We've put this off long enough. We've been extremely discouraged by what's happening in our end of the market over the past month or two; I couldn't bring myself to actually take the time to sit and tally the results. I won't do another detailed accounting today either, I just don't want the tears.
Our criteria for houses is under $425K with a suite or suite potential. These are total numbers of listings and sales since late January.
90 total listings
60 total sales
sales to listings = 66%
5 taken off market (1 twice?); 1 re-listed and removed again
3 most recent sales this week went over list. When we started looking, we were told it was the condo market that was hot and houses weren't moving as fast or prices moving up as quick. This hasn't been the case in our minds.
Our criteria for condos is 2 bed 1 (or more) baths under $250K. Again, total numbers since late January.
159 total listings
76 total sales
sales to listings = 48%
15 taken off market; 5 re-listed
Hasn't been a recent over-list sale for at least one-month. Many price reductions (guessing at least 10% of total listings have had price reductions).
Some questions:
- Are people selling their condos and trading up into houses? If so, this may explain why there is much more action in the SFH market compared to condos.
- The rise in listing numbers widely reported through VREB and over at Victoria's Truth has been mostly listings over $700K. Is this a relatively small section of the market? I can't imagine that most of Victoria's homes are worth that much?
11 comments:
Don't get frustrated things are progressing along nicely for a correction. What your expierencing is that first time detached home owners are priced out of the starter detached homes and have gone to the condominium market. That puts pressure on condo prices, but eases up the detached home market. People in starter houses have not been able to build up equity in their homes, unless they bought two years ago. This is causing a slowing in the "trade up" market. Meanwhile, there is a lot of condo product still to hit the marketplace.
All that is happening is that the marketplace is setting up the economic dominoes. This is a "good thing" and what you expect to find at the end of a cycle.
Half a glass of wine and chant the following mantra -
Smith, Keynes, Friedman
Smith, Keynes, Friedman
Smith, Keynes, Friedman
Siobhan
What your expierencing is that first time detached home owners are priced out of the starter detached homes and have gone to the condominium market. That puts pressure on condo prices, but eases up the detached home market.
Except isn't that the opposite of what HHV just posted? It is the low-end SFHs that are moving and the condos that are sitting.
Having recently looked at this segment, my experience is that most $250k condos w/ 2 bedrooms are pretty dismal. That seems like a pretty marginal market, because if you go up 50k you can get something very nice. Or settle for a 1-br and also get something pretty nice. So I'm not shocked that they sit.
OTOH you can always dream of a big remodel of the $425k SFH, so folks are probably willing to move into those. Land is land.
BTW HHV,
I wouldn't get despondent. So long as you guys are renting at substantially less than 33% of your gross and investing the difference, you should be able to keep up with the market now that it has cooled. Even if it keeps going up, double digit growth seems pretty unlikely. And if the market flattens or declines you'll have an even easier time.
The trick though is that you have to rent cheap! Otherwise you have to count on a market decline to get in. Hoping for a decline is one thing. Planning for it is another.
When you are down just read some U.S. news and remember we are 12 - 18 months behind them.....
Don't hit the bottle yet HHV, look at all the $1 million properties that hit the hot sheet today. Half of them are major acerages,who sells huge lots like that ? Owners who know it's the top of the market. I'd say it was another 50 plus listing day...tick tock.
I would keep busy investing in some stocks. I am making a killing lately and enjoying every minute of not owning and having the ability to grow my down payment rather than being house poor with a ball and chain attatched to my leg and four walls.
vicguy -
I would just mention that investing in stocks at a high point in the market is not always a good way to "grow your downpayment", circa 2000.
*not investment advice*
;)
greg,
Wasn't meaning put the whole DP in the market,just a portion and yes the market is at a high but if you pick your spots and use a broker who knows his stocks and charts you can make money regardless what the major indices are doing.
Well, according to CIBC World Market, Canadian housing prices are set to double in the next 20 years.
I wonder if they also think the average income is going to double, because otherwise I don't know how most people will be able to afford anything. According to the RBC affordability index, the average BC family already requires around 60% of their monthly income to cover the costs of the average detached bungalow.
And as for the "alternative mortgage products" we've seen how well that's worked out for the US.
Of course, if you stuck your money in a savings account you'd only need a rate of 3.53 to double your money in 20 years, so maybe it's not such a great investment after all.
Did you see all those Reflections condos hit the hot sheets yesterday ? $450,000 for a place the size of my 2 bed apartment,what a joke.
Plus you get to breath in all the exhaust fumes off the main drag and the Costco traffic while you pant away on the roof top running track.
what's even more funny about that RE market set to double in 20 years, is up until that report it had only taken ten years to double in Victoria over the past 60 years...
If you read between the lines, the comment about it taking 20 years to double pretty much acknowledges the effects the baby boomer demographics are going to have in driving the market lower in that timespan.
Did I say it also pretty much acknowledges prices will go down in the process. For prices to double in 20 years without going down would require only miniscule increases each year, if the increases were linear.
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