MLS numbers courtesy of the VREB via Marko Juras. These numbers are for the Victoria Real Estate Board's reporting area, including Sooke, Shawnigan Lake and the Gulf Islands.
Month to date February 2011, last week's numbers in (brackets)
Net Unconditional Sales: 195 (78) + 117
New Listings: 637 (334) + 303
Active Listings: 3,435 (3,312) + 123
Sales to new listings ratio: 30% (23%)
Sales to active listings ratio: 6% or 8.8 MOI approximated (2% or 10.6 MOI approximated)
February 2010 totals
Net Unconditional Sales: 621
New Listings: 1,460
Active Listings: 3,280
Sales to new listings ratio: 42.5%
Sales to active listings ratio: 19% or 5.3 MOI
Saanich East Single Family Home market snapshot
Saanich East continues to be an area of high demand for SFHs:
Month to date February 2011, last week's numbers in (brackets)
Net Unconditional Sales: 195 (78) + 117
New Listings: 637 (334) + 303
Active Listings: 3,435 (3,312) + 123
Sales to new listings ratio: 30% (23%)
Sales to active listings ratio: 6% or 8.8 MOI approximated (2% or 10.6 MOI approximated)
February 2010 totals
Net Unconditional Sales: 621
New Listings: 1,460
Active Listings: 3,280
Sales to new listings ratio: 42.5%
Sales to active listings ratio: 19% or 5.3 MOI
Saanich East Single Family Home market snapshot
Saanich East continues to be an area of high demand for SFHs:
- 36 homes sold in January 2011, exactly double the number of Victoria and almost 40% more than it's nearest rival of Langford
- That's also 7 more units that sold in SE in January 2010
- The median price of a SE SFH was $630,000, up 1.5% from $620,000 in January 2010
- Average price ($630,115) was down slightly year over year ($640,107) and 6% below the 6-month average ($666,286)
- The "luxury SFH market" in SE recorded 4 sales above $1 million
- 58% of SFHs sold in SE were recorded below the January 2011 average reported price for the area
- 33% of SFHs sold in SE were priced between $650,000 and $900,000
- Saanich East sales amounted to 20% of the total VREB dollar volume transactions, 9% more than the next highest area, Victoria.
| January 2011 | January 2010 | |
| Days on market | 71 | 48 |
| Price to ask ratio | 97% | 99% |
| Sales to new listings ratio | 37% | 44% |
| Sales to active listings ratio | 17% | 29% |
74 comments:
In May 2010, a coworker of mine bet our supervisor $100 that on average, single family house (SFH) prices in Greater Victoria would drop by 30% within three years. I was talking about this bet today with my supervisor, and in by his and my shared estimation - SFH prices have dropped by about 7% in the past year. (This doesn't mean that the average or median price has dropped by this specific amount - it means that it a house were put up for sale in May 2010, it would have sold for about 7% more.) He asked if I want to join the bet, add $100 in support of my coworker's estimate of a 30% decline in prices for SFH by May 2013.
I believe that SFH prices will return to 2005 sale values. However, I think that it may be 2014 before prices get this low.
What do you think?
(Before someone thinks that my estimate is just "wishful thinking", I am already paying a mortgage on a SFH that I purchased in 2002.)
DavidL, I posted a number of weeks ago that I work with a client in a place where buyers have been on strike since May 2008 (almost three years) and sales volumes have been consistently below 50% of 2005 to 2007 levels other than the odd month. Real estate prices in this city are down 25% to 30% since peaking in May 2008. Most sellers continue to believe the market is poised to turn around, but buyers are on strike and see nothing but further price declines. But even with minimal buyer presence these price decreases do not appear to come quickly as sellers just wait it out (most getting nowhere). If this experience is representative and if buyers do back right off in Victoria, it appears a 10% per year reduction is about the most one can expect. The wildcard of course is interest rates. If they scream upwards, price declines could be quicker. The challenge with Victoria buyers is I suspect they will not back off as much as I have seen elsewhere unless mortgage rates force them to. If prices drop 10-15%, do we see more buyers start to enter the market again thinking they are get a deal thereby dragging out the declines?
