Monday, April 11, 2011

Monday market update: woah nelly!


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 April 2011 (first 4 days of April in brackets)
Net Unconditional Sales: 167 (47)
New Listings: 514 (135)
Active Listings: 4,103 (3,925)
Current sales to new listings ratio: 32%

April 2010 totals 
Net Unconditional Sales: 756
New Listings: 1,783
Active Listings: 4,229
Sales to new listings ratio: 42%
Sales to active listings ratio: 18% or 5.6 MOI

The spring listings frenzy is on. If current pace continues (and it likely won't) we'll see 1410 new listings this month. I'll put the final number closer to 1250 as the beginning of the month typically sees more listings than the end, and with a major long weekend (4 days of Easter) happening late April, I think we'll see this number slow down.

Obviously the short-term trend of declining sales volume is continuing. If current sales pace continues, we'll be hard pressed to break 500 sales for April 2011. I'll peg the final sales volume number to be somewhere around 520ish.

There's some evidence to suggest the gap between asking price and sales price is growing. There's also evidence to suggest the gap between sales price and assessed value (as per BC Assessment) is shrinking. Both of these factors suggest prices are falling (despite how VREB calculates average prices). Based on current supply demand ratios I'm tempted to suggest that negative price pressure is slight, not substantial at this time.

Further note: that last post had some significant discussion, which I'm very grateful for. Every time I wanted to publish a new post, I felt like I'd be interrupting the discussion. Thanks to all of you readers and commentators out there!   

181 comments:

a simple man said...

An avalanche starts slowly at first.

JustWaiting said...

Reposting my stats from earlier today for those that missed them...
--------------------

Last night I said this spring looked real bad for sellers and agents.

I went back in the archives for this blog and found this graph by double agent...

2010 weekly sales and listings

Last year every week, starting in mid-February, had over 145 sales. This year VREB has been reporting much lower than this by around 20%. But VREB and their lapdog the TC have been pumping this as a "balanced and stable" market.

2011 is shaping up to be worse for sales than 2010, 2009 and 2008. Here is another graph from the archives....

Monthly sales April 2008 - April 2010

So far 167 sales in 10 days. If we hit 600 for the month I will be surprised. This will be lower than last month and well below last year!! VREB and TC will be hard pressed to spin that.

Leo S said...

Last year sales peaked in March which is highly atypical. Wonder if we will see a repeat this year. Hard to imagine that not lowering prices this year.

Just Jack said...

Things look good for cashing out in the city and moving to the westshore. Big, big bucks to be made, selling here and buying with 20 percent down in Saanich Peninsula or the Westshore.

Sell here for $750,000. Buy a home in Langford for $450,000 and finance it 80%.

That's around $600,000 to $660,000 in your investment account.

Bite me, that's the goose that laid the golden egg. When you've got that large of an investment working for you, the home in Langford would be paid off in half a dozen years.

God may not have made you good looking, but this could be the second best thing to happen in your life time.

Alexandrahere said...

JJ: you are consuming too much sugar.

Just Jack said...

Consumer sentiment does change.

For the last decade we've had people moving from the rural areas into the urban city for jobs. And at the same time, people in the city have stayed put, because there was never a reasonable option to moving and there just wasn't an economic incentive, other than getting a new home in the westshore for the price of 1950's basement entry house.

For most of this decade, urbanites have kept to that stigma. Which made a low level of listings and drove up prices in Victoria and Oak Bay.

Now, it appears that the listings in the urban areas are growing very quickly while sales in the same areas are falling, yet prices still remain high. Meanwhile, the inventory in the westshore is large with a lot of selection and prices are weak.

It should not be that much of a stretch to figure out what people are doing and then do the opposite. Most people today are selling low and buying high by moving to the city.

And yes, most people have an emotional attachment to their homes or for social status reasons would never consider moving to the westshore. But pride goeth before the fall.

How's this for water cooler envy: turning to your co-worker who just bought a home in the city and say: "I sold my home in Fernwood and bought one in Colwood and put a $500,000 in an investment account, in five years I'll have the Colwood house paid off and I'll be retired before I'm 45 - how's your plan working out".

So yeah, you can pooh-pooh the idea, but a half million in cash is worth a lot more than a half million in home equity.

It's an option, and if I had bought a home in South Oak Bay ten years ago for $275,000, I would be doing it today. Because, its not going to get much better than this.

Cash will be king again.

a simple man said...

JJ - I appreciate your analysis and I do agree - this could be a good time for a shrewd investor.

a simple man said...

Vancouver citizens revolt!

Foreign property buyers restrictions needed?

Just Jack said...

This is what happens when you fly a helicopter over White Rock filled with Chinese Canadian real estate agents.

It was a big, big mistake for VREB' members and the media to use racial fear mongering to increase sales. Big time damage control needed on this one. Vancouver has a bad history from the Komogata Maru, internment camps and more recent examples of racial violence.

Alexandrahere said...

Absolutely Not!! Don't listen to this. Sell your house high now and rent. Do not sell and buy in the Western Communities or anywhere else. The urban core will always be worth (alot) more than the subs. Keep your money in the bank, rent and if you live long enough after the dive in prices buy a house in a good area of town and stay there.

a simple man said...

Alexandrahere - also a good strategy. The common thread: if you are in the city and an owner, sell now.

Just Jack said...

When you read the comments to the newspaper article you can sense the undertones in almost every response. The "us" and "them".

Just Jack said...

Renting is another strategy. For some people, it isn't an option.

Home ownership has a lot of human emotions rolled up into it. Some people will not go back to renting, they need the perceived security blanket of home ownership. If the downturn takes years to bottom out, I think a lot of the people will give up on renting. And besides, lurking in the back of their minds is thought "maybe it is different here".

But, both strategies are for turning equity into money.

Just Jack said...

Believe it or not, there are people who think the Westshore is a good area to raise families.

Shockingly, they actually choose to live there - because they like it!

And have no need to go to Victoria City - at all. And if they work in the Westshore, they never have to experience the commuter crawl and are home in 10 minutes.

And even though some may have big bank accounts they don't lust for a waterfront home in Cadboro Bay. It's just not important to them.

Just Jack said...

Big day for detached home listings in Victoria City today, 116 homes and rising.

Most of the year we hover a smidge under a 100.

patriotz said...

Politicians who talk about restricting foreign ownership are just trying to divert attention from the real problem which is government policies which promote home ownership and loose oversight of lending and speculation. Including, of course, CMHC.

The is what the Australian government has been doing - introducing token restrictions on foreign ownership while at the same time allowing easy mortgage lending and giving grants to house buyers.

If CMHC introduced a price limit of $300K you'd see the market collapse so fast you'd think a tsunami was coming.

JustWaiting said...

Just Jack,

I have seen a lot of new listings today and quite a few price reductions. Some houses have only been listed for 3 weeks and have had 2 price reductions.... Seller panic??

Just Jack said...

For a lot of people, the big gauge on the market is the number of "For Sale" signs.

Some of the condo complexes I ride by have 3 or more stuck in front. This doesn't help consumer confidence. You'd be hard pressed to find anyone who would not say the market has at least slowed.

Craig said...

"Vancouver has a bad history from the Komogata Maru, internment camps and more recent examples of racial violence."

Yes, everyone knows that Vancouver is particularly prone to outbreaks of racial violence.

There's that incident 97 years ago and of course something in WWII.

Animal Spirit said...

If LeoS' data on sales from the last thread hold, there could be a shock at the end of the month as the price distribution of sales changes. Fewer low end sales with even fewer high end ones could lead to a substantive drop in median price.

Previously we may have had 45 sales low end, with 80 sales high end. Now it would be 30 sales low and 40 sales high.

Leo S said...

Sometimes holding out is worth it even in a flat market.

462 Davida Ave. After 134 days on the market at 499,900, a savvy buyer negotiates $900 off the price (smudge on one of the windows?) and buys for $499,000

Dave said...

462 Davida Ave. After 134 days on the market at 499,900, a savvy buyer negotiates $900 off the price (smudge on one of the windows?) and buys for $499,000

I couldn't believe that.......I was seeing that only recent listings were selling until that sale came along.

Dave#1

JustWaiting said...

Former VREB president Tony Joe comments on today's real estate stats.

Tony on Facebook

April sales stats for Victoria- 167 sales, 514 new listings and 4103 total inventory. Typical Spring activity with listings flowing into the market. Sales remain steady.

patriotz said...

more recent examples of racial violence

Yes there have been more recent examples of racial violence but that's been Chinese vs Vietnamese, Filipino vs Punjabi, etc.

We white guys are politically correct now but racism is still OK in Asian cultures.

Just Jack said...

How about the off-duty Vancouver cops who beat up that newspaper delivery man, Firoz Khan.

S2 (Just Jack's wife)

EagerBuyer said...

HHV,

Last month you posted a graph showing March sales for the past ten years. Any chance you could post one for April that includes your estimate of this months sales??

sunicojoseph said...


