Monday, November 21, 2011

Monday market update

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.

November 2011 (last week's numbers)
Net Unconditional Sales: 314 [200] (90)
New Listings: 570 [369] (201)
Active Listings: 4,218 [4,265] (4,503)
Sales to new listings ratio: 55%

November 2010
Net Unconditional Sales: 479
New Listings: 722
Active Listings: 3,723
Sales to new listings ratio: 66%
Sales to active listings ratio: 13% or 7.7 MOI

This market is flatter than a Saskatchewan cow pasture. Not much else to say. Fifteen sales a day makes for a very boring market (and some hungry agents). Perhaps that's the plan: bore us to death so we stop paying attention, and commenting... *takes tinfoil hat off*

121 comments:

JustWatching said...

Today's National Post...

How I stopped worrying and learned to love the bubble

So is our housing market in the midst of a bubble? “It seems reasonable to view housing as bubbly — well beyond effervescent,” wrote Finn Poschmann, vice-president of research at the C.D. Howe Institute in an email to the National Post. “Bracing for a winter of discontent would be wise.”

If the Canadian housing market were to collapse, Canadian taxpayers would be hit hard. The federal government is fully liable for any losses incurred by the CMHC, which currently backs somewhere in the order of $600-billion worth of mortgages. It has been bailed-out by the government twice in the past.

a simple man said...

Who is buying now? There was always that kid in the corner eating glue.

Marko said...

Maybe that kid just dropped 6.5 million on a beach drive property a few days ago?

Leo S said...

Maybe that kid just dropped 6.5 million on a beach drive property a few days ago?

He's a glue mogul these days?

DavidL said...

In the previous topic ...
@Bob wrote: The question to this blog is, Should we rent? Part of me wants to rent, but it may take longer than 2 years for prices to correct significantly. Your thoughts?

If you are only looking at the finances (rather than the emotional side of buying your "own" home), be sure to include the cost of property insurance and homeowner insurance. For my modest Saanich house, this costs be about $300/month. Then add on another $150/month for material costs to maintain your house (for essentials such as paint, flooring and an occasional new roof). This value does not included labour - so be prepared to spend some evening or weekend hours DIY.

You may quickly find that home ownership costs add up in a hurry ...

Alexandrahere said...

Hi: My stats for 14 - 20 Nov. SFH in the areas of Vic,OB,Esq,SE&SW with a min of 2 beds and 2 baths, priced between $375K & $575K.

New: 24
Sold: 22
P/C: 35
OM: 14

Avg Price: $596K
Med Price: $577K

13 out of the 22 sold went for below BC assessment and almost half advertised as having secondary suites.

Condos & Townhomes prices between $260K & $575K min 2 beds & 2 baths in most areas of Vic, (not downtown), all areas of Esq & Oak Bay, most areas of SE & Tillicum, Gorge, Burnside/Interurban of SW:

Avg Price condo: $304K (3 sold)

Avg Price t/h: $406K (sold)

All townhomes went for below BC assessment as well as 2 out of the 3 condos.

If BC assessment authority doesn't lower its assessments next year, they will have many owners putting in a grievance. Doesn't matter though.....its a lose, lose....the mil rate will just be increased .....so the tax payers will still pay the same or more but they will also be faced with the facts that they are not worth as much and or they are financially more in the hole than they thought.

a simple man said...

Cool Marko - what was the initial asking price of the $6.5M shack?

Marko said...

6.5 million was also the asking, it wasn't on the market very long.

a simple man said...

good for the sellers - must have been priced well. I know there is one in Metchosin for $20 million or so that has been for sale for 3+ years.

Anton said...

The metchosin one claims to being sold at a fraction of the building cost. Bummer for someone if true. Those estates pale in comparison to Hatley Castle (Royal Roads) and grounds. Interestingly it too was sold at a discount, for 75,000 in back taxes during a previous real estate downturn if memory serves.

a simple man said...