Reid,
I suspect that many buyers are convincing themselves they're getting good deals right now. With the reported numbers showing zero declines, even increases, yet buyers out there paying 5% or more less than they would have a year ago for the same product, their stories may be providing other buyers with motivation to go find their own "good deals."
@Reid
where?
Rose, I would rather not provide the name of the city, but it is in the BC Southern Interior and its real estate market climbed strongly through early 2008 mainly because of non resident buyers particularly from Alberta. Most of those non resident buyers have backed off since and as such demand has been way down for almost three years. Prices IMO should be down 50%, but home owners still think they are sitting on gold and that the market is about the turn back up again so they resist lowering prices.
The average price of a single-family house — the strongest seller in this region — year-over-year slid 6.4 per cent to $603,401 in January, from $644,678 the same month a year earlier, Victoria Real Estate Board figures show.
Source: TC
I have to say the realtors are masters at muddying the water. Yesterday they released a BS report that prices were up 11% in BC, but didn't explain why. The reason of course is that all other area, except Vancouver, have seen significant drops in sales YOY. vancouver has seen drops in prices and volumes also, but not as much as other areas. I have a friend who bought a townhome fairly recently, after the prices dropped, In Vancouver. According to him prices are still steady, to slowly declining.
Of course this was to counter that they had to release today that prices decreased here. They have Muir spouting unsupported garbage from probably different dates and methods.
If I conducted myself anywhere as poorly as these clowns they would take my credentials for unprofessional behaviour.
@a simple man wrote: The average price of a single-family house ... slid 6.4 per cent to $603,401 in January, from $644,678 the same month a year earlier.
Unfortunately, averages do not always give a clear picture of what is really going on. From reading other comments over the past few months, it seems like the consensus on this blog is that a "better" quality home is now being offered for the same amount as six months ago. For example, six months ago $600K might buy a 15-year old house of 2200 sq. ft. in a particular neighbourhood. Now it might buy a 10-year old 2500 sq. ft. in a nicer neighbourhood. Both sell for $600K, so the average sales prices does not change. This is where a housing price index can be so useful, but is not offered in Canada (yet).
Interesting feedback everyone. Thank you.
Whoops!
The link to the S&P/Case-Shiller Home Price Indices ought to be: http://www.standardandpoors.com/indices/sp-case-shiller-home-price-indices/en/us/?indexId=spusa-cashpidff--p-us----
DavidL;
I completely agree. You can buy a lot more house these days as compared to a year ago, which is in no way reflected in the mean price drop. However, the fact that vreb would admit to a drop YOY it is a step in the right direction.
The real drop is yet to come...
Underwater mortgages in the US by percentage in large cities.
In response to the 30% price drop speculation....long shot in my humble opinion. We are talking a 600k home coming down to 420k, probably not going to happen.
"SFH prices have dropped by about 7% in the past year"
- I don't know, have they? Not too many deals out there. Random variability in prices is like +/- 5% every month so is 7% even statistically significant?
Marko, can a 30% decline happen in Victoria? The answer will be depend on interest rates. A buyer today pre-approved at 3.6% for five years and earning $100,000 will be allowed to borrow about $550,000 based on a 35 year amortization. If interest rates rise to 6.0% and with the new 30 year amortization rules that same family earning $100,000 will only qualify for $386,000, exactly 70% of what they could have borrowed in the initial example.
My research has shown a very high correlation between borrowing capacity and prices on the BC Coast over the past 20 years. If this research holds true in the future (which I cannot see why it will not) then a 30% drop in prices is very likely to occur if discounted five year mortgage rates rise to or above 6.0%. So the real question IMO to how much Victoria real estate will drop in the coming years has more to do with how high mortgage rates increase in the coming years.
Is a 30% correction possible, absolutely!
Are we going to see 6% five year discounted mortgage rates again? I have no idea.
Greater than 30% losses have occurred across the straight in Seattle and they have major industry like Microsoft, Being, Starbucks...we depend on Gov't and people coming to smell our flowers in the spring and summer.
30% is very possible here.
What is funny is that one of the true believers I was talking to the other day was saying that our real estate is like Seattle's and doesn't fall.