Yes there have been more recent examples of racial violence but that's been Chinese vs Vietnamese, Filipino vs Punjabi, etc.

We white guys are politically correct now but racism is still OK in Asian cultures.



Where did you hear it say that there were recent racial violence among Chinese vs Vietnamese and Filipinos, vs Punjabis? Do you have a link to an article that expicitly says that these races were involved in racial violence?

This is the first time I've heard of it.

I'm a Filipino, and in the more than 30 years that I've lived in the Philippines, I've never heard any news that Filipinos have attacked East Indians or any other nationalities because of their race. There's also nothing in the Filipino culture nor values that promote violence against people of different races. Where did you get the idea that's it's OK for Asians to be racist?

And as for "White Guys" being politically correct about racism, how about the White Supremacy Groups here in Canada? (http://en.wikipedia.org/wiki/Northern_Alliance_(Canada)). In fact, a recent CTV news reported a clash between tolerant Canadians and White Supremacy groups rallying somewhere in Canada.

Even if Canadians are mostly tolerant, discrimination still exists here against visible minorities and immigrants.

Alexandrahere said...

Nice condo just listed at #307-439 Cook. All re-done, spacious rooms, large enclosed deck (could be used as computer room/den) insuite laundry, underground parking, 2 full baths and in the most convenient area of town. Listed at $299,900 and assessed at $340,000. Also no age restrictions and you are allowed a budgie!!

JustWaiting said...

Alexandrahere,

Are you planning on buying it??

Deanna said...

That's quite the assertion patriotz. I'm white, and I see plenty of racism and bias directed at people of color in Canada and right here on the island. All you have to do is open your eyes and ears and actually pay attention to notice it.

Pickton: Mostly native women targeted.

Highway of tears: Hundreds of missing First Nations people, mostly women

Nanaimo: YouTube video of young white men assaulting a black man (who managed to scare them away, and good for him!)

And of course, there are the mundane every day racist occurrences that don't make the news. It's ridiculous to try to pretend that racism in Canada is a thing of the past.

Jason said...

The correction down under appears to be well under way:

http://www.bloomberg.com/news/2011-04-12/noosa-queensland-coast-slip-as-australia-housing-cracks-emerge.html


A funny article with examples of drops in 5 cities and grim statistics but still punctuated with commentaries from experts that the trend is 'unlikely to spread' and 'modest gains expected in 2012' for the bigger centres.

Hopefully a tremendous crash in Australia will guarantee we do not see the first-time-buyer-grant tried here here as things begin to slide downhill...

Al said...

307-439 Cook, sold in Dec 2006 for $265K (before the reno).

Just Jack said...

Something happened today. Something you rarely see now.

A sale in Bear Mountain. The Stone Gate property sold for $618,000. Or $1,000 less than it was bought for almost exactly three years ago.

But to be fair, the property did sell in December 2004 for $442,500 which is a 40 percent rise over seven years.

Some times your the pigeon some times your the statue.

DavidL said...

@ Deanna wrote: I'm white, and I see plenty of racism and bias directed at people of color in Canada and right here on the island. All you have to do is open your eyes and ears and actually pay attention to notice it.

I am mainly of Western European ancestry ... I'm also a first generation Canadian (my parents immigrated here). My wife is of mainly Chinese ancestry - however she is fifth generation Canadian. Her great-great-grandfather came to BC in the 1860's. I've heard people ask my wife: "Have you had a chance to go back to China?" and "Do your people celebrate Christmas?" - not outright racism, but certainly showing a cultutal ignorance.

On the other hand, her older brothers (mid 40's) did face outright racism in the schoolground as kids. I remember this myself, growing up in Victoria with some of my non-white friends being routinely picked on because of their "colour". I do agree with patriotz in one respect: racism is not exclusive to white people.

Fortunately, Canadians (of all backgrounds) appear to be growing more tolerance of ethnic differences ... we just have further to go.

Craig said...

My wife is mixed East Indian and Chinese while my kids are basically Heinz 57. We haven't experienced anything notable in 12 years, and that goes for most of our mixed race friends.

In a country of millions there are always going to idiots. The fact that all the examples cited here are isolated examples, some quite tenuously linked to racism, is basically proof that racism is not a pressing systemic issue.

Alexandrahere said...

Thanks Al about the Cook St. Condo. So the guy is going to lose quite a bit of money even though he bought in 2006. I know that HHV likes some of the condos in this area and this one would allow children. AT least all the work has been done on it and the floor plan is a good one.

DavidL said...

@ Craig wrote: We haven't experienced anything notable in 12 years, and that goes for most of our mixed race friends.

Over the years, I have been obliged to work with racist and/or sexist people. Having to listen to their assumptions about others and the hatred they exhibit can be truly disturbing.

I'm truly glad that you and your family haven't had to deal with racism. (Nor have my own two daughters.) Just because you haven't been exposed to racism - it doesn't mean that it doesn't exist.

Deanna said...

@ Craig
All you have to do is read the comments on any newspaper article about immigration and belief you had about "Canada's lack of racism" will be quickly dis-abused. (Oh, and ftr, Colbert is being satirical when he says he "doesn't see race", in case you were confused on that point too.)

And really, hundreds of First Nations disappeared, often murdered, with little to no outcry and very little concern on the part of the police is categorized by you as "isolated examples, some quite tenuously linked to racism". I think not. It's the very definition of racism. First Nations people are stereotyped, prevented from accessing resources, and generally undervalued. When they get disappeared, no one cares. All of that is institutionalized racism.

Institutionalized racism is behaviour that we are so accustomed to that we think it is "normal". (Also known as "unintentional racism" - where a person doesn't even know they are being racist because it's just the way they were brought up/normal part of the dominant culture). Stats Canada has plenty of employment related statistics - and there are plenty of scientific studies for you as well - if you are interested in seeing how institionalized racism affects people on an everyday basis.

For example, studies show that the very same resume will be received much differently based on the perceived race and/or gender of the resume submitter. Unsurprisingly, names that appear to be white are rated higher than the exact same resume submitted by a person of color.

http://www.imdiversity.com/villages/careers/articles/hicks_name_discrimination.asp

Anyway, sorry HHV for derailing away from houses.

a simple man said...

Nice house on Ashdown went up today for 689,000. Walked by it a short while ago - nice location. Saw a blue van with driver very interested in it.

Craig said...

This is the last I'll say on it because this is and should be a blog about housing.

DavidL:

If I say racism is no longer a systemic problem in Canada and the incidents described are isolated incidents, it is not a response to say 'racism exists.'

Of course it does, just like bestiality but it does not follow that Canadians find sheep attractive.

Deanna:

Natives suffer disproportionately from these disappearances because they are disproportionately in positions to be victimized (ie, prostitution, 15 year old girls hitchhiking on isolated highways). This is a sad reflection on their now broken way of life (largely due to the culture of welfare dependency) rather than a reflection on all of us as Canadians.

As for your study regarding the resumes, that was seized upon by the social justice industry as proof of racism, but what they won't tell you is that resumes featuring white yet 'poor' names like Bubba, Skeeter and the like will score the same as 'black' names like Tanisha, Jynelle etc.

Why? Because when employers screen applicants they make quick assumptions about socioeconomic background that would affect their ability to perform. It's a generalization to be sure, but not one overly specific to race, and it's one you, I and everyone makes all the time.

Weight, clothing, beauty, skin colour, sex, hair length you name it. Some people undoubtedly will judge my kids differently because they look a bit different but that's life. There are idiots out there but they are fewer and fewer all the time.

Waiting said...

Ha ha! I am the blue van with driver!! I inspected it from all angles but all in all I think it is too much for what it is! Nice area though - lots of kids out and about which I like. If it was less $$ and had a decent basement height I'd be interested.

Marko said...

Ashdowne - Has a buried oil tank. Way too much cash at $689k - it needs a complete reno. Lot size is solid at 60 x 120 but not 689k solid.

Marko

828Hampshire said...
This comment has been removed by the author.
a simple man said...

Hi Waiting - I really can't say why, but I had a sense it was you, which is why I posted the van colour here. I was walking by and with my kids and wife when you first drove by and then were in the park afterward. Good to put a face to the name.

a simple man said...

Thanks for the info, Marko. Now that I see the interior pics I agree it will need a lot of updating.

How much does it cost to remove an underground tank? It already has as heat pump, so I am sure the tank is not in use.

Waiting said...

A Simple Man
That's funny. I'm guessing our kids are very similar ages! We'll probably go and have a look at it but I wouldn't be interested at that price. Judging from the photos it needs a lot of work inside. I do want to be in an area with lots of kids though and a lot of the homes around there have strollers and evidence of children which I like!

think said...

Wow - I haven't had a sale on my PCS for almost a week - the listings are piling up - I am only 4 listings away from the highest inventory last year - amazing! I am following Oak Bay/Fairfield SFH 500,000 to 1.1 million. No sales + lots of new listings = ...well you know :)

828 Hampshire - I viewed your home last year when it was for sale as well - you are very overpriced - I believe you have actually raised the price from last year when it didn't sell in the 600,000 range - probably not a good idea as the market is even softer now (and I'm just letting you know that to try and be helpful - best of luck).

think said...

simple man,

it is the sellers responsibility to remove a buried oil tank - and at their cost - we encountered this with a previous home we bought.

