Tuesday, October 12, 2010

Up to date market stats

These are the current VREB reporting area numbers via Marko Juras:

Month-to-date October 2010
Net Unconditional Sales: 161
New Listings: 323
Active Listings: 3,964 

October 2009 Totals
Net Unconditional Sales: 742
New Listings: 1,067
Active Listings: 3,219

If the current trend of 13.4 sales per day continues, total sales volume will be higher in October 2010 than in September 2010, yet still remain below 60% of last year's monthly total. Inventory is also falling, which is typical in the fall months, but remains stubbornly high - almost 20% more than this time last year. Days on market remains within 20% of last year's monthly average (assuming); there is no panic in this market, sellers are being patient as are the few buyers active today.

A must-read over at VancouverCondo.info today:
So the sideways prediction in home prices that homeowners are predicting? WISHFUL THINKING. The downward spiral the bears are predicting? The natural outcome of moral hazard.
If you understand that the government of Canada became the biggest subprime lender in the world, you are right. If you don’t understand this, you are the one we are all going to laugh at.
If you don’t understand that the government of Canada is actively trying to deflate this bubble (praying for a soft landing that never actually happens) you are the village idiot!

51 comments:

omc said...

What will be more interesting is the average price etc at the end of the month. My part of the market is dead.

Robert Reynolds - GBA said...

do those numbers include any sales over the long weekend? or should we see a slightly higher volume reported today and tomorrow?

HouseHuntVictoria said...

Not sure Robert. As I understand it they are the reported numbers as of 8:00am ish this morning.

Robert Reynolds - GBA said...

There was a post in the last thread mentioning Freedom 55. Being the insurance monkey that I am, I know all about this plan. The common usage of the term now just means that you retire at 55, rather than the more standard 65. But it really did start out as a financial plan that would get people to retirement at age 55.

Problem was, it was a stupid plan, and never worked.

The idea was to buy a BIG ASS Whole Life policy, first as insurance in case you croaked before 55, that way your spouse can retire at 55. Second, you would then save up a retirement fund inside the insurance policy thanks to dividends paid by the insurance company. So if you lived to 55, you can either borrow the money out, or cash in the policy and retire on that money.

The problem was the Whole Life policies were SOOOO incredibly expensive, that most people lapsed them and never got the insurance payout or the retirement fund.

As someone who makes my living selling insurance, and would make roughly 10 times as much selling a Whole Life as a Term policy. If you want to retire at 55.

Buy term, invest the difference.*

*Big generalization, your conditions may vary, Offer not valid in Quebec.

HouseHuntVictoria said...

For those interested, sales to new listings ratio looks very close to the final weeks of May 2010. I'm thinking that's unusual.

omc said...

I think things are a bit more bearish than we perceive. I am noticing that quite a few of the truly new listings are priced extremely aggressively, some considerably under assessment. A development property just returned to market, that supposedly sold in only 1 day (1992 FAIRFIELD RD). This is a prime 1/2 an acre on the oak bay border with a subdivision permit.

HouseHuntVictoria said...

Great article in the G&M today:

"8. Bear markets have three stages - sharp down, reflexive rebound and a drawn-out fundamental downtrend.

Market technicians find common patterns in both bull and bear market action. The typical bear pattern, as described here, involves a sharp selloff, a "sucker's rally", and a final, torturous grind down to levels where valuations are more reasonable; a general state of depression prevails regarding investments in general."


I'm thinking 2008 was the sharp sell-off, 2009 was the "sucker's rally" and now we're in the beginning stages of the long, final, torturous grind down to levels where valuations are more reasonable.

DavidL said...

@Robert Reynolds wrote; There was a post in the last thread mentioning Freedom 55.

Thanks for explaining the premise of this "London Life" policy. I just found it hard to balance out the message in these ads with the recent trend of baby boomers buying monster homes that they won't pay off for 20+ years. So much for freedom ...