My unofficial, BS observations say that it is usually a bit of a sellers market until mid March. Inventory is low. We won't know what the market will bring until April.
The seattle situation really is fascinating. Another town where real estate never goes down, and previous corrections had been relatively mild, so everyone thought it never would. I don't think 30% is out of the question for Victoria.
I agree with Marko though that it hasn't clearly declined yet. In the fall it was a bit cheaper than the spring, but the new assessments have buoyed some prices. Pretty much flat from my view.
How much of the local housing economy is tied to contractors? In other words, when work slows down for them how will this effect the housing economy here? Driving through a lot of places I see so many contractor trucks parked in the driveways of nice houses and not during business hours. Nowhere is it more prevalent than on Bear Mountain.
and how many private school kids do you think will be attending public school next year? I have seen quite a few this year already make the move across...
money is getting tighter out there. Even in Oak Bay. Gasp. Chug tea.
There is a Cdn house price index: http://www.housepriceindex.ca/ Does not include Victoria.
"In response to the 30% price drop speculation....long shot in my humble opinion. We are talking a 600k home coming down to 420k, probably not going to happen."
And if we all just keep saying that long and loudly enough if will be true!
Because it hasn't happened anywhere else with ridiculous prices and great weather and where "everybody" wanted to live. Oh, gosh, no.
@Reid
"A buyer today pre-approved at 3.6% for five years and earning $100,000 will be allowed to borrow about $550,000 based on a 35 year amortization. If interest rates rise to 6.0% and with the new 30 year amortization rules that same family earning $100,000 will only qualify for $386,000"
So if the carrying costs for both these scenarios is, for example, $1500/month, what is the long term impact to the owner - which scenario is better a)lower price at higher rate or b)higher price at lower rate. Keeping in mind that the equity in scenario b will presumably drop when prices drop. I guess even with the higher rate (a) is better because after 5 years you've got more equity (all other things being equal between the two scenarios)?? Is the "other things being equal" a reasonable assumption?
The winner, as is in everything else in life, is a lower price.
You don't get something for nothing in life. When you are buying at the high price and low interest rate you may have the same payment, but you are taking on far greater risk.
If prices are steadily increasing at near double digit rates, you are willing to bet on that risk, as the level of risk is low. And past performance shows that this was a winning scenario - the more debt you took on - the greater was your return. You could have your cake and eat it too.
But today is not yesterday and past performance is not a guarantee of future rewards.
Affordability has crested and a small change in interest rates, unlike a few years back, has a direct impact on prices. In otherwords, we are at the top of the price ladder. All our chips are on the table.
Without appreciation, risk increases dramatically. The odds are that at renewal time you will not be able to afford the home or sell the home for what you bought it for. So for the next three or five years you will be paying rent to the bank and taxes to the city. At the end of the term, the bank gets the home back, collects from CMHC, and you're into bankruptcy and possibly any others who co-signed your mortgage.
That's risk.
a simple man, it is a small community. I know of a few people that earn far less than my wife and I, who bought way over their heads at the peak and who are now transfering their kids to public school from private school. At $15k/year tuition, private school is only for the elite and some people like to pretend.
Catherine, if we had mortgages like the US where you can lock in a low interest rate for 30 years then the difference between your two scenarios is less dramatic, but in Canada you should always buy real estate when interest rates are high even if the short term payments hurt more as when interest rates drop prices historically rise (just look at the last decade).
The problem many people today I find is that they are too focused on the payment and how that compares to rent and less concerned with how much money they are borrowing. Buy a house for the long term when interest rates are high and your payments are going to drop as you get older (whereas rents will increase over the longer term) and your home is likely to gain value and this will always beat renting over the long term even if in the first five years renting was cheaper because of the high interest rates.
That is my advice for what it is worth, but this means one needs to remain on the sidelines for a few more years.
The further we get away from the 2007/2008 peak I think the lower the chances of large price corrections.
In Canada as a whole I think we are in a pretty good situation. Not that the TSX is a great gauge but it has clearly outperformed the Dow in the last few years. 3 out of my 5 core holding (all CND large caps) have increases dividends two years straight as of this month.
Yes, there is always the possibility the housing market in Victoria could correct 30%. From an investment standpoint, I certainly wouldn't short it.