Waiting said...

I have friends who sold a few months ago. The inspection discovered a buried oil tank (they didn't even know about it) and they had to pay to have it removed in order for their deal to go through. They also had some asbestos discovered. One was $3000 and the other closer to $10,000 to deal with but I can't remember which was which.

think said...

I stand corrected 828 Hampshire did sell July 12 2010 for 660,000 - and now is being listed for sale 9 months later for 739,000. Have you done extensive renovations or what is the story here?

a simple man said...

thanks, think. Always good to know these things when going into a negotiation.

828Hampshire said...
This comment has been removed by the author.
omc said...

My PCS has shown 5 sold listings today alone. Four in Saanich east and one in Rockland. One thing I have learned is not to get too excited and being premature on calling a drop, which I am sorry to say you guys are doing. I would say we are just entering a buyers market, but just that. We are starting to see downwards pressure on prices, but I think they crept up 1 or 2% over the winter.

I still expect later this month that we should see prices in Oak Bay back to what they were in November, which happens to be lower than when 828 Hampshire was just sold, not higher. Prices should trend lower through to the fall.

I am still seeing that most of these listings are relisted crap from last year. An example would be 2660 Macdonald in Queenswood; I am not even sure how long this one has been on the market. It started in the $950k range I think almost 2 years ago and went off the market at $825 this past winter. I guess the guy argued his assessment, like a flipper, and got it increased an entire 20%. He then tried to sell at a ridiculous price (just like 828 Hampshire) FOSBO for a few months - $900k. It is now back on MLS for $800k, which is still high for what it is.

Simple man,

A heat pump needs a back up heating system when the outside temp gets below zero. They still list oil as the heating source.

a simple man said...

Think is definitely not a realtor.

The sale information is from any of our publicly-accessible PCS accounts. Almost everyone on this blog has one.

The prior selling price is a matter of public record.

Can you detail the upgrades for us?

828Hampshire said...

Simple Man - I invite you to come out to the open house. See you then, then we can discuss in more detail.
Thanks.

omc said...

I have to question major renos on 828 hampshire.

A simple google search

Looks the same to me. It`s a declining market where the buyer has a lot of info at their disposal.

a simple man said...

omc - I am with you and the relist frustration. As well as the flipper angst - flippers make the market worse for us.

And thanks for the info re: the heat pumps. I have never had one. Had a geothermal heater on the prairies.

Incidentally, the heating costs we pay here in the winter are about the same as the same as we paid in the deep cold of the prairies. Shows how bad a lot of these houses are for energy efficiency.

omc said...

Simple man,

You are probably dead on the money there, the houses here are incredibly inefficient. I would first look at the overall house before the heating system it self. It is hard to make a house, like the majority of these Oak bay specials, worth any thing. I grew up in the trades and know what is behind the walls of these old homes. It is often more cost effective to get a bulldozer. See why I would move to Broadmead in a second if my wife let us. BTW, weather and travel is the same there as Oak Bay for the most part.

Sorry if I came of rude to the 828 guy, but I don`t like bsers. It even appears that they used many of the same photos from the listing. Nice roof!

828Hampshire said...
This comment has been removed by the author.
omc said...

extensive renovations? What are you expecting? Did you tell the truth?

Rhino said...

828Hampshire,
I sincerely hope the curve ball you have been thrown has a happy ending.

But you must have known posting here was like walking into a lions den. 80K more in 8 months? Houses go up 10K a month...330 bucks a night...Jeepers!

Like the old irishmen said, greed, greed and more f'in greed!

think said...

Did somebody say I'm a realtor - ha ha - I must have missed that - was it in one of the deleted posts? Anyway, I'm not a realtor - just a nice normal person with a family that, like simple man and omc, wants to find a nice family home in a great neighborhood at a fair price. And I too get really mad with the bsers. I agree not to get too excited omc because this has been a long rollercoaster ride so I understand your point - but I strongly believe that this market is dangerously overinflated and that we are in the correction now.

Watching and waiting said...

828hampshire:

for what it's worth, you did a great job on your website.Hope it sells. I do note you mention on your site that recent upgrades include beautiful new flooring, fresh paint and professional landscaping.Whether these upgrades warrant a substantial increase in price, well only the market can tell you that and I guess we will see. Given the fact you have put your home out there, I'd be interested to hear other's opinions what they feel the home should go for and offer objective evidence such as recent home sales/what's not selling/assessed value to sold price for that neighbourhood/$ per square foot comparisons.

828Hampshire said...
This comment has been removed by the author.
omc said...

watching and waiting, did you look at the link I provided? I don't think this individual has done squat to that house, except claim extensive renovation. He uses the same pictures as the listing when he bought even. I am sorry, but I don't believe a word he says. I notice he has removed his posting when he challenged me. I still call BS

Al said...

Funny that a seller would come to here, a place where people weed out flips and markups and bad deals, to promote over priced houses, what are you thinking, or just too desperate?

Look what happens now, not only the regular posters wouldn't buy it, the people read this site will stay away from you too. Sorry, bad move if you want to sell with this price, maybe time to use a realtor who knows where to post?

Leo S said...

Looks like a decent enough place. Well staged at least.

Market value or not, it's still a ludicrous price.

a simple man said...

Hi 828 - thanks for your offer to view your home, but it is too small for my large family with only 2 bedrooms.

omc said...

I guess since 828 has removed all of his posts you missed the one where he specifally called you (and everyone else who questioned him) an internet bully simple man. A fair bit of drama with lots of self pity from this manipulative one.

As Al said, I too believe he is desperate. I suspect he got in way over his head in his mortgage. He certainly has almost no knowledge about real estate and is one of the people who could benefit from the services of a realtor. You can't lie about things and expect people to just believe you.

Phil said...

If you look around you can rent a nicer house than that for $1500/month. We do.

Or in other words, when that place drops to 250K we might consider it and you guys should do the same. If it never happens, so be it - let the suckers be debt slaves.

Marko said...

Speaking of rent versus own it seems in the lower end of the market the spread is much smaller.

Here is an illustration.

MLS: 290826, 417 - 827 North Park, just sold for $164,000 and it rents for $860/month. Strata fees $117.

a simple man said...

@omc - yes, I did miss that part. I am many things, however, a bully has never been one of them.

@Phil - you understand what is happening.

Just Jack said...

A few years back, the buzz in Victoria was how the retirement community was moving to Victoria and how the hot American market were driving up prices.

Where have they gone?

Properties with age restrictions, Gulf Island homes and the million dollar plus market are the depressed markets today with lots of listings, few sales, and prices that have rolled back to 2006-2008 price levels.


Except for some select condominium developments, buying a condominium today is saying good-bye to future appreciation and hello to a life time of debt.

The western communities are crowded with listings. Homes bought only 3 or 4 years ago making up the majority of the listings, but very few of the sales. About 1 out of every 6 homes listed today are for immediate occupancy - which to me, means vacant. That's high! The average days on market is reaching into the 60's from less than a week, just a couple of years ago. More new listing and more price drops on the existing stock.

Yet, the houses in the urban communities appear impenetrable to a price decline as the hounds of home price deflation, are clawing at the doors of Fernwood.

Its like sitting on an air mattress, the depressed areas push up the other end of the mattress. As people flee to what is perceived the "safe" location to live causing prices to fall in most areas and rise in another location and type of property.

Their betting that a market correction will be short, so that the urban areas will not drop to the level of the outlying areas. But the correction will not be short it may be decades or it might never happen that real prices will be at this level again for generations.

We can't play the Asian game as they do in Vancouver, because there just isn't a large enough visible minority in Victoria. The real estate agent's tried it with American and Albertans, but the data slipped out that wasn't true. Besides who doesn't want Meg Tilly or John Travolta as your neighbor.

If we could only convince the Irish and the Scots to be boat people again - maybe then we could put some fire back in the market.

JustWaiting said...

Looks like the TC ran a bearish article today. The stimulus was a Royal Lepage press release instead of the usual the Remax nonsense. This will get the sellers nervous when they pick up their daily paper. I suspect it will be on TV tonight.

Home prices soften with more listings

An increase in listings has cooled real estate prices and created a "buyer's market" in Greater Victoria, according to a new survey by Royal LePage.

The real estate firm said Tuesday the average price of a detached bungalow in the region fell 4.2 per cent to $490,000 in the first quarter of 2011 compared to the same period a year ago. Other types of housing showed slight increases with condominium prices inching 1.4 per cent higher to $299,000 and standard two-storey homes up 1.1 per cent to $480,000.

All increases were well below the national averages.


The story has the usual realtor comments that "it is a great time to buy". Realtors always think it is a great time to buy because they need that commission cheque.