@ omc wrote: I think things are a bit more bearish than we perceive. I am noticing that quite a few of the truly new listings are priced extremely aggressively, some considerably under assessment.

The sales in my PCS have picked up the past couple of weeks while the number of new listings and price changes have decreased. (I'm tracking "average" SFD between $400K and $650K with 1900sq ft., 2 bathrooms, 3 bedrooms in the core Victoria regions.)

Virtually anything that is selling is priced well below assessment. It looks like there are quite a few "distress" and court-ordered sales. I expect that some owners have pulled their house off the market and are hoping for a "brighter" spring.

@HHV wrote: I'm thinking 2008 was the sharp sell-off, 2009 was the "sucker's rally" and now we're in the beginning stages of the long, final, torturous grind down to levels where valuations are more reasonable.

I think that the "sucker's rally" is ongoing and won't dry up for another six months to a year. If the real estate boards and companies can manage get more "good news" stories into the MSM, there will always be a greater fool ready to jump into a life a debtitute (ya, I know it's not a real word).

On the other hand, if the politicians, financiers, etc. decide to be honest about our current economic situation (BC, Canada and abroad) - the rally will stop and the "torturous grind down" will commence immediately. I know, I'm expecting too much ...

Marko said...

"I am noticing that quite a few of the truly new listings are priced extremely aggressively,"

Can you throw me some examples?

omc said...

That makes sense davidL, I am looking at a different market sector than you. So it looks like the majority of sales are at the lower end of the market. The moneyed oak bay crowd seems to have left the building.

It isn't going to look too good for the averages.

omc said...

4224 OAKVIEW PL gordon head, 60k under assess

4529 JUNIPER PL gordon head, 160k under

2457 PLUMER ST South oak bay, 3 bed, 2 bath in culdesac that part of town

Marko said...

4224 Oakview - my friends bought a 10 year old home on Oakview as well - so far they have spent over 120k in renos......4224 Oakview looks similar, relatively new home but it is really cheap inside. The kitchen design and finish are home depot grade.

Even thought I think the home is crap it is a much better buy than a 500k teardown. The $1495 suite will more then cover the exra 235k.

4529 JUNIPER - Improvements make about 200k of that assessment. This is a tear down in my opinion given the location. Price is still above assessed value of land 970k.

2457 PLUMER - Sold 2.5 years ago at close to the peak of the market for 640k, so I don't see the deal in 639k.

Alexandrahere said...

DavidL...We have similar criteria as we have talked about before.
My criteria $375K - 775K, min 2 beds;2baths. Located in Vic,OB,Esq,SE&SW

Although I am seeing sales prices close to assessed value; most houses within this criteria are still selling for more than assessed. But the gaps are not $150K - 200K as were quite typical in the past.

Here are some recent stats:

SW Sold 492 Assm't 509
SE 498 466
OB 669 566
Vic 735 687
SW 383 417
SE 605 752
Vic 665 565
OB 575 595
SE 717 637
SW 499 434
Vic 710 574
Esq 425 456
SE 499 458
SW 630 650
SE 524 462
SE 695 710

Just Jack said...

From what I am seeing, about 33 of the last 135 house sales, or 1 in 4 homes, in the core districts have sold under assessed value.

The typical home is selling for about 6% over the assessed value. The assessed value as at July 1, 2009.

omc said...

Plumer was an estate sale 2.5 years ago. Pretty damned hard shape. It has been a long time since I have seen a 3 bed up, 2 bath home in that neighborhood, in move in shape for close to that. That one got an accepted offer first day. That price was, until recently, a 2 bed 1 bath price point.

I don't really know too much about the suite projects, but it seems that most 70s shacks with a small lot and a suite in that area are still around 600k. Case in point, that 40s shack you were talking about at $570k down on broadmead avenue. Low height, gun slot window suite. This one doesn't even have home depot finishing, they painted the old cabinets. Betcha you get a super high heating bill, and mold in the closets with that one. No garage either.