As far as contractors, I'll say it for the 1000x time. THERE IS AN ABSOLUTE shortage of trades. When there was the boom you had a lot of unskilled, unqualified people working in the trades. The slowdown simply weeds out unskilled people with a poor work ethic. Most successful trades people I know are the kind that provide good quality and work Monday - Saturday. No BS. Still busy.
I was just getting my haircut the other day and the owner of the barber shop is trying to get an Italian barber into the country as a skilled immigrant. Can't find anyone locally willing to work 5 days a week, full hours, who can provide quality.
On the other hand I have a friend who is a civil engineer and cannot find a job in Victoria, three job offers in Fort Mac. Go figure.
So, what are savvy investors doing today.
Case in point. Back in October 2005, a ten acre property was purchased, in Sooke, with the idea of severing several lots. The investor paid $560K back then.
Early this year, that same property came back on the market, still not developed. The difference today is that there were not many investors willing to take on the risk of a residential development. The property this month sold for $400K. A drop of 28 percent.
Risk, risk, baby, baby.
What every happened to the rapper Vanilla Ice anyway?
Marko, you have to rock the coke machine several times before it falls over.
Court ordered sales or other duress sales that happen today had there seeds sown 2 or 3 years ago. They are just starting to sprout today. Two years ago, there were few court ordered sales because prices were going up and you could finance the home with a different lender. Today, you can find court ordered sales, peppered through out the different income groups.
Well, the civil engineer should put on his resume that he will work for $36,000 per.
And the barber should advertise for someone locally and offer a $100,000 a year.
Of course, I'd be getting my haircut by engineers then.
Actually quality has no place in today's world. Your Barber would have better luck, hiring someone with less skill and more cleavage.
China is a super power not because it produces quality. It's a super power because it has nice looking junk.
Marco
"3 out of my 5 core holding (all CND large caps) have increases dividends two years straight as of this month."
I think you forgot that this is being fueled by unprecendented stimulus (read: debt) and low rates both which will end.
"When there was the boom you had a lot of unskilled, unqualified people working in the trades"
Who were making good money nonetheless and now they are not.
llll
Higher interest rate and lower purchase price is almost always better than higher price with lower interest rate.
For example:
$100K @ 4% avg rate over 35 years = $185,136 total
$70K @ 6% avg rate over 30 years = $149,893 total
This assumes prices fall 30% with an interest rise of 2%, something which, while appearing likely from the math, is all but guaranteed.
This also assumes interest rates are averaged out over 35 years. Which they won't be. It's only over the short term that the lower interest rate is "saving" money over the higher interest rate. Inevitably, after about 5 years of ownership or so, the two will be paying the same making the higher purchase price option even worse.
"I think you forgot that this is being fueled by unprecendented stimulus (read: debt) and low rates both which will end."
I really don't understand the arugment?
If I buy td.to for $40/share, collect two years worth of dividends and sell for $80/share why it would matter what fuelled it from the perspective of an individual investor?
If you are so condifent that it will end I am assuming you are shorting Canadian large cap companies as we speak?
Marco,
You are using your stock gains as evidence that Canada is doing pretty well and this was to support your argument that house prices will not go down. That was your point.
Your looking into the past stock performance to project the future real etate performance. hmmm.
My argument is that things are not that rosy for the future (not the past) and the debt party will end.
I think stock market gains are at least in some part a reflection of the Canadian economy.
Marko, Canadian stocks have done well because most companies cut costs (i.e. people) in 2008 and 2009 and most have not rehired back those employees, so margins are better. This combined with people chasing yield given the rediculously low interest rates has help drive stock prices higher.
In late 2008 and 2009 companies were the only ones reducing debt. They had to as the banks were on all over corporate Canada to slash debt and costs. Unfortunately our citizens and governments did the exact opposite and continued to borrow and lever themselves.
Housing markets are more dependant on employment and rising incomes and it is a fact that unemployment numbers remain too high and few people are seeing their incomes rise. Rising stock prices has done little to improve employment or incomes, so they will have a limited impact on improving housing affordability.
Rising interest rates will slow down the real estate market in Canada regardless of whether the TSX is at 12,000 or 17,000.