The story talks about lots of listings but the TC apparently doesn't know about the April sales slump. It looks like April 2011 sales will be the worst in 10 years unless there is a real flurry of sales in the next two weeks.

Waiting said...

Went to see Ashdowne this morning. Here's my take:
The goods:
Recognizing that it is a 50's bungalow, it is one of the nicer floor plans IMO. A fairly open entry, 3 decent sized bedrooms, a kitchen with room for a small table and a nice living/dining space. The bathroom, for the era, is a decent size. The backyard is lovely and the house gets a lot of natural light.
The Negatives and downright lies:
Despite what it says in the write up there is not a vinyl window in the place. The basement height might be 7 feet at its highest point, but much is lower (largely due to the ducting I imagine), some door frames are not full height. One room has a raised floor.
The entire house is dated, IMO it needs a new kitchen, new bathrooms and the basement refinished (I'm not a fan of fake wood paneling and prefer drywall) There is a lot of useable space down though. There is a buried oil tank (unused) and an interior oil tank. The furnace is 1996. The heat pump is OLD!
My realtor agreed it is a nice area but didn't think it was any bargain. For someone with lots of $$ it could be made into a nice home but I think it is a steep price to pay for that sort of home. There was a steady stream of people going through so I imagine it will sell quickly. I think many who aren't as fussy about finishing as me would think it is fine as is and I imagine it will sell to someone like that.
Anyone else go to see it? Your thoughts?

a simple man said...

You are right, Waiting, it is overpriced when you believe what we believe - that the market will drop. However, with very few quality listings in this area, this house should sell relatively quickly at near asking.

Stay true to your name.

omc said...

I don't know that that house will sell that fast. That area was not considered to be desirable up until just a few years ago, and should sell lower compared to other Oak Bay neighbourhoods. Not so great to go for walks and further from the water.

*That house doesn't have a view like the houses that sold on larkdown.

* The downstairs is DIY finishing, I don't (and most realtors don't) consider that to be finished space.

*The house requires a lot of work. Too much for retirees from out of town, and probably out of reach $ for most requiring a mortgage. This leaves a small target audience.

* The lot is much smaller compared to others that have sold in that area.

* It would take too much money to bring it up to the level of those that have sold in the area. You could drop $100k in a sec there and it won't be as nice as 2 of the Larkedowne houses that sold, but it cost you more.

omc said...

I forgot to say that if the heat pump is that old, it will have to be replaced. By law, you are not allowed to service older heat pump/air conditioning units because they use an ozone depleting refrigerant. You have to replace them, which costs more than a new install.

Just Jack said...

Is it a property ladder or a property stool?

How about a success story for a change.

Recent sale on Lang Street near Mayfair for $493,000. After being cleaned up, refinished floors, paint, new appliances, some bathroom fixtures, hot water tank and a roof.

And had sold almost exactly four years ago for $417,000. Gross profit of $76,000 or 15%.

Hardly seems worth it as the core house median rose from $521,500 to $611,000 or 17% during the same time. It looks like the tens of thousands of dollars spent on the home added nothing to its value. The home would have increased the same in value, even if the owner had never opened a can of paint.

Or - (insert drum roll) the vendor, overbought the home four years ago maybe because the real estate agent said there was another offer on the property so they should offer close to list price.

The rise in the market over the last four years, saved this vendors ass.

Waiting said...

The house next door to the current Ashdowne sold a few years ago for $688,000 so it goes to show that prices are pretty stable, or haven't really increased in the past couple of years in that area.
Has anyone seen the house on Oakdowne for $759,000?

Leo S said...

@Phil
If you look around you can rent a nicer house than that for $1500/month. We do.

Then you are getting the deal of the century. There are very, very few detached house rentals in Victoria for $1500/month or less, and certainly none of those are 2000sqft in Oak Bay.

Waiting said...

I've actually found rent to be very high in Victoria. We looked at a lot of rental properties when we moved here 2 years ago and for the most part anything under $2200 was in terrible condition.

a simple man said...

I have a friend who is an appraiser in town (yes, some fun discussions) and we were told by the appraiser that Nickel Bros will remove a house from your lot for $0 if it is in relatively good condition. Might this be a good solution for the Oak Bay folks looking to build new?

Just Jack said...

Bit of a let down as the number of house listings in Victoria dropped from 116 yesterday to 111 today. I think only one sold, the others expired or were canceled.

We are still running 4 months of inventory which shows the Victoria city market is tipped in favor of the seller. Its only when you venture outside of the walls of the urban core do you find the months of inventory sky rocket to near 8 months.

There are just as many houses for sale on Bear Mountain as in all of Oak Bay.

In Sooke, population 11,000, there are 225 homes for sale. Which is about the same number of homes (237) for sale in Oak Bay, Esquimalt and Victoria City that have a combined population of 120,000 people.

I think there are about the same amount of homes in Sooke as in Oak Bay, yet there are 3 times more homes up for sale in Sooke.

It would be freaky to see that many signs in Oak Bay, basically a house for sale on every street. But it wasn't too long ago that Sooke had under 4 months of inventory too.

Marko said...

Some big sales so far this month, SFH average is running about 625k and condo above 400k right now! (Shoal Point sale of 3 mill).

Just Jack said...

I think it depends on the house, Simpleman. The floor space ratio is important to a lot of people and Oak Bay is a bugger to deal with.

If you have a wood deck that is 6 inches above the ground, Oak Bay considers that in the floor space ratio. Remove the wood deck and put a concrete patio there and it's not included.

When land in Oak Bay is so expensive, you should build to the last square inch. If you are lucky to find an old timer house that is larger than the allowable floor space ratio, it may be better to renovate than loose house size.

As in most things in life - size does matter.

Al said...

Also remember the story of required expensive checking for possible native burial site in Okay Bay? The lady regrets now that she should just renovate the old house instead of removing it and building new.

So check to see if the lot is in the required checking area first, before buying to rebuild.

Just Jack said...

I think that native land assessment applies only to water front properties. You would think that to find out that your property is on the native watch list, someone would tell you, or you could find out on the web. Nope. When you apply for the building permit, that's when you find out. There's a waterfront property in View Royal that has been put up for sale after only being bought last year. The pictures shows an unfinished foundation. I wonder if the cost of the native assessment is the cause of the property being re-listed. And do you think, the listing agent should be obliged to tell you?

With the cost of the assessment possibly running into hundreds of thousand of dollars to you, what would you do if you found some dry bones and arrow heads on your property.

1) report it
2) ahhh, re bury them on Gordon Campbell's property
3) other

a simple man said...

Coincidentally, that house that was recently all over the media for the archeological assessment is now for sale. I ran by it the other night while on Willows beach and couldn't believe my eyes - at first I thought it was an election sign, but after running right up to it I saw it was indeed for sale - after all that fighting...and it is a new home.

Could be yours - only 2.9 million. Two bedrooms.

think said...

...still NOTHING sold on my PCS - can't believe how slow it is for sales! New listing and some price changes today though...

Watching and waiting said...

another spring relist:

http://www.usedvictoria.com/classified-ad/Beautiful-Oak-Bay-4bd3bth-home-on-large-lot_14594177

this time the owner is selling on his own ... hey he's offering a 1% finders fee to the person who introduces the property to the purchaser; how generous < sarcasm >.

OMC: yeah saw his link - just throwing the dog (828) a bone that's all. We both know it will not sell at that price and ultimately, if he opts not to reduce his price, he'll have no choice but to enlist a realtor to "market" the property on MLS and chase the market down.

a simple man said...

Hi Watching and waiting;

This is also on the pcs - on Plymouth. Went to the open house - it is a flip. Say no more.

omc said...

The funny thing about that Plymouth flip, is that I heard it was realtors. I guess they are trying to work all angles.

Watching and waiting said...
This comment has been removed by the author.
Waiting said...

@think
I'm following Oak Bay, James Bay, Fairfield, Rockland, and parts of Saanich East. I'm still having about an equal number of new listings to sales each day. I think I saw three sales go through today and only 2 new lists. I know I'm only looking at a snapshot of the city but some areas are still selling decently. One of the sales was $13,000 over asking.
I continue to dream of the days where prices actually come down but I'm beginning to lose faith.

Watching and waiting said...

OMC/simple man: noted - my PCS account does not go that high.thanks for cluing me in.

I have seen that occasionally a certain realtor (Mr. "your home sold guaranteed or I'll buy") throws his flips on craigslist as an "owner" stating the house is going on the market in a few days and to get in before the MLS price. Like you say, working at all angles. My all time favourite slogan is "the bank says it has to go".

The flips are strictly cosmetic with the cheapest cabinets/finishing/berber carpet (need I say more?) and no regard to the actual real upgrades ie perimeter drains. But as we know, some people fall for lipstick on a pig.

So was perusing this ad: mls 291396, you would think if you are entrusting a real estate professional to sell your home, that attention to detail would be paramount. In this case I invite to read his ad in which he says (verbatim): "Come have a look at this house and you will be presently surprised.!"