I know the couple in Metchosin selling. Sad story really - health issues preventing them from enjoying their retirement dream.

Leo S said...

So much for multiple offers. 2636 Scott Rd sells for $323k, well under the asking price of $339k.

The almost identical teardown at 2851 Scott sold for $30,000 more in a bidding war.

Leo S said...

To add to the fun, the relisted 2851 Scott Rd sees the sale and drops their price by.... $2000 :)

Marko said...
This comment has been removed by the author.
Marko said...

Leo_S,

2636 Scott was a very very unusual situation. That is all I can say.

Zidane said...

re: scott road. Almost identical but being on the other side of the street, so further from Shelbourne, is a big deal as far as i'm concerned.

JustWatching said...

Bob,

POsted some comments about property transfer tax in the previous topic.

How did you make out with the spreadsheet?

Marko said...

"re: scott road. Almost identical but being on the other side of the street, so further from Shelbourne, is a big deal as far as i'm concerned"

A little more complicated than that.....

Zidane said...

ok, Marko, so you're obviously itching to tell us...

Animal Spirit said...

2851 Scott. Look closely at the pictures from the listing before the first sale. Notice the shing new oil tank. Notice also that there were 10 bids and likely an unconditional offer. Read the new listing

"This amazing fixer-upper is available AS IS with the underground oil tank removed after completion or have it custom renovated by seller for a great package deal"

Me thinks someone bought the place unconditionally to either do a build or to flip prior to the sales contract running out. Then found an underground oil tank and either the buyer or the bank got spooked.

Anyone want to do a soil test on the site?

Animal Spirit said...

that should be 'shining' new oil tank...

Leo S said...

A little more complicated than that.....

Oil tank in the backyard... full of bodies! That's a definite resale killer.

Anton said...

A little more complicated than that....

An ancient first nations oil tank requiring archaeological assessment.

Zidane said...

Anton: nice one.

In Vancouver there is a bylaw (or whatever) to the effect that the buyer can insist the oil tank be removed. During the mild downturn in 08 I went to open houses where the OT removal certificate was on display. Since then in Vancouver, the land of multiple bids, the seller can just ignore buyers who insist on this rule being followed.

So what about Victoria - is there an oiltank bylaw?

Just Jack said...

I don't believe that there is a bylaw like this. I believe that in the USA, some cities have a bylaw that the tank has to be replaced every time a home sells.

My neighbor has an outside oil tank that is now 35 years old (original tank from when the home was built). From time to time, he scrapes off the rust and paints the tank to make it look fresh so that the Oil company will continue to fill it.

While in some cases it may seem unnecessary to make people replace the oil tanks. I believe, cities should take the potential for oil spills much more seriously.

CanSpeccy said...

Globally, debt is now 35% of GDP.

German bonds are not selling today.

The CAN$ has dropped a couple of cents in the last day or two.

The BOC may not be free to keep real interest rates at less than nothing indefinitely.

CanSpeccy said...

Sorry, that should have been:

Globally debt is 350% of World GDP.

Chris said...

Hooray, Canada takes the bronze medal in the global debt owelympics. 450% for the Euro zone and the United Kingdom; 470% for Japan, and 410% for Canada. http://www.marketoracle.co.uk/Article31044.html
Much higher than USA and the world’s average of 350%. Thanks fellow Canadians for a fun-filled future of falling property values, rising rates, unemployment, high taxes to bail out CMHC, ad nauseam.

Mindset said...

Is it just me, or is the financial world coming unglued? One week, everything is fine... the next, everything is falling apart, then everything is bright, and twp days later everything is dark.

I've been around long enough to know that there is no way that the real world is moving at anywhere near the speed of the news or the markets these days.... unless we really are balancing on the edge of a cliff.

Introvert, Eatme... you gents out there with some rosie optimism this week? I think we could all use a shot.

Marko said...

The markets have been crazy and not very rationale. I picked up Suncor again today....oil at $90+ and Suncor below $29....