I agree, that oakview is one fugly house, but not having to replace all the services and having thermo windows and insulation does have it's value. It does have an over 9k lot too.

I am not interested in any of these houses, and these aren't selling prices. They are just asking prices.

Patrick said...

Could anyone analyze the one at 2032 Saltair? I'm curious why it is still there for the price.

omc said...

You never really know from looking at the pics. But, that house is still $50k over assessment. Similar houses (on Leyns and Wenman for ex) in that area have been selling under assessment. The market has fallen further since those sales too. That assessment looks high for the area also.

Mark said...

Coming to a Canuck City near you....this shit will never end :o(

Boomers' Shrunken 401(k)s Spark Interest in Reverse Mortgages

http://finance.yahoo.com/focus-retirement/article/111004/new-interest-in-reverse-mortgages?mod=fidelity-livingretirement&cat=fidelity_2010_living_in_retirement

Marko said...

"Could anyone analyze the one at 2032 Saltair? I'm curious why it is still there for the price."

The Coop Brok Fee is a flat fee of only $10,000 on this one ;)

Marko

happy renter said...

This is a little off topic and goes back to HHV's post about rentals from last week, but... Does anyone have a good sense of just how negotiable rent is these days? I'm looking at a 2 bedroom place in Fairfield for $1700/month and am curious what I might be able to get it down to. I know it depends on the landlord and how willing he/she is to bargain, but I wonder if anyone has anecdotal or personal experience with discounted rent?

HouseHuntVictoria said...

happy renter,

What do you think it's worth?

Make an offer. It is either refused, accepted or countered.

If you are going to make an offer, make sure you communicate why you think the place should be rented to you at that price.

From experience, some landlords will trade rent for a)improvements to their home by you, b) longer term lease agreements, c) perception of stability (i.e., you're the best renter they could possibly get etc) and d) because they understand they're asking too much to begin with.

If you can't make a compelling case using some of those variables, why would you be trying to negotiate the rent?

Ultimately, the deal between a landlord and a tenant is a business agreement. It's always negotiable, unless one of the parties is unwilling to negotiate.

Alexandrahere said...

Happy Renter: Common sense. If you have looked at similar rentals and you know that you can get one for somewhat less then say to this landlord, "I really like your place and I am a very good tenant. However I have seen other comparable suites that go for around $1575 per month. I would prefer this one though because it is slightly closer to my work. If you can rent this to me for $1575 per month, then I'll take it."

Rhino said...

Happy Renter,

If you look at the excess supply in rentals today its seems a lot is in the >$1500 a month range. There is a reasonably good chance you will be the only solid applicant. Use this leverage and offer $1550. If they don't negotiate, hopefully you didn't fall in love and can move on to the next one. I think you can get a really good deal in your price range right now...

Ryan said...

I did exactly what Alexandrahere suggested--find a comparable place and use it as leverage to bring the one you want down. In my case, I waited until both landlords had offered me their places before negotiating, but it could work whether you have a fallback option lined up or not.

Remember, it's all about leverage. If you're a good tenant then the fact you're willing to walk away gives you leverage. Smart landlords would rather have a good long-term tenant than make a few hundred extra off a tenant who will cause problems or move out after a couple months. The main thing is, you have to actually be willing to walk away from the deal. If you think it's worth $1550, say so. Don't fall in love with the place and then accept $1650.

Just Jack said...

If they turn you down on the $1,550, part on good terms. Complement them on the house, leave them your card and ...

"We're still looking for a place, so if you should change your mind in the next few days, please give us a call."

Alexandrahere said...

Nice sunny day today....but.....all is quiet on the realty front. They (the realtors), are probably all out enjoying the day and a round of golf at the Bear Mountain Course.

DavidL said...

@Alexandrahere wrote: Although I am seeing sales prices close to assessed value; most houses within this criteria are still selling for more than assessed.