..is this really a guy you want handling your property transfer/contract of sale??!!

think said...

waiting,
I am watching a more specific segment of the market than you - just single family homes in Oak Bay and Fairfield - so the sales you saw must have been in different areas because there have been none in Oak Bay/Fairfield for quite a few days. The reason I mention this is because it is different from what I have observed before - usually this time of year there are sales everyday - but right now everything is just sitting - we are at a price ceiling and overpriced homes aren't selling - even a few things that seem more "reasonably" priced are still sitting. I love to watch trends and right now the trend seems to be slowing sales and enough new listings to grow inventory - will be interesting to keep watching. Its been basically 2 years of flat prices in Victoria - but we only need a little wind to blow over this house of cards - and continued slow sales and growing inventory will for sure provide that. I can't wait for Monday's numbers!

Craig said...

"I've actually found rent to be very high in Victoria. We looked at a lot of rental properties when we moved here 2 years ago and for the most part anything under $2200 was in terrible condition."

Nothing has changed. We're happy paying about $3000 but the housing stock is just awful. There should be a special place in hell for owners who describe their clapboard hut as an executive home.

a simple man said...

I rent a nice 4-bedroom home in Oak Bay that includes a gardener for less than $2200 a month - we have the whole house and an attached garage. Five minute walk to Willows beach.

happy renter said...

Any thoughts on the townhouse at 19 - 1019 North Park? How high quality is a townhouse complex that was built in 2002?

I think the unit is a re-list. Maybe it was for sale before in the fall?

Just Jack said...

New sale of a near new home built in the character style on Richmond this week. Weighing in at $1,250,000. This heavy weight sold four years ago for $999,000. That's an increase of a quarter million dollars or 25%.

Zowie!!

That's a nice profit, over the normal increase of 20 percent for the typical home for the same period. Proving, that if you have the right home in the right location their are enough contenders left to duke it out.

The listing agent deserves a $50,000 tip for selling this one.

Just Jack said...

That would make the third sale of that particular townhome since the complex was built in 2002. Which is a normal turn over rate in this market. The balance of the new home warranty would still be in-place until 2012.

It seems to have four levels, which is not a good re-sale feature as it reduces the demand by the more mature market segment. I think you'll get tired of all those stairs quickly, but on the positive side you'll have thighs that can crack coconuts.

Just Jack said...

The problem with flipping houses is that it's always the last home that you buy that buries you.

Like Ashdowne, pay a hundred grand too much, add in renovations and you can be in the toilet for the rest of your life. All the money you made flipping homes gone -because of the last home you bought.

SilverSurfer said...

Good point about flipping homes JJ. It's like a Texas Hold'em poker game where some people keep going all in every hand with bigger and bigger flips, until one day, you actually lose. Then it's game over.

"You gotta know when to hold'em, know when to fold 'em, and when to walk away" ;-)

The pot odds are startng to stack against flippers.

relativelyspeakin said...

Hi All
Long time lurker, first time posting.

Happy Renter: the townhouse on North Park was listed in September last year at $395k, they eventually dropped it to $380k. It sat on the market for 3 mos with no movement and then it expired. Now they've evidently gotten themselves a new realtor that has somehow convinced them they were listed too low, and they've come back on at $399k. IMHO, way overpriced for the configuration (4 floors) and neighbourhood.
___
My PCS is set for townhouses and duplexes under $400k in the core (have no desire for the Colwood crawl). I'm in the market to buy but I'm taking my time and waiting to see what comes up - nothing has appeared that I think is worth it and in my price range yet. I know they exist and do come up from time to time but I wanted to sell first so that I would hold the cards during negotiations (no 'subject to sale' etc.)

In March I sold my 465 sq ft downtown condo that I bought in 2005 to a 35 yr amort. buyer at a decent price (actually I think it's atrocious that anyone would pay that much for such a small space...but hey, I'll take it) and now am living with my mother until I find what I want. I'm hoping that living with my mother again will not cause me to make a bad real estate decision....

Waiting said...

I see Ashdowne sold for $732,500. Crazy! Rest assured it did not sell to me!

Leo S said...

I'm hoping that living with my mother again will not cause me to make a bad real estate decision

It certainly could!! :)

Marko said...

"I see Ashdowne sold for $732,500. Crazy! Rest assured it did not sell to me!"

Pretty much unconditional offer too....I honestly don't know what to say - I thought this would sell for 650k and 3 months from now.

omc said...

re that ashdowne shack: There is one born every minute. What is scary here is that there was nore than one, since it obviously ended in a bidding war.

I went to view it out of curiousity, but I was told they were awaiting an offer at 7pm yesterday so I skipped it. The idiot who bought this one didn't even get an inspection. The price they paid is very close to a fully renovated house in the same area with a bigger/nicer lot AND a view.

Is there pirate treasure buried there?

a simple man said...

Well, if they hold on to the house for the next 30 years they will be in the positive again.

Bidding wars are a strange phenomenon. I have vowed to never engage, because even when you win, you lose.

Just Jack said...

They'll probably finance the home at 80 percent of the purchase price. So that's $586,000 on a home worth $630,000 or effectively 93% financing on what the property should have sold for.

The band played on, even after the Titanic hit the iceberg.

happy renter said...

Thanks for your opinions on the townhouse, JJ and relativelyspeakin. I'm waiting until prices come down a fair bit before I buy, but I'm pretty interested in townhouses in the core. If I can find one with 3 bedrooms and 2 bathrooms in a nice location, I'm game to buy a townhouse rather than a SFH. There's no way I'm going to max myself out on a SFH if I can find an affordable townhouse with just as much (indoor) space. But I am a little leary of strata councils, having had my own bad experience as a former condo owner. I've also heard that townhomes can sometimes be of spotty quality if they were slapped up in a hurry to sell. A few units on North Park have come up since I've had my PCS account, so it's good to know what others think of that particular complex.

Just Jack said...

Some town house complexes have a high turn over rate. These are the ones I would keep clear of.

Age restrictions can be a pain in the buttocks too. I'd like to see the city get rid of that form of age discrimination.

And, it would be nice, if Victoria had more town home complexes, but since there is more profit in building smaller and smaller condominiums - its unlikely.

My dream of owning a home in Uplands and cutting the lawn naked is getting farther away each day. Well, almost naked - I'd keep my wool socks on.

think said...

ashdowne sold - well I guess I'll have a sale on my PCS today - LOL - I can't believe it - sooooo foolish - I can think of 3 or 4 houses in Oak Bay/Fairfield that are better and cheaper - what fools!!!!!!!!!!!! Oh well - not my problem :)

relativelyspeakin said...

JJ: Thank goodness for the wool socks...


Stratas have their good and bad points - but I've noticed some townhouse stratas with such restrictive rules that they can't sell their units. One particularly nicely laid out townhouse in the Gorge area - kept lowering their price and waiting for a sale because a) Residents must be over 19 b) No rentals c) No pets.

It's actually the first townhouse strata I've come across that has No Pets at all (it's common to limit # of pets or size, of course).

And I won't buy into a complex that has age restrictions - I think they're just wrong - and diminish the market that I'll be able to sell to when the time comes.

I think these owners - in order to preserve their 'way of life' - are severely limiting their property's potential. The property is not getting any younger - adding restrictions to who you can sell it to just diminishes their value further.

Deanna said...

I agree - it's bad to have age and pet restrictions.

I have a lot of sympathy for stratas that limit renting (either number of units or only in "emergency situations with permission of strata"). Absentee landlords who refuse to vote for maintenance or improvements to be done can make things pretty rotten for people who actually live in the building. Also, stratas have enough problems with troublesome owners who don't think they have to follow the rules ("you can't prove it was my kid spraypainting the hallway or stubbing out cigarettes in the carpet, I don't care which senior citizen witnessed it, so I'm not paying for the damage to be repaired"*) without trying to manage someone else's tenants too.

*Oh lord, do I have stories from when I was on a strata council. But at least we managed to actually fix up the place. First new common area paint and carpets in 30 years!

Deanna said...

Sorry, that should say "restrictions that disallow pets". Of course, reasonable limits should be put in place.

nan said...

I think many of those use restrictions are a result of people trying to turn a consumable asset into an investment that they can sell later. It's like buying a car only to park it because you worry too much about someone scratching it.

Al said...

Probably the same for rental restriction. If people don't want rental suites in the street where they buy houses, why wouldn't they want rental restriction when buying a unit to live in a complex? The restriction may not be good for rental unit investors, but is certainly good for owners who live there.

Reid said...

Rumours I have been hearing from government in the past week suggest that if the HST is voted down in the upcoming referendum it will have a significant impact on the provincial government’s budget. The sense is that many programs will simply not get funded and significant layoffs may follow. So a decision to kill the HST may help over time to drive down the Victoria’s housing market (as many government employees feel their jobs are secure, which of course is not the case).

I personally support the HST and will vote to keep it, but the outcome of the vote could be signficant to the Victoria economy.

Just Jack said...

I'm in favour of the HST too, I would just like the tax buried in the price.