Leo S said...

2636 Scott Rd relisted at $343k

What the frack is going on over there? Did a cannery explode? Cause it smells awful fishy...

Leo S said...

Also what's the difference between Possession being marked as "Immediate" vs "Upon completion"?

I'm thinking of adding that to my stats (percent of vacant homes, which I assume would be those marked as immediate).

Zidane said...

Re. oiltanks. Oops I meant underground tanks have to be removed. If seller doesn't offer certificate either they haven't had a search for it or they have and don't want to discuss it...

Marko said...

I told you guys it was complicated ;)

patriotz said...

"Is it just me, or is the financial world coming unglued?"

It wasn't glued in the first place. Hasn't been for well over a decade.

Introvert said...

Introvert, Eatme... you gents out there with some rosie optimism this week? I think we could all use a shot.

Don't worry so much; life's too short.

a simple man said...

Character junkies outbid one another for house on Oliver. Final sale price $75.9 million!

Marko said...

And the SFH average is up to 928k for the month!

Jason said...

$75.9 M? Please tell me there is a decimal error there. They could probably have bought Arizona for just a bit more. Much better weather.

a simple man said...

885 Oliver St OB South Oak Bay $75,900,000

Realtor's typo. A big one. Still, was bid above asking of 729K (should be $759K)

a simple man said...

On another note - do you notice very retailer almost has everything on sale and has been for months? How long until this trickles down? How can we ever say this is a healthy economy?

Introvert said...

Here's a huge reason why Victoria's house prices are much, much higher than Halifax's (and always will be).

Leo S said...

Here's a huge reason why Victoria's house prices are much, much higher than Halifax's (and always will be).

What's wrong with snow?

Here's a message I received yesterday from a friend that recently bought a house:
"PS: Don't rush to get a house, my basement flooded last night and I'm missing the benefits of renting right now..."

a simple man said...

Introvert - I agree - we will always pay a premium for our climate here with reference to the rest of Canada. Why it is more here than Seattle? That is a bit tougher.

As someone that has lived 3/4 of their life with true Canadian winters - snow sucks.

Introvert said...

"PS: Don't rush to get a house, my basement flooded last night and I'm missing the benefits of renting right now..."

Are we ignoring the importance of buying a house that is structurally sound?

a simple man said...

Sometimes basements will flood and you have almost no control over it even with great structure.

patriotz said...

"Here's a huge reason why Victoria's house prices are much, much higher than Halifax's (and always will be)."

Why aren't rents much, much higher then? Renters get the same weather as owners.

a simple man said...

What are the rents in Halifax?

I would not be surprised if they were similar to here. The rents in my last home in the prairies were similar to those here.

Leo S said...

As someone that has lived 3/4 of their life with true Canadian winters - snow sucks.

Speak for yourself. Snow is much preferable to rain in the winter.

Are we ignoring the importance of buying a house that is structurally sound?

A mythical beast.. Hard to find under $500k. It is an unappreciated danger for those swept up in the excitement of buying their first house.

a simple man said...

Leo S - isn't it awesome we can all appreciate different things? True enough, there are people that prefer the snow to the seemingly never-ending rain. So, then perhaps the mystical weather quality of Victoria is over-valued?

Leo - if you prefer the snow, why are you still here?

Just Jack said...

There is no co-relation between weather and home prices. I wouldn't try to make sense out of Victoria's or any other place in Canada based on physical aspects.

These prices have been created by financial causes. Prices are high in Victoria, because prospective purchasers in Victoria have the ability to finance at higher levels than others.

Hence property values are directly related to the number of mortgage brokers and real estate agents per town. Afterall, when they bend over - do we not see sunshine?

Introvert said...

Speak for yourself. Snow is much preferable to rain in the winter.

Got it. Lots of people love snow. But guess what? 95% of all Canadian cities receive a lot of snow. Supply of homes for snow-lovers is virtually limitless.

