I was at a BBQ last night. A Realtor I know socially arrived a bit late who had been closing a sale getting contracts signed etc. We started chatting and I made some references to crazy new condo prices and even more ridiculous entry-level SFH prices. Throughout the conversation I made a couple of references to the status of ownership. I received this in reply: "I don't own my own place. Why would I own something that would cost me three times what I pay in rent?"On new condos: "I've sold a couple. I try and stay away from them to be honest, I want repeat customers not people who will want to sue me. Let's just say we're in for a really big mess in the next decade. In the 1990s it was leaky buildings. I don't think the new stuff will leak. It's got pretty good breathability with the new code regulations. What will be the issue is this: they've thrown them up so fast that quality is a huge issue. Shutters, The Wave, Railyards, all junk. Some job sites have 1 ticketed journeyman per twenty guys working on the place. The stuff is happening so fast that the inspectors can't keep up with checking credentials. Anyone who had a $10/hour job can get on at these places for $16-$20/hour just by showing up with boots, a hard hat, some hand tools and a pulse. You're going to see a lot of unhappy buyers complaining about poor workmanship."
On flipped homes: "You see a lot of them for sure. I haven't sold any. My clients aren't interested in them so much. I'm selling a lot of land these days, mostly out of town. People with money are doing custom stuff rather than buying existing properties. I don't know many out-of-towners who want 50 year old homes with problems. If they're retiring here in the future, they're happy to move to Mill Bay, Shawnigan or the Peninsula and build a dream home. Flipped homes have a worse reputation for quality than the new ones, and they're getting to be bad enough."
On the state of the market: "Do you think Realtors pay attention to that stuff? Economics, sales statistics are what we get in our weekly updates from the agencies that we don't read. We're trying to sell. That's what we do. Not analyze."
On the number of Realtors in town: "1200 give or take a few. It's a tough business to make a buck in. Sink or swim. Every boom year we get 500 newbies who come in thinking homes sell themselves. Every flat year we get 500 newbies leaving shaking their heads."
14 comments:
You gotta great memory HHV or you were wired,lol.
Interesting stuff, these guys see some of the new stuff at different points of construction and they know full well what crap quality goes into these places,great to see the confirmation.
We also now know it is all about sales not analyzation so therefore there is no one looking out for you but yourself,the agent doesnt care if the market tanks after you buy.
hhv -
sounds like a straightforward guy/gal. Maybe s/he's the Mike Morgan of Victoria. Should see if s/he's willing to go out on a limb and say that stuff with his/her name attached to it....
VG,
no wires... that's paraphrasing on my part, so let's assume there is some flexibility in my choice of words. Realtor in question of course has no idea I'm blogging this.
I've been quietly working said Realtor for a while to try and set up a "Chipman's area" here in town so I can do daily list/sales tracking publishing. It may happen... the idea was warm last night, but that could have been the wine talking.
I feel unethical taking the info and publishing without knowledge, so I'm working up the guts to "come out" and just ask for what I'm looking for. That may require more wine as well.
i've been in and around all three of the developments the realtor mentioned while they were going up, and he's right, the stuff being built these days goes up fast and cheap without any attention to quality. the wave building is maybe the exception there, though - i found that there was actually some attention being paid to the details of construction there. the finishing on the units is really good there comparatively as well.
this realtor sounds like the kind of guy we need more of making statements on the record (as greg said), and i think it's fantastic that he admits that he'd never buy in this market. you know things are bad when realtors wont even touch them...
vg said
"....so therefore there is no one looking out for you but yourself,the agent doesnt care if the market tanks after you buy."
Are you surprised? Realtors are in business to make a living, like veryone else. If a buyer doubles his money, does he ever think of sharing his nest-egg with the realtor who SOLD him the property?
On the other hand, nobody holds a gun to any buyer's head, forcing a purchase. So, when markets tank, why should a realtor be responsible for losses? I am not one, and I detest realtors (slimy ones), but let's play fair.
I cannot count how many bumbling morons are showing off about having paid the highest price EVER on a street. What is there to be proud of, in that situation? The SELLER should be showing off , instead, for maximizing his selling price.
I feel sorry for many innocents who'll lose after the bubble-bust, but not everybody deserves sympathy.
Recently, on another post, someone was boasting about buying a house through a bidding war. Apparently, the seller jacked up asking price within days of listing, as there was some interest. In the buyer's own words: "The price went up $20k, then we offered a further $10k, so we could be sure of getting the house. We paid 430k over asking, and I DON'T THINK WE PAID TOO MUCH...." What a jackass!
Sorry, I meant "we paid $30k, and NOT We paid 430k over asking"
vg said
"....so therefore there is no one looking out for you but yourself,the agent doesnt care if the market tanks after you buy."
"Are you surprised? "
anon,
Not suprised in the slightest,but I am sure there will be a few who are since every agent I have seen interviewed on TV keeps saying over and over "I am here to protect my clients interest". These agents are the same ones making the idiot statements such as "the solution to affordability is a 40 year mortgage and some
"creative" financing" and there are alot of suckers falling for it cause I know a few.
I am sure there may be a few good guys in there but they are few and far between.
Please read this article from Moneynew.com
http://www.newsmax.com/money/archives/st/2007/6/25/154818.cfm?&PROMO_CODE=364F-1
I cannot figure out to this day how people (mainly RE agents) think Victoria is untouchable.
Here's an interesting interview on Victor Adair's site,click on the video interview with Doug Casey,makes a few references to Vanouvers real estate insanity.
BTW,I'm not pumping gold or gold stocks,though I may lean that way in the coming year if the charts point me there.
http://www.victoradair.com/
http://www.freakonomics.com/blog/2007/06/28/another-look-at-sellers-concessions-in-real-estate/
An interesting article on the practice of cash-back sellers concessions that is happening down the US. Anyone know if this is happening (or legal) here in BC?
Here's a link for the article I posted above, so you can click to it more easily: Seller's Concessions
it's exactly what's going on with the reflections development sales scheme in Langford
been going on in the car industry for almost a decade too
The new Reflections radio ads are thoroughly nauseating. "Kiss the landlord goodbye" and some other line about how exciting it is to get a year at $900 per month,what a joke,despearation written all over it.
Reuters:
Real Estate: Two-thirds of investment managers showed little enthusiasm about the Canadian real estate sector. "There has been so much publicity regarding the glut of supply and high-risk mortgage lending problems in the U.S.," said Hicks, "and with the strong likelihood of higher financing costs, both south and north of the border, managers are more bearish about Canadian real estate."
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