The price you see - is the price you pay

a simple man said...

OK - so Ashdowne - shocking price for that home. But that is 1 sale in a week in all of Oak Bay (under $1M).

That, too, is shocking.

Just Janice said...

My husband is growing impatient with not owning our home...I am not eager to double our monthly housing costs but don't think I can delay much longer. We have another 1.5 years left on our lease. My husband wants to approach the property owner sooner as opposed to later. I am super nervous about doing so as she may take him up on the offer sooner as opposed to later and we will wind up buying at the peak of the market.

We're waterfront Fairfield, 4 bed 2 bath home in need of fairly significant landscaping and maintenance. Our intent would be to buy, live in the existing home for 5 years and then tear down and build new. What is fair value (lot is around 7500sq. Ft.)? What is the bear consensus on downside risk from peak?

Any suggestions?

I am thinking approach the owner with the following proposal: lease to own for 5 years at current rental rate plus 3% per annum with intent to purchase in 2016 at the 2016 BC assessment value...

happy renter said...

Another price drop on another very nice townhouse: 2-1137 Meares

Does anyone know what that unit originally sold for just a few years ago? I love the building, but I don't love the location. If it dropped 20%, though, I'd be sorely tempted to buy it.

a simple man said...

Hi Just Janice;

Good to have you back. My take is that we will see at least 25% decrease in prices over the next few years - but no one really knows. The indicators and logic seems to point in that direction.

I would caution long-term arrangements. What is the market goes up considerably? Then you would be on the hook for the increased appraisal. the landlord would also be taking a risk that the market would plummet (what we think) and then you would look like a genius.

Buying now there are no guarantees - but then there never are.

good luck.

a simple man said...

happy renter - don't compromise on location or you will have to change your name to sad owner.

Location really is worth it. But you have to accept less house/townhouse/condo to get it.

happy renter said...

a simple man: that's very true, and I really don't want to change my name any time soon!

I guess I've just been thinking about townhouses more and more as a reasonable option for me, but I haven't seen many around that I'd actually want to live in. The building on Meares is beautiful but is right by a bunch of kind of run down apartment buildings. Oh well, it's not as though I'm in a hurry. I'll wait at least a year to see what the market does before I jump back to being a hopefully happy owner.

Just Jack said...

Do yourself a favor, find out if the property will need an archeological assessment before you buy. My bet is that you will need one done before you can alter the property with a home or landscaping.

The cost is extreme for water front properties. It could be a couple of hundred thousands dollars and a year in delayed construction as students, professors and native leaders pour over your site raking the dirt with toothbrushes and flour sifters.

Waterfront is the most volatile of land to buy. While a lot of people would like to have waterfront, the actual demand by those that can afford it is very limited. The time to effectively market is long and gets even longer in an economic downturn. And if you have to sell in a market downturn - your going to get butchered by prospective purchasers.

Buying waterfront is more of an emotional issue than economic. Owning waterfront is fine if your a mature couple or empty nesters, but having the ocean in your back yard is on par with having an inground pool or backing onto a cliff if you have toddlers.

But nothing says to your peers that you've "made it", like owning waterfront. Well actually a nice yacht would be better, because more of your peers will want to spend time on the boat cruising the Gulf Islands, than in your back yard.

In fact I'd be willing to be an unpaid deck hand if you bought a nice little 50 footer. I'd even bring the Chivas.

omc said...

That Oakdowne was the first sale in Oak Bay for a while; I wouldn't put much store in that. I still think there is a very strong demand for reasonable family homes in this neighborhood, Oakdowne showed us some got silly desperate. I think we haven't had many sales in this area because there has been an abnormally low inventory of homes (I don't count flippers as homes.

Things always change here though. There is always someone moving back to their home after a year or two, and always people going to homes etc. There are always those who have to sell in Oak Bay, no matter what the market conditions.

Just Janice said...

Assume that the house bought is non-negotiable (we love the location and aren't worried about raising toddlers in close proximity to the ocean, raising them on a yacht is not an option). The timing and the how of doing so are what is debatable....so looking for ideas on this...

Good point about the arch. Assessment we may be able to use that to negotiate a lower price with the owners....

a simple man said...

well...rent for as long as possible and ask them to let you know first when they are thinking of selling. Let the landlords ride the market down as long as possible. You will still be living in house whether you are renting (cheaper for now) or owning (more expensive now and maybe 25% cheaper later).

But the arch assessment is very important - find that out almost above all else.

Just Jack said...

Foreclosure, forclosure - what should I bid?

A recent sale of a condominium in Chelsea Green just sold for $225,000 under a court ordered sale.

Did they pay fair market value or was there a discount for being under duress? Or putting it another way how low can I go when bidding on a court sale?

This property sold twice before once in May 2007 for $245,000. At that time the median condo was $272,000.

And before that in July 2003 at $124,900 when the median was $142,000 for a condo in the core districts.

Comparing the medians of yesteryear with today's median of $295,000 it would appear that a fair market value for the property not under duress would most likely have been in the range of $259,500 to $265,500.

The property just sold for $225,000 under the duress of a court ordered sale which is a 13 to 15% discount from fair market value.

So if you want to feast on condo road kill that's a good discount to keep in mind. Bon Apetite

Just Jack said...

Wow! Fernwood is on fire!

Move over Fairfield and Oak Bay. It's seems nobody wants to live there anymore, they all want to live in Fernwood.

Why?

Me thinks, its the basement suites. The young and the desperate need more income to buy today. So sure the home in Oak Bay and Fairfield are more desirable, but the economics say Fernwood is the place to be.

Anyone remember the Beverly Hillbillies

"Come and listen to the story of a man named Jed, a poor Langforder who barely kept his family fed, then one day as he was shopping at home depot,

up went the price of his Bear Mountain condo.

His kin folks said, Jed your a millionaire,

Victoria is the place you wanna be,

so he loaded up the truck and they moved Ferwoodie.

Better bars, movie stars."

Waiting said...

New FSBO at 2380 Musgrave next to Willows school. Anyone have any info on it?

think said...

A new listing on my PCS - 458 Monterey asking 825,000 but it was just purchased by these people Sept 14th 2010 for 780,000 and it appears no work or improvements have been done. Do you think these people are in trouble or being greedy? Strangely similar situation to 828 Hampshire. Anyway, market hasn't gone up people didn't you get the memo!!!!!

OMC, simple man, waiting, what are your thoughts on 350 Robertson?

Waiting said...

I remember looking at that house on Monterey. It initially listed at something like 939,000 and was adverstised as subdividable I believe. Then the price slowly drifted down to $799,000. I actually thought it was an ok house, but not at that price. The studio would be a nice asset if you had a nanny, older parents, a home office or teens. It doesn't totally suit us though at our age and stage. I imagine it is people in trouble rather than greedy but who knows...
I think 350 Robertson looks nice (I've never been in it) but Robertson is a funny street. Some of the homes are lovely and others pretty run down. It doesn't really suit us either though as we have no interest in having a suite and the basement height isn't high enough (my husband is really tall!) for it to be useable space.
I'm not sure exactly where that house is on Robertson but I'd only buy in some areas of Fairfield as parts of it are in the amplification/liquifaction zone (ie, the ground under your home will sink/disolve if there is a big earthquake). Not everyone cares about that when looking but I tend to keep it in mind.

Waiting said...

A couple more sales in OB. Windsor and Dunlevy.

Al said...

Other than JJ and a few others, it seems most discussions here are about House Hunt OB? Where are the other buyers? Maybe they just aren't this sophisticated or interested to join/post here? :-)

DavidL said...

@ Al wrote: Other than JJ and a few others, it seems most discussions here are about House Hunt OB?

I'm not sure what has triggered the current "love in" on Oak Bay housing ... All I know it that now is not the time to buy unless you have money to burn.

Let's say that you spend $750K for a prime Oak Bay house and the market dips 15% over the next 24 months. The value of you house has dropped $112,500 in the time that you could rent a similar place for $60,000. But hang on, you didn't just lose $52,500 of net worth (that you still owe the bank)- because you also spent $8000 on property tax (for 2 years) and $2000 on property insurance. Your net worth has then decreased by $62,500 - or about $2,600/month (ouch!).

If I were thinking of buying a second home in Victoria, I would approach like buying something at Canadian Tire: I would wait for it to go on sale.

SilverSurfer said...

If you're wondering why people continue to buy way over priced houses in Victoria and Vancouver, well you can blame it on TV raising people's aspirations.

Watch this hilarious 13 min British critic of what's wrong with our modern society, and how people don't live in houses anymore, but "Giant coin shitting machines that are part of a collective delusion". Too funny.


In other news, it looks like the Chinese goverment has finally suceeded in crashing their housing market. Will this mean Richmond prices finally start tanking? Who knows, but the first month results are in... Sales crashed 45% month over month, and prices dropped 26.7%. Can't wait to see what this looks like 6 months from now. If the numbers sound shocking, so was their arogance to print 3x more money than the USA during 2008 crisis as a ratio of GDP. Printing has consequences folks.