Supply of homes in Canada for snow-haters is much more limited. Again, if one wants to purchase a house in the warmest, least-rainy, medium-size city in Canada, one looks to Victoria first (if you have the money, that is).

Trilobite said...

There is an interesting article in the Economist House of horrors, part 2. Canadian house prices are mentioned to be 25% overvalued or more ... ouch!

Leo S said...

Leo - if you prefer the snow, why are you still here?

Turns out snow doesn't pay the bills.

Just Jack said...

If you have that much money -why not go to Arizona for the winter?

You can have the same weather with prices starting a hundred thousand dollars less in Sooke.

Brentwood Bay?
Sidney?

All cheaper and the same weather.

I don't think its snow haters that have driven up our prices over the national average in Victoria. Because these people would also hate rain, and nature in general.

Yesterday, I was out on the beach collecting seaweed for the garden. A very light drizzle and not much wind. I think there was a total of 6 people on Willows Beach and three parked cars. Obviously this town has a lot or rain haters too.

If snow worries you so much - then you'll end up being shut in your house for any insignificant reason. It's too rainy, it's too cold, it's too dark, it's ...

Anyway, I'm digging out the sled and hoping for snow. This year, my daughter and I have decided to play hookie form school and work and are going to Beacon Hill park for snow rides all day long.

Try that in the rain.

a simple man said...

Leo S - that is a rare person that is stuck in Victoria because of a job they have here that could not be had elsewhere. If that is you, then you are lucky/unlucky depending on your viewpoint. Nice to hear of a well-paying job here, though.

Just Jack - you are right - I am at Willows Beach most days of the year, and mostly early or late. it is amazing how the place is abandoned in the winter - I often see not another soul. In the summer, if I go in the day, I always leave with the thought "How did everyone find out about my beach?"

HouseHuntVictoria said...

" if one wants to purchase a house in the warmest, least-rainy, medium-size city in Canada, one looks to Victoria first"

Can't believe you still dig this beauty out after being corrected so many times by the data. There are fewer "ones" than you think. More people choose elsewhere.

There's a lot better explanations for why Victoria's valuations are where they are without having to make stuff up.

a simple man said...

"Canadian workers are failing to keep up with the rising cost of living as real wages continue to fall dramatically, new data from Statistics Canada shows."

cbc.ca

JustWatching said...

HHV,

Introvert doesn't base his point of view on data or hard facts. He just uses anecdotes, mythology and "arm waving" when he posts.

But that is what trolls do...

Introvert said...

There's a lot better explanations for why Victoria's valuations are where they are without having to make stuff up.

My explanation is as made up as yours (yours being that Victorians drove up their own prices).

Why didn't Haligonians drive up their house prices to very high levels? Kitchener? Regina? Windsor?

Just Jack said...

During the rise in prices, NOT ONE city in BC had house prices decline. Even as people were leaving towns like Port Albernie to go to Vancouver and Victoria for jobs. Home prices rose in these towns. Not because these towns had more jobs or rising population -but because of falling interest rates.

Victoria followed right along with every other city in BC. The rise in prices had very little to do with physical aspects of a property or location. It was almost entirely related to financial considerations.

You paid more for a home because - you could. The more brokers pushing deals that you had in a town, the higher the prices went. It was a great big cluster #$@%.

a simple man said...

Honestly - how much more before the economy/housing market becomes unhinged? It seems like it is right on the precipice now. All the news we hear is 90% negative when it comes to financial topics, yet houses are holding strong somewhat. Soon someone will blink and this house of cards will come down. It is silly out there now.

Leo S said...

Leo S - that is a rare person that is stuck in Victoria because of a job they have here that could not be had elsewhere. If that is you, then you are lucky/unlucky depending on your viewpoint. Nice to hear of a well-paying job here, though.

Two things: First, Victoria has the government, the university, and the department of defense. All of those are solid jobs, although of course the pay does not approach what one could earn in the private sector.