I think it also has something to do with the price of oil & other commodities.
Well, one of the properties that I have been watching for the last 3 1/2 years just sold. I remember the day I jogged past it, when they first put the sign up. 6 bedrooms, 10 bathrooms, 7000 finished square feet and a half acre on Rockland. A little weekend getaway cottage for a Vancouverite who just sold their Yaletown condo. Or a place to kick the moo off your boots for an Albertan urban cowboy.
I knew it was going to be a tough sale. The property went up 6 times in value since they originally bought the home in 1980 for $280,000.
This is a place that deserves a lot of kids playing in the house and yards. I figured that the Mrs and I would have to be really busy bunnies trying to fill up all the bedrooms. Sadly, the best money maker for this property would be to destroy the house and put up a methadone clinic.
Alas, Wally and Beaver Cleaver will never walk out the front doors again. I knew something was up when Eddie Haskell became a top selling real estate agent.
Back in 1980, the average Rockland home was $45,000, so they bought the property then for 6.2 times the average home. Really big bucks for those days.
Today the average Rockland home is $800,000, and the new owners bought at 2.1 times the average neighborhood home price. Big homes are bad investments just ask Eddie or anyone on Bear Mountain.
Certainly the longer the market is flat, the less the decline will be if/when it arrives. Incomes growth is still positive and fairly strong, so the fundamentals slowly improve if prices are stable.
I think the key will be this year. If prices are still flat this time next year, having weathered rule tightening and mortgage rate increases, the decline just might not happen at all.
I really don't think this will happen, but I think it's too early to tell right now. This cycle of credit tightening is new and we don't know how the market will react. Could be that mortgage rates go down again as well if the economy reacts badly.
I'm always surprised when people say that they don't expect properties to come down in price by ten or 15 percent - when they already have. You're just not looking in the right places.
Like on Hackamore Drive in Metchosin. Sold back in July 2007 for 1,704,000. Sold again this year for $1,400,000. That's a 17 percent drop in four years.
The properties at the margin are the Canaries in the gold mine. Prices are being chipped away and eroded from the outside and lower price are moving to the urban centers.
So the best advice for someone wanting to own a million dollar home in Victoria is to buy a two million dollar home - and wait.
"15 percent - when they already have. You're just not looking in the right places."
I just also saw a property sell for 2.45 million; it sold in 2009 for 1.83 million...
I showed a town home at dockside green that just sold for 355k, neighbour with same floor plan paid 465k April 2009.
A lot of these are not a true reflection of the overall market, rather people overpaying, or getting good deals.
I show about 10-15 properties per week and I really am not seeing a 15% drop.
If you cherrypick, you can make the potray the market as up or down.
@ Just Jack wrote: ... they originally bought the home in 1980 for $280,000
Just imagine how much they could have saved is they waited until 1981 to buy (or any time through 1986). Prices kept on depreciating over those years ...
So the best advice for someone wanting to own a million dollar home in Victoria is to buy a two million dollar home - and wait.
Now that is very funny! :-)
@ Marco wrote: I show about 10-15 properties per week and I really am not seeing a 15% drop.
So what are you seeing? A 10% increase, a 5% drop? What is you estimate of how prices have changed over the past year or six months?
This isn't "cherry picking". This is showing that the market is moving to one that is shallow and dysfunctional.
This is how markets start to fall. Eventually, the anomalies become the market.
So, let's just say the Canary is resting - not dead.
Apologies if this has been posted already, Mish on "It's Different Here."
http://tinyurl.com/4npft5j
"So what are you seeing? A 10% increase, a 5% drop? What is you estimate of how prices have changed over the past year or six months?"
I think a certain segment of the condo market is down 10%, luxury segment more so....
Brand new homes I would say are at record highs...few weeks ago we had an 800k sale on Players Drive! 880k for the one on Davie Street, plus multiple in View Royal for 800k.
Lot prices I would say are also at all time highs.
600-900k resales, older than 5 years I would probably say, I don't know, down 5-10%?
I mostly show homes in the 400-600 range and to be honest it seems to be pretty flat.
Individual transaction is far more important than trying to evaluate whether the market is up or down 5%.