Speaking of which, your dollars have been further devalued (even if they went up slightly against USD). Yep, this week, you'll need ~9% more of them or $43, to buy 1 oz Silver.

omc said...

Think,

I too haven't looked into that house on Robertson for similar reasons to waitings, except It's me that finds low ceilings challenging. I don't include finished attic or low height basements as true finished space. It seems like an awful lot for such a small house in that neighborhood. The pics also show some very questionable things, such as the very low height door leading to outside with the stairway down without a railing. Personally I wouldn't take the time to look at it.

How 'bout we have a game of most overpriced house in Victoria? My entry is 1587 Monterey; this house is literally falling down! They are asking $740k for it, and it is a busy/noisy location. I would place it at lot value, and while it is in Oak Bay it is still noisy/busy. If other lots in prime locations are $550k, I would give this house a value of $450k

a simple man said...

@ think - I lived on that block of Robertson - busy area. I agree on the low height consensus - not to be considered usable floor area, except for storage.

1912 - my first thought when looking at it was "money pit". I have lived in a few character houses and owned one. I won't make that mistake again. I call them "building character" houses.

@ Al - my interest is in OB because that is where all my kids go to school. I leveraged all of my good will to move my family across the country and we selected this neighbourhood from the start. I can't move them again without a lot of heartache - they already love it here and have a great group of friends, as do we.

Why there seems to be a large cohort of people talking about buying in OB (some day)? No idea, other than perhaps people that want to buy in others areas do b/c they aren't as overvalued as OB.

a simple man said...

@ omc - my votes are for 2857 Dewdney Ave at $749K (tear down) and, of course, 1955 St Anne at $839K (insult to intelligence).

Waiting said...

Gosh...it's hard to pick as there are so many contenders. My vote is going to 416 St. Charles. Original price $849K dropped to $729K for a 1200 sq ft, ugly, dated, rancher on a busy street. 8100 sqft lot and they claim it has subdivision potential.
There are a few contenders in Cadboro Bay too!

Watching and waiting said...

my vote goes for this teardown/pandora's box:

$649,000
MLS® 285387
4 Beds, 2 Baths
lot#4-4035 Braefoot Rd

and this new overpriced/languished relist from last spring:

$799,900
MLS® 291820
4 Beds, 2 Baths
1990 Cromwell Rd, Victoria

omc said...

I saw that one on Dewdney last year. What a POS!

The woman had painted everything in the basement, floor joists and all, and was claiming it as finished space. She had taken a beginners art class and had actually painted a whale on the basement floor and all sorts of stuff all over the basement. She had a big book explaining the significance of each one, and how upset she was when they removed the oil tank as she had done such a nice job painting it. I only stayed a minute, but remember that one of the windows (to the outside) wouldn't close because of settling. They had also done a pre inspection, but it didn't show well for them with insect infestation and water damage/rot.

I still have you beat though, as the property value is higher there.

Watching and waiting said...

sorry one more overpriced/languishing listing to add to win the big prize:

$689,900
MLS® 286091
5 Beds, 2 Baths
2082 Meadow Pl, Victoria

interesting disciplinary decision on this particular realtor ..

http://www.recbc.ca/complaints/discipline/MichaelHanus.htm

not your usual slap on the wrist; pay $500 and say your sorry.

omc said...

Good call on the Cromwell house, saw it last year too. They are still sitting on that price! The listing was so misleading last year I could tell it bothered the realtor who showed it to us. It showed this huge, unfinished full height basement, but was actually an exposed rock crawl instead. You could see where the water ran down the rock face! They should have listed it as an inside water feature.


We can call this contest "The Victoria Turkey Call".

a simple man said...

@ omc - you do have me beat in land value.

@ watching and waiting - that Meadow one is painful to watch. The owners have bought and moved before assuring their place was sold. They are surely feeling the pain - but apparently not too much as the price is still $40,000 above their last price offering last yr.

Dave said...

4 sales reported on my PCS account today-saanich west. all under assessed, first 3 on average 25K and 4th was about 80K

Dave#1

Leo S said...

Yep, a "big" week for sales of SFHs 550-900k. 19 sales this week, which is almost two thirds of the sales before the mortgage changes.

Same old for the under 550s. Sale price to assessment recovered somewhat due to the house on Catherine st which was assessed at 323k and sold for 412. Otherwise looks pretty boring.

DavidL said...

@ SilverSurfer wrote: Watch this hilarious 13 min British critic of what's wrong with our modern society, and how people don't live in houses anymore ...

Thanks. That video was awesome. My wife and I thoroughly enjoyed it.

I'm glad you silver investments are paying off (literally!) I wish that I had a spare $125K to invest last January.

Mark said...

Michael Hanus link doesn't work can you repost?

Watching and waiting said...

go to :

www.recbc.ca

click on "complaints and discipline"

click on 2009 disciplinary decisions
or
here's the direct the link again (cut and paste):

http://www.recbc.ca/complaints/discipline/MichaelHanus.htm

Watching and waiting said...

let me try that for the last timen, the link appears to get cut off when I submit my comment:

http://www.recbc.ca/complaints/discipline/MichaelHanus.htm

JustWaiting said...

I know the bears are keen to see the numbers tomorrow. Here is an early update for you.

According to a local realtor I know tomorrows numbers are going to be bad news again for sellers and agents looking for a commission.

This morning the VREB database showed 130 sales in the last seven days. Last Sunday I reported around 113. This time of the year is peak selling season and there should be at least 160 sales a week and in good years around 175.

New listings totalled 331 which is typical for the spring. Total MLS listings are about the same as last week.

Price changes are seen everywhere. About 215 in the last week. This is up from the 190 I reported last week. More nervous sellers??

Total sales so far this month is just under 300. Given that we are halfway through the month and Easter is next weekend it is highly unlikely we will hit 600 sales which is lower than last months 622. Here are some April stats from past years.

2010 - 756
2009 - 747
2008 - 730
2007 - 898
2006 - 780

This market is so... over. Look for price changes and a falling market starting next month as sellers that need to unload panic. May is the peak for sales every year and by June sales always start dropping significantly every month. This year it will be worse and with the high inventory there will be market pressure to reduce prices. Buyers will grind the sellers hard once the facts get out.

Introvert said...

This market is so... over.

You wish!

Look for price changes and a falling market starting next month as sellers that need to unload panic.

Nobody is going to panic.

This year it will be worse and with the high inventory there will be market pressure to reduce prices.

Ha! How many times have we heard this? No, there won't be much market pressure to reduce prices. Sellers will keep asking what they're asking until they basically get it. That's what's been happening, and it will keep happening.

Buyers will grind the sellers hard once the facts get out.

Good one! I can see it now. Buyer says to seller, "Guess what, buddy, I know the facts and you're going to have to lower your price!" Seller laughs uncontrollably.

omc said...

/\
Don't feed the troll

JustWaiting said...

Introvert said in an earlier post.

a simple man, I think the current real estate market is fine right now. Prices are declining slowly, but I don't predict a snowball effect culminating in a market crash. I think the market is in the midst of a correction, which is healthy for us. Not sure how much it will correct or how fast, but I doubt either will be drastic.

That's my analysis because you asked for it. For me, day to day, I don't really care what happens to the market. I'll start caring 25 or 30 years from now, when I go to sell my house. Until then, the market can fluctuate all it wants.


Introvert - Glad to see that you agree that we are in the midst of a correction. As I said above we now have the worst March and April sales in over 5 years and this coupled with high inventory will only make things worse.

If you are a happy long term owner then why are you reading this blog and only commenting on what others have written? I see that you have not made any original posts of your own for others to read and critique. Surely you have other things to do if you don't care about the today's market and its fluctuations.

We have had many "happy owners" drop by in the past and you seem to fit the same profile. I bet your motives are really one of the following:

- Nervous about what your own house is worth in spite of what you said earlier. So you read this blog, the only other source of real estate stats and commentary for Victoria. Then you start feeling uncomfortable with what you read.

- Bored and looking to poke the bears. This is called being a troll.

- A superior attitude because you bought a few years ago and you believe renters are 2nd class.

If you aren't one of the above then try contributing some of your own original ideas, comments and facts to back up your point of view instead of just sniping at what others have posted.

a simple man said...

@ Introvert - glad you are still around - gives validity to this board that we have people commenting contrary to what most of the people here believe - makes you gut-check regularly and I appreciate that.

You are right - I do wish this market to be over b/c it is unsustainable and it is now hyperinflated. Many good people will end up in financial ruins when the market corrects and the longer it stays inflated, the more people at high risk are sucked in.
And people are staring to panic - I know of two houses within blocks of where i love now that are on the market and the sellers are really panicing b/c they see the market correcting and they have bought other homes before their current home sold.

Sellers will grind other sellers. And none will be laughing.

Marko said...

Let's look at 1991 - 5,496 SFH sales for that year.