Secondly, I'm not complaining about Victoria, it's great. I'm just providing a counterpoint to the prevailing opinion that it's the best place to live as far as weather goes. There are tons of other places in Canada that are just as good. Not the same, but good for different reasons.

Leo S said...

What makes the west coast so bubbly? Hard to say. I don't see the logic in saying Victoria prices are high because prices are high everywhere in BC. Or that they are high because of pushy realtors and mortgage brokers. Those are everywhere. And yet somehow we have had pretty strong appreciation in real estate, and very few and shallow downturns.

Why is that? Who knows. But a colleague of mine lived in California for about 30 years from the 1960s on, and the saying was always "you better not leave California, because you'll never be able to afford to come back".

They don't say that in California anymore.

a simple man said...

Good points, Leo. I think that we are in a different position historically than we have ever been in so it is hard to predict where this is all going to end up. I doubt that it will turn out well, though, in the short-term (10 years).

Just Jack said...

Prices aren't high in Victoria because they are high everywhere else in BC.

Property values everywhere in BC have increased over the last decade, even with declining populations and rising unemployment.

In the bigger cities in BC, this rise in prices was more extreme. The bigger the city, the bigger the price escalation. And that's related to the amount of brokers and lenders willing to stretch on a deal. In the smaller communities if the deal did not come together, there were few places left for the prospective purchaser to shop. I also feel, that in smaller communities, there is just a little more honesty and due diligence.

Its the law of survival in the concrete jungle. You gotta make a kill to feed the family. And the next house horny 20 something that walks through your door - is lunch.

patriotz said...

"Supply of homes in Canada for snow-haters is much more limited."

Then why aren't rents higher?

Places that have an actual shortage of housing (like Ft. McMurray) have very high rents.

Introvert said...
This comment has been removed by the author.
Introvert said...

Then why aren't rents higher?

Because we don't want to upset you guys; you're helping pay our mortgage, after all.

Just Jack said...

And I appreciate it, Introvert.

This year, I want the flooring replaced and the interior painted. And a new shed too.

If I don't get these things, I will be serving notice that I intend to vacate.

We will be on vacation in Europe for three weeks this year, so I want all the work done then.

I think I will serve notice right around property tax time.

patriotz said...

"you're helping pay our mortgage, after all."

What would you say about any business whose customers are only "helping" to pay their expenses? A renter should be paying all expenses plus a profit for the landlord.

So how does the landlord plan to make money if the renter is only "helping"? By selling the house for enough of a gain to make up the deficit. But that means the next owner will have an even higher deficit, and can make up for that only by selling for a still higher gain. Et cetera.

And how does that necessarily end?

Paula said...

Leo said, “All of those are solid jobs, although of course the pay does not approach what one could earn in the private sector”

Why does this rumour continue to spread in government circles?
It’s simply not true – government has outdone the private sector in terms of real pay + benefits over the last 10 years, resulting in 8-17% more pay for govt workers. See this pdf: http://www.cfib-fcei.ca/cfib-documents/rr3077.pdf

A few comparisons with friends and family support that data, eg., high-school-educated public sector workers like a ferry cook that makes >$70k, a hospital secretary with >$75k, a municipal HR assistant with >$80k. Compare this to a private firm's tech support or IT personnel that might make $50-60k after spending time and money (thousands of $) for a 4-year university program.

The private sector also doesn’t include any pensions, and has cut back on medical and dental benefits, and if you’re lucky to work for a company that contributes a few peanuts to your RRSP, they’ve cut back on that too.

In fact, several of those people who worked in the private sector moved to government jobs for exactly these reasons.

a simple man said...

Today, my wife and I had our quarterly meeting on housing and our purchase of one eventually. As typical, we did the rent or buy tool on this page and then I do a cost of renting calculation. Well, in the end, without making an exhaustive financial list, we are more than $800 in the black each month by renting (ie. we save $800 over our rent vs buying).