Yes, your and my criteria are similar but I require a minimum 1900 sq. ft. and three bathrooms. I decided to "crunch" some numbers rather than rely on a "quick scan". Here's the most recently posted SFD listed in my PCS:

Asking|Assess| Sale | % |Address
==============================================
$499K| $456K| $425K|-6.79|713/715 STANCOMBE PL
$440K| $396K| $379K|-4.29|854 OLD ESQUIMALT RD
$649K| $650K| $630K|-3.07|5004 PROSPECT LAKE RD
$598K| $565K| $570K|+0.80|1858 SAN LORENZO AVE
$539K| $524K| $466K|+12.4|3365 BROWNING ST
$529K| $466K| $498K|+6.86|1015 LEEDS PL
$450K| $422K| $428K|+1.42|811 MCKENZIE AVE
$529K| $463K| $523K|+13.0|1245 TOPAZ AVE
$465K| $451K| $430K|-4.65|4061 QUADRA ST
$515K| $434K| $498K|+14.7|4186 CAREY RD
$600K| $557K| $589K|+5.74|3644 BRIDGEPORT PL
==============================================
$5813K|$5394K|$5436K|+0.78| ---- TOTALS -----

The selling price is averaging 0.78% above assessed value (July 1st, 2009) and is averaging 6.49% lower than the asking price.

DavidL said...

@Alexandrahere wrote: They (the realtors), are probably all out enjoying the day and a round of golf at the Bear Mountain Course.

Ha, ha ... or they are stocking up on rotten fruit for Garth Turner's "Houseageddon" presentation this evening.

omc said...

I bet the TC will be sending Carla to Garth's talk.

DavidL said...

Uh oh ... it looks likes someone is doing another DNS attack on Garth's Web site. I cannot imagine that it is a coincidence ...

Leo S said...

Uh oh ... it looks likes someone is doing another DNS attack on Garth's Web site. I cannot imagine that it is a coincidence ...

Let's leave the tinfoil hats at the door. Makes this blog look ridiculous.

DavidL said...

@Leo S wrote: Let's leave the tinfoil hats at the door. Makes this blog look ridiculous.

My point is that there are many people who disagree with Garth's perspective on real estate and investments. His Web site has suffered at least three DoS attacks over the past few weeks. Someone is trying hard to suppress his message. Whether you agree or disagree with Garth, me or anyone else - it doesn't matter as long as we all can enjoy "free speech".

Ryan said...

A website going down isn't proof of a DOS attack. Maybe he got linked on Digg or something.

Robert Reynolds - GBA said...

pft, Digg is a ghost town since V4

also reverse mortgages are a TERRIBLE idea.

Mark said...

This is priceless!

Ozzie Jurock, as quoted by Larry Yatowsky at yattermatters.com 8 Oct 2010 – “The much-covered RBC affordability index, which not surprisingly this week said Vancouver has the least affordable housing in the country, has to be compared against market reality. Vancouver house price have always been unaffordable when compared with the rest of Canada and likely will always be. According to a study at UBC, Vancouver’s affordability has been over 60% for some 22 years. Also RBC’s conclusion, that it takes 74% of a buyer’s income to cover a typical mortgage ignores the fact that most buyers are selling a home to buy one and have benefited from the increased equity. Thus, the average B.C. mortgage is likely not that much higher for most owners than anywhere else in Canada.”

Frikken RE pimps kill me! Where does he come up with this shit?

kabloona said...

Garth's site looks fine to me....

Mark said...

Why should you give up nearly two years of your life working to pay a realtor who is not even really helping you? That 6% commission means 6% of the 30 years of work it takes to pay off a house. That's 1.8 years donating your labor to realtors. Just find a house on your own, hopefully a house for sale by owner, and get a real estate lawyer by the hour to draw up the offer and complete the sale.