For example, take a look at what condos on Speed Street went in 2007 and what they are sell for now, then compare with some of the buildings in Langford. Most people who bought a condo in 2007 in Langford are barely breaking even or losing money, while if you bought on Speed Ave you are up in excess of $50,000 - $60,000 on a two bedroom. Both purchased in the same market.
"If I buy td.to for $40/share, collect two years worth of dividends and sell for $80/share why it would matter what fuelled it from the perspective of an individual investor?"
That's if you are smart enough to time the market. The reverse was also entirely possible and cought most canadians by surprise. TD in 2007 reached $75/share, in Q1 2009, it bottomed just below $40 - a price not seen since 2003. Most retail investors (that's J6P), are aweful market timers.
Yes the TSX reached 14,000 again, but how many TRILLIONS did the US Fed have to print to stimulate the economy? Didn't this put Canada into a 5 year deficit (if you believe the gov will actually pay it out in the time frame).
The TSX could go to 50,000 - but then oil will be $500/barrel and gold at $5,000/oz, and 100-500 million people around the world will have starved to death due to massive food inflation - not to mention another 20+ countries experiencing civil revolution. CNN would have to go on a hiring spree to send reporters abroad, just to keep up with the weekly civil revolutions.
It's all relative, specifically, the stock market going up these days is no longer a reflection of highly successful companies and overall market stability and strong national/global economics built upon *** REAL *** fundamentals... Instead of cheap credit (manipulated interest rates), bail outs, diluted currencies, energy & food and other comodity inflation.
If Bernanke were to take his foot off the QE accelerator, the GLOBAL stock markets would correct more than 40% in less than 2 months and likely eventually go below 2008 lows. He's trapped, he may jawbone all he wants about an "exit strategy" but quite simply it just wont happen, even less so if he now also has an unemployment agenda to maintain. So, it's extend and pretend, print and inflate.
Even if Victoria housing remains flat for 5 years, I will have made a killing in commodities and be able to afford way more house(s) then.
The main trick is not to try to be a saver during obvious inflationary spirals. Inflation will kill your buying power. So if you dont plan to buy for a few years, get that money out of the GIC and buy some gold, silver, oil, uranium, and agricultural stocks (if you can sleep at night knowing your food speculation is resulting in a few hundred people starving around the world).
/rant
Mr.4AM
PS. I just bought another $125K of silver today. Wish me luck! ;-)
You went long $125k at $30 an ounce?
Be careful...that could leave a mark.
;-)
Allow me to sumarize my last post in 1 chart for those that are new here. Each year, for the past 7+ years in a row, you require less ounces of gold to purchase a Vancouver home (or in any other Canadian city). All while real estate exploded upwards in price. Why? Because gold exploded even faster upwards in price? Why, because the world is awash with debt & ever more diluted currencies. Is this a gold bubble? Let me answer that with a few other questions:
1) How many friends do you have that own a home? How many friends do you know that have bought gold in the past 7 years?
2) Has the government subsidized gold purchasing?(no). Has the government subsidized house purchasing? (yes - low interest rates, tax write offs, lax lending rules, etc).
3) Are the largest holders of gold in the entire world (the central banks) selling their gold? No, they are buying more and faster than ever!
I could go on for quite a while, but you get the idea.
Mr.4AM
Kabloona... that's ok I'm hedged when I bought a similar ammount at $13/oz ;-)
Last link, and now I'll shut up for a while :)
Mr.4AM
PS. What happens when gold will get too expensive for 1.3 billion poor chinese people to buy? They turn to "poor man's gold". Aka: element AG ;-)
Mr. 4AM.... I predict your future...
What a genius
Leo. Yeah I couldn't believe that article. Who's stupid enough to store bars of precious metals at home?
Oh well whatever, I'm almost up $1/oz this morning. Did your house also appreciate 3% overnight? ;-)
... nothing to worry about ...
Household debt surpasses six-figure mark
The debt-to-income ratio is now at a whopping 150%! And a full 1/3 of that debt isn't even mortgage debt...
