" and others are saying "wahoo we can't wait to buy at the bottom"... Sorry I don't fully understand. I could sit here for hours and fully explain myself but I don't have the time. But why would one be looking forward to buying in such a depressed market where so called "experts" are saying dump your houses and run!


I don't really understand your point. In the end it comes down to what is best for you (by which I mean, each individual person, not you personally). If your job is not secure and you might need to leave in a year or two, then now is a very risky time to buy, because in a year if you have to sell you might be facing a big loss.
As you said, some US markets are on the rebound after huge declines. The people that took the risk and bought into those markets a year ago have done well.

As for the "experts", well they are just there for information. Just because someone says "dump your houses and run" doesn't mean they're right, or that option is good for you. Just like when your realtor says "it's a good time to buy" doesn't mean they are right either. The only thing you can do is gather information from both sides and make your own best decision.

Personally I'm scared for friends and family if the market goes lower. Because it's not just housing that's affected. It's people's lives and business' and livelihoods. I think it's highly unreasonable that you will see houses at pre 2000 boom prices. And if you do it scares me to think what kind of worse economy has led to that.


I fully agree. We rent so lower prices benefit us, but only to a point. Overall I would rather live in a city with a good economy even if the houses are expensive than one with cheap houses but a poor economy. Luckily I don't think there is any danger of a return to 2000 prices. There are almost certainly more declines coming, but no collapse.

We moved off the island, we still own a house there but the S^!+ would have to hit the fan ridiculously hard before we considered losing our shirts on it. We are no where near upside down, we could list for a steal of a deal and probably sell tomorrow (if we didn't have tenants) and not owe anything at closing. Or we can ride it out and for us that's the better option for many reasons.


Probably. But the people that are driving the Victoria market right now are not the people like you. They are the people that do need to sell, and so they sell for less.
DELETEPLEASE
KI(vic) Member
KI(vic) Member
 
Posts: 402
Joined: Mon Jul 02, 2012 12:02 pm

Re: Real-estate slump could clip forecasts (TC)

Postby TimAyres on Tue Mar 05, 2013 8:59 am

...Canadian real estate is overvalued by about 20%. In the last five years prices have risen dramatically...


I hate generalizations like this. Talking about the "Canadian real estate market" is about as useful as talking about "Canadian weather."

Just as the weather in this massive country is made up of individual experiences depending on location, so is the housing market.

Generalizations like this are not helpful, yet we hear it all the time. In our market, prices have certainly not risen dramatically in the past five years!

On another note, I sure am looking forward to being the one Garth Turner makes fun of when he talks about Victoria next year... :roll:
Tim Ayres - Sooke Real Estate Professional
Personal Real Estate Corporation
Royal LePage Coast Capital Realty
(250)642-6361 (office)
(250)885-0512 (mobile)
Web: TimAyres.ca
Twitter: Twitter.com/TimAyres
Blog:WhatTheSooke,com
Email: Tim@TimAyres.ca
User avatar
TimAyres
KI(vic) Member
KI(vic) Member
 
Posts: 449
Joined: Thu May 29, 2008 4:57 am
Location: Sooke, BC, Canada
Region:

Next

 

Return to Café Island Parent

Who is online

Users browsing this forum: No registered users and 4 guests

cron


Site Sponsors
Island Parent Saanich Recreation