Renting in the black is a great place to be if the market is flat or declining, which it is. When the market corrects, then we can purchase the house that makes sense. Until then, we will continue to save money, which we do actively.

I know my landlord has spent likely $10K on the house this yr alone.

Also, the amount of time that renting has freed up for me is an intangible.

So, the results of our quarterly meeting of the Bank of Simple Man and Complicated Woman is to stay put renting and await the almost certain decline.

Waiting isn't hard when you are saving money. Better than buying now and watching tens of thousands disappear.

Alexandrahere said...

Leo: Have you looked at what a leading seaman/corporal makes in the armed forces? (depends if you are a cook/supply person/weapons tech/etc) It is a given that you will have this rank in three or so years of employment. i.e. without competion with others and as long as you keep your nose clean. I would challenge your assumption that an individual (with the equivalent education)in private sector for the most part (on an average) makes more. And believe me.....the benefits that armed services personnel make in terms of paid leave is far superior than the average joe/jane on main street gets.

Leo S said...

It’s simply not true – government has outdone the private sector in terms of real pay + benefits over the last 10 years, resulting in 8-17% more pay for govt workers.

Not in my field of work. More money in the private sector for sure. And my wife's job has no equivalent in the private sector.

Leo S said...

Have you looked at what a leading seaman/corporal makes in the armed forces?

No, but I'm sure all those private sector corporals make a ton less, right?

a simple man said...

Leo - in my field, private sector is double public if you are bright.

Al said...

" if one wants to purchase a house in the warmest, least-rainy, medium-size city in Canada, one looks to Victoria first"

We did exactly that and moved here. My brother would do the same if the housing is cheaper. It doesn't matter raining or not, we can do long walks outside most days here, try to do that for one hour in Ottawa under -10C, and you will know what I meant. Also we don't need air condition in summer and use less heating energy in winter, property tax is also much cheaper (as city does not need much snow removal budget), the list goes on ...

Regardless one owns a house or not here (we do), we do love Victoria, even we may go away in Jan to get some sunshine ;-)

Introvert said...

We did exactly that and moved here. My brother would do the same if the housing is cheaper. It doesn't matter raining or not, we can do long walks outside most days here, try to do that for one hour in Ottawa under -10C, and you will know what I meant ... the list goes on ...

You tell 'em, Al! It's all true.

Jason said...

in my field, private sector is double public if you are bright.

Key words being 'if you are bright'. Or if you work very hard. Or if you are outstanding in any positive manner. If you are average or mediocre in the privsec you are more likely to get the same or less as your public counterpart. On the flipside, in the public sector doing a job to the level that would swiftly get yourself replaced elsewhere still nets 100% of your wage and pension. I'm not suggesting anyone on this board surfs my taxdollars like that, but we all know it is rife in the system. And an imbalance that leans toward government employees is growing yearly. Especially when we talk pensions.

But... that has little to do with RE i suppose.

Can anyone tell me the state of suite status in Saanich? Say my dog poops on the neighbors lawn, can she avenge herself by putting a stop my rental income with a simple phone call? Apologies if this has been covered ad nauseum previously.

a simple man said...

Al - I agree completely - we moved here for the same reason.

Jason - also agree - in the private sector you have to be motivated and work hard or you can very easily make less then public, which is why I put in the, if you are bright. If you are lazy you can't beat public.

Just Jack said...

Why are there not more, I mean a LOT MORE people living in Victoria?

Victoria is the 15th largest city by population in Canada. With our weather, why are we not at least in the top ten? In fact Oak Bay, Sidney and Brentwood Bay have close to zero growth in population.

Things that make you go hmmmmm.

CanSpeccy said...

"In fact Oak Bay, Sidney and Brentwood Bay have close to zero growth in population."

you can only get so many fifty foot lots in a defined space. Oak Bay is full, unless they rezone for higher density.

As I've advocated before, they should rezone the east side of Beach Drive through the Uplands for condominiums with a public boardwalk along the waterfront. You could house another five or ten thousand there.