Bizarre how these commodity bubbles are like clockwork. Looks like peaks in 1920, 1951, 1980. Wierd if 2011 turns out to be the next peak. Even stranger, check out how oil peaked in 1948, three years prior to the agricultural commodities in 1951. Maybe history does repeat?
http://imf.org/external/pubs/ft/weo/2009/01/c1/box1_5_1.csv
PS I think you have to have microsoft excel to view it
Where the hell did the retirement market go in Victoria?
Case in point - 10 mile point.
Wedgwood Estates is a luxury condominium complex. The suites are about 1,900 finished square feet, many with views. But if you have kids under 19, they will have to live somewhere else.
I like this complex, and I would live there if I met the age restrictions. Well, one just sold for $540,000 or about $280 a square foot for 1,931 finished square feet. The same condo was bought new in 1993 for $289,000.
So in 18 years, the property has gone up only 86 percent, while houses have tripled in price.
So the retires aren't moving this market.
How about that shortage of land. Well, not in Sooke. Because asking prices for 6,500 square foot lots in new subdivisions is $125,000.
That doesn't scream shortage to moi, especially when there are another 139 lots for sale.
Of course the argument can be made, that the lot is so low in price because people don't want to live in Sooke - anymore?
But that can't be happening in Victoria? Well don't tell the fella who had his lot listed in Maplewood for the last 5 months and dropped his price by $50,000 to get a sale at $378,000.
That's a heck of a large adjustment for location between Sooke and Maplewood. A quarter million dollars over 40 kilometers or about a grand a month in financing costs at current interest rates. That's a month in France for the family every year or you can roast wieners in your backyard in Maplewood.
Ever wonder what someone would pay for waterfront in Oak Bay over a regular building lot?
The answer is an additional million dollars or twice the price of similar sized upland lot. At current interest rates that's almost another $4,000 each and every month or $50,000 a year to look at the water. No wonder they get mad at me when I take my shirt off and sun tan on the beach, that's gotta cost them a couple of hundred bucks in lost view amenity. If I went skinny dipping that could put them into foreclosure.
My family and I are moving from Albera to the Island. We are looking to get in the market in the Metchsoin/Colwood/Langford Area. The In-laws have a place in Metchosin. We don't know the area all that well - does anyone have an opinion on which area would be better for a family? We have 3 young children - proximity to schools etc.. is important.
Any thoughts?
Just Jack, time to do your magic on this new neighbourhood, like you did for Victoria a couple of months ago...
How about liquidity in real estate for the rich and famous?
Can you imagine having your home listed for 6 1/2 years! That's $19,250,000 for 11,000 finished square feet of polished granite or $1,750 per square foot. Makes you think twice where you place your Home Depot waste basket!
Of course you have to be "qualified" before you can view this property on Lands End Road. A coupon clipped from your orange juice box doesn't cut it.
Still don't know what to do with those lottery winnings and the commute from North Saanich by a personal helicopter getting you down. Well come on down to South Oak Bay and save yourself $8,000,000. Of course the home needs to be aired out from all the hockey gear. But for $950 per square foot its a steal of a deal as this property screams wealthy entrepreneur. Of course leave your ego at the door, as the home already has one.
Still not finding anything of quality in your price range. Need something to say - I'm different. How about a property for you to roam around on your horse in full Knights regalia. Where you can entertain in medieval fashion. Comes with medieval stooks to lock up those peasant neighbors. All yours for a meager $13,000,000 Canadian. But hurry because they will be showing it this afternoon and I think the couple are going to make an offer.
Brown Family, anywhere Alberta to Western commmunities V.I., is likely the worst 'trade' in the country right now. Reasons are many, but one is Alberta's creating all the jobs again while BC is now losing the most. I know several ex-Albertans who live in those areas you mentioned who are now planning to move back home.. two are contractors. I suspect the ebb back to Alberta to last quite a few years, somewhat like the period a decade ago.
Reilly
My job allows me to work from home for 6-8 months of the year. Only need to be in AB for 4 months or so. The job market on the Island isn't a concern for me. More concerned about whether property values out there are going to drop significantly. Considering not buying until late summer/fall to see how the housing market plays out.
Thanks for the response though.
TB
Well Mr and Mrs Brown.