In 1992: 5,103 (7.15% down over 1991)
In 1993: 4,220 (17.30% down over 1992)
In 1994: 3,608 (14.51% down over 1993)
In 1995: 3,117 (13.61% down over 1994)

The average SFH price in 1988 was $127,888 and by 1992 had risen to $222,415. So prices increased significantly in 4 years, and then we saw three years of slowdowns in sales...what happened to prices?

1992 - $222,415
1993 - $246,727
1994 - $256,025
1995 - $242,012

I can't see prices dropping significantly in the short term due to sales volume alone. There needs to be another trigger, i.e. rates going up significantly, a serious downturn in the economy, etc.

I've seen estate sales in Victoria going for a year plus on the market. There is the occasional seller that needs to dump quickly but not a true reflection of the overall market. I've written a lot of offers in the last 2 months and surprising how many properties are mortgage free in the core.

a simple man said...

Marko - I think the economic pressures today are so different from those in the early 90's. It is hard to predict what will happen in the market now base don what happened 20 years ago. We live in a much different world, one with HELOCs and 35 and 40 year mortgages coming due. On top of exponential price growth in the past 8 years. It is unprecedented. And like any other exponential increase, unsustainable.

JustWaiting said...

Here is a screenshot from my PCS showing activity in the last three days. As you can clearly see nobody is panicking and cutting prices.

Sidney-Colwoood-Sooke-Malahat 300K-600K

Waiting said...

Think,
Robertson sold for 805K - 30,000 over asking. Guess I called that wrong!!

Introvert said...

Robertson sold for 805K - 30,000 over asking. Guess I called that wrong!

Sellers are panicking!!!

Reid said...

Introvert is correct. Most sellers will not panic. The few that do will sell as there is always demand here in Victoria for houses sold below the current market. Real price declines will come when demand is consistently below historical levels. By this I mean down 40% to 50% (like we saw in late 2008) for many months, not 10% or 20%. Buyers need to go on strike or be forced out of the market. Unless there is a major economic event or big hike in interest rates, this is likley to be a very protracted decline and bears need to be patient.

Craig said...

Marko

First, the run-up to the prices we have today is unprecedented and some sort of return to the historical price-rent ratio is inevitable.

Second, I had a quick look at Victoria prices for the first half of the 90s you mentioned and it showed that prices were actually flat for the entire decade. With inflation averaging about 2% a year, a $250,000 house bought in 1990 had lost about a fifth of its 'value' by 2000.

Not a huge loss to be sure, but not a good investment either.

a simple man said...

I am patient bear. 1 yr, 2yrs, 3 yrs. No matter.

Kelly said...

someone said...

"There needs to be another trigger, i.e. rates going up significantly, a serious downturn in the economy, etc.”

I'm thinking gasoline prices as high as 2008 and higher food prices are similar to a big interest rate hike?

My worry is our government might not be able to save economy this next downturn like they did in 2008.

Leo S said...

Maybe we buy next year, or maybe we buy the year after. If it's still flat until then, we've saved money. If it's down, we've saved more. It's a a win #winning situation.

jesse said...

Sellers set price, buyers determine turnover.

Nonetheless, nobody is holding a gun to anyone's head making them buy, unless you have a nesting spouse :P

SilverSurfer said...

I've convinced my soon to be nesting spouse that our kids won't care if they live in nice rental vs a nice home until they are well into their teens. Besides, she's not from North America and actually understands that paper is paper and gold is real money.

So in today's news it looks like the BoC may not be raising interest rates this summer or even until end of the year. 1st Half gain, 2nd Half Pain

"The interest-rate differential with the United States already attracts higher capital flows, which in turn put upward pressure on the loonie. Further rate hikes, while the U.S. Federal Reserve is expected to hold steady until 2012, will only exacerbate the problem.

“That process becomes self-fulfilling,” Mr. Bethune said. “The capital inflows push the Canadian dollar up higher, which then rationalizes more capital inflows. You get this cycle, which can continue for some period of time.”

Many are anticipating the central bank to raise rates midJuly, at a time when second-quarter results will become apparent. But those results could prove disappointing, Mr. Bethune said. “It could well keep the Bank of Canada on hold through the end of 2011” he said."


I saw this coming a while back when Flaherty, in the absence of a rate hike changed mortgage rules to calm the markets. The 2008 crisis was over 2.5 years ago now (my where has time gone!) and we're still talking about it weekly in the news.

The reality people, is that the global financial system is actually worse than pre-2008 crisis. I could write a 5 page essay on this, but as I've done several times before (as MR.4AM), I'll give you the point form for the noobs:

1. Euro-zone debt crisis deepening. Watch Spain say "We don't need a bail-out" later this year (that's the warning sign they're months away from needing one).

2. China's real estate bubble is finally *just* starting to show signs of popping.

3. USA's deficit is at a record 14.x trillion and climbing. Watch for the debt ceiling to be raised later this month. I won't comment on the real estate scenario as you guys know it's far from over. Do however look up their 43+ state muni bond crisis. US dollar index is 4 cents away from an all time pre 1972 low! If it breaks $70.17, the Niagara falls will no longer be the world's largest water fall.

4. Japan is fukushima'ed. Nuff said.

5. Middle East/MENA civil revolutions. Still waiting for Saudi and Yemen to see revolts. Looks like Lybia will be ongoing for a while.

6. Global commodity inflationary explosion; oh but dont worry, since you don't need to eat or use oil for transportation, it's not considered part of core inflation (CPI) calculations. So the BoC will claim low inflation and hence no need to curb inflation by raising interest rates, just as the above article did.
.
.
.

SilverSurfer said...

.
.
.

Anyway, my point is, we could be in very low interest rate "recovery mode" for a while to come. Any realtors reading this, please wipe your drool, there's still plenty of things going against rising Victoria housing prices - I for one, hope Flaherty comes back for round 2 (or is that 3?) and slaps some more tightening rules into the market. Still waiting for the 20% down, 25yr mortgage; granted, at the current pace, Canada will probably have a majority government before that happens (yes, I'm being sarcastic).

But anyway, given interest rates are the #1 house price killer, and the BoC is likely to hold off or risk our dollar rising into the stratosphere; despite our new all time historic debt levels and CMHC chamber of secrets, the CDS spreads on our bonds are still so green they are off the charts as grass (well at least compared to the PIIGS).

So, I'll say it again, without a continous interest rate hikes starting this summer, I just don't see a *significant* Victoria RE collapse in 2011. And just in case you're mis-reading me - that's NOT a buy signal. One day, maybe in 2014, 2015, or whenever... I'll gladly trade a roll of silver maples for a cute cozy apartment in Cook St Village.

Kelly said...

At our first golf round of the year yesterday some banker investment guy joined our threesome. Near the end of our round I asked where we should have our money now. It took a little prying but he more or less told us where we don’t want it. He said rates would start rising a lot this next year, and to keep lots of cash handy. He also said our resource sector is about to get as comodities are at the top of a cycle. I wanted to ask what that meant for real estate but didn’t get the chance.

Leo S said...

I bet he loves to work for free on a sunday. ;)

Marko said...

Monday, April 18, 2011 8:00am:

MTD April
2011 2010
Net Unconditional Sales: 299 756
New Listings: 846 1,783
Active Listings: 4,211 4,229

Please Note

•Left Column: stats so far this month
•Right Column: stats for the entire month from last year

a simple man said...

So, 132 sales last week. Low.

I wish we had a stat for relists and price changes - that would also tell us a lot.

Early last spring a price change was a rare, rare event.

JustWaiting said...

Simple man,

I posted the price change stats earlier. Here is the other info you wanted.

April 3-10
- 405 New listings
- 16 Back on market
- 191 Price changes
- 113 Pending sales

April 10-17
- 331 New listings
- 12 Back on market
- 215 Price changes
- 130 Pending sales

BTW - None of the people making those price changes are panicking or are nervous about not getting an offer after a few weeks of listing. They were just testing the market or decided to give the buyers a better deal.

a simple man said...

thanks JustWaiting - these stats are great as they do provide a glimpse at seller psychology, which is the most important factor here.

Just Jack said...

It's so important to do your homework when buying properties in Victoria. One of the more difficult properties to get a handle on what it's worth are strata titled half duplex homes. Especially if they are situated in above average desirable areas like Fairfield.

For example, a half duplex on Fairfield just sold for $651,000 or about $300 per square foot.

However, back in February there were fewer properties to choose from and the other side of this duplex sold for $780,000 or about $312 per square foot.

That's a $129,000 difference for what should be highly identical side by side homes.

One of the good things about markets like this, is that it takes away wealth from the unworthy and puts money in the pockets of the wise.

omc said...

I'd like to point out that we are looking to be some where in the 20-25% lower range comared to last year for sales. What is interesting is that last year we peaked in March, slumping through the rest of the season causing price corrections later in the year. What do you think the likelyhood of a 5% price correction is this year? I think the buying pool wil get a bit shallower soon.

I looked at a few houses over the weekend and our realtor gave us a bit of a pep talk. A pep talk on how patience is a virtue right now.