Friday, March 16, 2007

Friday Low-end Market Watch

This will be the first time we've done numbers up week over week. So if they seem like insignificant changes it's because the previous two 'market watch posts' have used 3 and 2 week periods respectively. From here on we plan to do this up weekly on Friday mornings. I may do a low-end market monthly re-cap on the last day of the month in March?

We're only watching low-end houses; what we deem to be affordable anyway, criteria below.

[criteria is suited, or suite potential, under $425K in SW, SE, Vic, Langford, ESQ]
Total houses: 71 (66); 5 new listings, significant drop from 18 for last two-week period

Number sold: 35 (30); 5 above previous

Sold above asking price: 1 (2); again, I counted sold at asking as above, I've noticed that anything in the CedarHill neighbourhood in this price range is fetching above asking. This one was a 'handyman special' that sold for $25K above, and almost $400K

Sold below asking price: 4 (11)

Average days on the market: 37 (27); 3 houses with over 100 DOM sold this week

Listings to sales ratio: 71/35 = 2.03 months inventory (66/30 = 2.2); slight decline

[criteria is 2 beds, at least 1 bath, under $250K in SW, SE, Vic, Langford, ESQ]
Total condos: 109 (96); 13 new listings, slight decline from last 2 weeks 29 new lists

Number sold: 38 (32); 6 above previous week; 1 taken off market

Sold above asking price: 0 (5); again, I counted sold at asking as above

Sold below asking price: 6 (8); sales down from last week by 7

Average days on the market: 24 (23); slight gain

Listings to sales ratio: 109/38 = 2.86 months inventory (96/32 = 3) I'm confused by this outcome. If we have 13 new listings and only 6 sales, inventory should climb right? Not by this math... there must be a margin of error, or I'm completely of my math rocker, which wouldn't surprise me in the slightest.

Our Thoughts: maybe one week's worth of numbers isn't enough to extrapolate anything out of. There were quite a few price changes this week. One dandy downfall from $245K to $200K; still unsold. Our gut is telling us that the low-end condo market is cooling rapidly. The first couple of weeks of March is proving nothing like February. We think the market is speaking. Even our realtor is saying, don't worry, there's no pressure to buy anything, listings will be on the rise in April and May and the selection will get better.

The CedarHill, Maplewood and Mt Tolmie neighbourhoods are still moving. They're nice places to live and most homes are priced closer to $500K, so the ones we see are either experiencing some price compression or are anomalies in this market. Langford used market is slow. This is probably because you can buy new for the same price (you just get a much smaller footprint and lot).

Interesting topic at Victoria's Truth this week. We'll be reading it intently. Seems like a lengthy comments section will grow out of it!

9 comments:

Vicguy said...

From my scan of MLS for the first time in a couple of weeks I have resolved myself to not plan on buying for a couple of years. I cannot believe the total crap for sale at the $400,000 level and under that hasn't had a reno done in 20 years easy. It's like watching That 70's Show with the decor in these dumps.

Even if I had a 50% down payment I would not buy. Just another convincing day where it's evident this province is so out of touch with reality.
I'll keep investing and watch my money grow,in couple of years the $500,000 houses will be back to $300,000 where they should be in the first place then I will step in and not a day sooner.
Sorry if this comes off like a rant but it is,lol.

HHV said...

No need to appologise for rants on this blog.

Took a hike up top of Mt Tolmie tonight to remind myself why I choose to live here and not somewhere else. Sure is a beautiful town at dusk.

Roger said...

vicguy,

I saw a 2 BR Oak Bay condo in a building where I used to rent a few years ago listed on MLS for 539K. After 13 days on the market they had to drop the price by 50K (yes fifty) to 489K because another one in the same building came on at 479K. Both are still overpriced 1982 units but now the fun begins. I gotta see the end of this one.

Listings are coming on the market at a pretty good clip. If you want a site that is updated regularly go to: http://scottpiercy.ca/hotsheet.html

If you want to make a good investment this year purchase some "crying towels" for resale later this year. They should be in high demand by the fall.

HHV said...

Roger,

I always eagerly await your comments. Full of great info, links and just a wee bit o humour... Thank you for chiming in!

Roger said...

hhv,

Thanks for the post. I try to share info if I can because I get a lot from your site and the Victoria Housing Blog.

I have a suggestion for a topic. The subject line would be "Who is buying these new high-end condos" If you look at the TC and Vibrant Victoria you seed ads for all these under 1000 sq. ft condos that start at 400K and go up to around a million. A number of them are in Vic West where they are building a sea of concrete between the railroad tracks and the waterfront. I saw one up for rent for $1700 and the identical unit is up for sale for $489K. That rent only covers about half the PIT and condo fees. Who is buying this stuff?? Maybe some readers have some anecdotes and personal insight they want to share. Curious minds want to know!!

Roger

hhv said...

Roger,

You've given me a challenging research project that will provide ample distraction from the paper I must write this weekend. Consider it done, I'll get on it.

Vicguy said...

Not sure if this thread will get lost with the others now created but thanks for the link roger.

Very intersting on the Oak Bay condos, that is a huge decrease. You gotta wonder where some of these agents heads are to be that far off the target and yes it still sounds very overpriced, I eagerly await the higher sales of crying towels,lol.

hhv said...

VicGuy,

"Very intersting on the Oak Bay condos, that is a huge decrease."

I've watched a ground floor condo in a dirty building on Pembroke, across from the Crystal Pool, go down from $245K to $199K in less than two weeks. I don't think its the agents. If they don't list the property, they know someone else will. They probably realize that it's best to give the vendor the price they want but have an agreement that if the price scares people off, or another unit in the area/building that is similar comes on for much less, then a price change will happen.

I'm guessing that with the slump in sales and flattening prices, alot of agents are getting hungry. Better to get the unrealistic sellers to sign the line and deal with the aftermath than let another agent get the listing.

Vicguy said...

The vendor in that building obviously knows if he tries for top buck he won't even get any lookers in that area,in other words take the money and run. In a market correction those units won't even get a consideration even at that price.