Metchosin is a semi-rural area of homes on acreage. The acreage ranges from steep, rocky and heavily treed land to low lying agricultural land used as forage. If you like horses, sheep and privacy this may be what you're looking for. Two vehicles are a must as nothing is in walking distance.
Langford and Colwood are built up areas. It seems half the homes in the area are less than 5 years old and the other half is over 30 years old. You can live on a mountain top with a golf course and its own micro climate or a condo in the town core. There is no such thing as a three bedroom condo in these areas as most are about the size of a two stall barn with about as much attention to detail.
Big box stores thrive here. Everything is within 10 minutes of each other, unless you drive a car and then its 40 minutes. Lots of good schools, lots of good kids. Very little pan-handling (note: see Victoria City). You can bi-cycle to most areas - however, you might not arrive in most areas. Victoria drivers are not the worst in the world (note: see Vancouver) but they try harder. If you see cars with only a little tuft of gray hair visible - you're in Oak Bay.
Brown Family
No worries, I only mentioned the job market as one indicator of a weakening property market.. especially in W. Communities. Could be some good deals by summer/fall. My estimate is property out there falls by 25-35% by 2013/14 depending how high rates go. It’s about half as affordable as say Calgary.. very few high paying jobs out here.. zippo blue-collar.
I don't think we are in the market for an acreage at this time. From what I can tell the acreage market out there is hit and miss. If you wanted to sell the property it may take quite a while.
I prefer Colwood because it seemed to be a more mature neighborhood with larger lots. My wife liked Langford because the houses seemed newer. One thing I'm worried about is the quality of the new houses. In AB over the last few years the quality of the new houses is terrible.
brown family,
Be aware that many of the people that live in Langford/Colwood are younger families with the primary wage earner some how dependent on the housing industry. Lots of people out there hold very big mortgages with little or no equity. Most expect that if the market drops, this could be an area that sees the worst of it. When we had our mini housing drop, this was true.
Lots of kids out there though, especially compared to the core areas. We some times refer to Victoria as old Victoria and the communities as young Victoria.
Brown Family,
The next blog post will be for you.
I should mention Metchosin is not very development friendly. Many find value in living there compared to langford/colwood. Of course it is farther to commute into town, but as you said that isn't an issue.
Been to east sooke park yet?
Ideally we'd like to live in Metchosin. However, proximity to schools/Rec Centers/Kids to play with is our priority right now. When I was in Metchosin I didn't notice many kids. Property values are high, most people are retirees.
We would like something close to our inlaws (Cliff Drive) but within walking distance of a pre-school/elementary school.
If you're thinking of Langford/Colwood, I would definitely wait until the fall. The new CMHC rules will at least have a sizable effect there.
Ideally we'd like to live in Metchosin. However, proximity to schools/Rec Centers/Kids to play with is our priority right now. When I was in Metchosin I didn't notice many kids. Property values are high, most people are retirees.
You've really come to the wrong place for advice--few of these bloggers own property and they can hardly be called "objective." Have you checked Garth Turner's blog recently? It would be about as useful as this one--i.e., not.
There is one thing Garth says that I agree with--in the future, real estate in the core of cities will flourish while real estate in the suburbs and rural areas may well fall significantly in value. This is because (a) most jobs are in cities and people don't like commuting for two or more hours a day to get to and from work and (b) families can get more of the services (schools, shopping, rec centres, etc.) and social facilities (kids' friends, adult recreation, etc.) easily in the core of cities, not so much in far-flung rural areas. You may be able to avoid the commute but if you're concerned about property values you should be looking at central areas in the Victoria region.
That is the thing about real estate- location costs. In a few years you might have to sell. You are far more likely to do ok with a better location.
Might as well get used to the idea of holding a BC sized mortgage now, it will save you a lot of time.
Brown Family, I have to agree with omc when I moved here two years ago I bought in a core area a few blocks from the beach even though it was more $ than I wanted to spend at the time. When I purchased there were a number of houses for sale in this area, but since the middle of 2009 after that inventory dried up only three houses have hit the market and all sold in days. People love it and do not move and the prices appear more stable than out in the western communities. So it may be worth considering a bigger mortgage and live in the core.
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