There are buyer's agents who really believe they are helping the buyer, but they're in denial about their conflict of interest. Author Upton Sinclair had a great explanation for this: "It is difficult to get a man to understand something when his salary depends on his not understanding it." The NAR (National Association of Realtors) has harmed America far more than terrorism did. Subconsciously, people know this, and that's why realtors are consistently rated the lowest "profession".

happy renter said...

Thanks for the advice, all! We're a professional couple and so should come off as excellent tenants. I'll do my best to sharpen my negotiating skills before I meet with the landlord tomorrow and I'll hope for the best.

DavidL said...

@Ryan and kabloon:

I actually know what I'm talking about.

Garth's site was down for about 30 minutes, starting at about 4 PM (PST). The web server was completely offline (100% packet drop) and the DNS for his domain was taking an average of 763ms to respond. I tested from multiple server locations from within Canada and the US.

DavidL said...

@Mark wrote: Just find a house on your own, hopefully a house for sale by owner, and get a real estate lawyer by the hour to draw up the offer and complete the sale.

I paid a total of $800 for legal and escrow fees, and to have a survey done when I bough my Saanich house in 2002. I saved about 6 months of mortgage payments by doing this ...

Mark said...

Well done David!
Now why can't other people figure this out?

I've never used a buyer's realtor to purchase a place and have owned 3 properties. I NEVER understood what they did to earn their commission and I know many people that have been screwed over as a result of a realtor's lack of due diligence on their behalf.

Perhaps with the new rules we will see more people wake up and realize they are unnecessary and save themselves some mortgage payments in the process :)

Marko said...

"I've never used a buyer's realtor to purchase a place and have owned 3 properties."

Do you buy privately listed homes or MLS listed homes?

Mark said...

Marco I have purchased privately once and twice through MLS and a "seller's" agent. Necessary evil at the time but soon to change :)

I factored in the typical buyer's agent's commission in my negotiated price (why let a realtor double dip (for doing NOTHING).

Mark said...

Looking over my updated PCS this morning and seeing a whack of product listed as OM (off the market). I guess people think it' going to better in the spring.

They will be kicking thmselves...

HouseHuntVictoria said...

"Marco I have purchased privately once and twice through MLS and a "seller's" agent. Necessary evil at the time but soon to change :)"

Mark, I've seen nothing that suggests this will change. I don't think the agreement between the Comp. Bureau and the CREA means that buyers and sellers will be able to circumvent "agency." In other words, if a home is listed with a full service agent, you'll have to buy through that agent.

omc said...

Another sign that things are not well behind the tweed curtain. There was a speculator, or group of speculators, that was buying up houses on Anderson hill (these on Island road). I guess things weren't pointing in a good direction, so they tried to sell off the whole thing as a possible subdivision. They are now trying to sell the houses off individually. Crazy asking prices though, higher than peak around here.

I have mentioned this part of the market is dead.

Marko said...

"I factored in the typical buyer's agent's commission in my negotiated price (why let a realtor double dip (for doing NOTHING)."

What makes you think the listing Realtor cut his or her commission to the sellers just because you negotiated an attractive price?

Mark said...

Marco, I have no way of knowing.....he did however tell me that he would be taking only his commission so maybe he was a liar? Go figure a realtor that lies ;)

I didn't care because I got a good deal on the property but I don't think they would have moved as much had we not figured in the the extra 3 and 1.5% (buyer's agent commiss)

But you are right there is no way of knowing in certain terms.

Mark said...

HHV....IF a home is listed with a full service agent, no but my hope is that people will wise up.

A lot of money being paid out for nothing and a lot people can't afford to drop that kind of $$$ these days....they will wise up IMO.

Personally for me it doesn't matter as I'm very content renting. IF I choose to buy again it will be for the price that I think is fair. IF the seller thinks that it is also fair then we will have a deal, if they don't I will walk. it's that simple....too bad more people don't get it.

Travel Girl said...

Did anyone go to see Garth Turner speak? If so, how was it?

deirdre g said...

I can see that you are putting a lot of time and effort into your blog and detailed articles! Will be back often to read more updates!

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