Intensified development on Oak Bay Avenue and the adjacent streets would accommodate another ten thousand.

Thing is though what would the extra people do? We sure don't want more government or university.

a simple man said...

One thing I have to say about moving here is that so many of my friends/colleagues from out east talked of moving out here but would take one look at prices and say forget it.

It is one thing to say you would like to do something, another to actually do it.

Introvert said...

Why are there not more, I mean a LOT MORE people living in Victoria? ... Things that make you go hmmmmm.

Hmmmm. Well, here are some reasons:

-the ALR
-the Regional Growth Strategy, which promotes urban containment zones and densification instead of sprawl (contrast this to, say, Calgary, where the city annexes nearby hamlets and towns as it continually builds outward with zero emphasis on densification)
-lack of land (it's hard to build houses in Haro Strait and Juan de Fuca Strait)
-a disproportionately high seniors population, who, as we know, don't generally vote for "change"

Just some ideas off the top of my head.

Al said...

"Why are there not more, I mean a LOT MORE people living in Victoria?"

Job (not as much), land (very limited), housing price (too high), ...

Paula said...

“in the private sector you have to be motivated and work hard or you can very easily make less then public”

That’s funny – I know a Victoria consultant that finagled government contracts using that same argument. eg., he made $10k for a small one-page diagram for the BC government, but he “worked really hard” trying to get that contract. On the other hand, private sector engineers haven’t gotten a lot of raises this year because of the lousy economy, not because they’re too stupid or lazy. If that were true they’d just be shown the door.

Which gets back to Just Jack's question about why more people aren't here - one reason may be that the Victoria economy is so driven by the government (and all supporting trades/construction jobs), which means we're missing the middle generation of 25-45 year olds working in the private sector.

MD80 said...

"private sector engineers haven’t gotten a lot of raises this year"

That's funny - healthcare employees (which include engineers among other professionals!) haven't had a raise in a few years. Must be nice to be in the private sector and expect a lot of raises per year.

Private sector almost always make more. Pharmacists are a great example of that. Public sector may have more benefits and you can't buy houses with that!

a simple man said...

Hi Paula;

I agree that there have not been a lot of raises for anyone for the past few years - my rate has practically stayed steady for the past 5 for certain.

Bottom line for everyone - things are getting pricier and wages are not keeping up - private or public.

Which begs the question - when will the bubble pop?

Paula said...

"Must be nice to be in the private sector and expect a lot of raises per year."

Actually, the exact words were actually "private sector engineers haven’t gotten a lot of raises this year"

... meaning a lot of engineers haven't gotten raises this year.

Instead of twisting words, let's look the independent HR studies show that (over the last 10 years) govt workers' salaries have increased more than private sector equivalents, and that you don't have to be "stupid or lazy" not to get a raise - whether you're a private or public employee.

Paula said...

A simple man,

Completely agree ... things are getting worse for everybody, and it just makes you wonder when the decline in our standard of living will start, or if it's started already. How high will the government raise taxes to cover all their debt and CMHC guarantees. Even the low interest rates are a way for the government to ensure low payments on their debts, but how long can that really last.

a simple man said...

Paula - please let me apologize if I led anyone to believe that I think all public sector workers are lazy or not intelligent - that is far from the truth as I know many, many talented people who work for the public sector.

But if you are lazy in the private sector, or not that bright, you won't make more than in public.

Just Jack said...

The best solution is just to move the government offices out of downtown Victoria.

30 years ago, people could live and work in their city. Now with high prices, people are forced to commute. Its time to de-centralize the government and move a lot of the offices to where the people are living.

Its a lot cheaper for the government and the taxpayer to lease new office space in Langford and Colwood than build overpasses, bridges and new roads.

Government employees should stand up and say NO to commuting and YES to offices in the communities that they live in.

Leo S said...

Definitely the growth rate for salaries and benefits have been higher in public sector than private sector. There's several studies to that effect as Paula points out.

However I think there's also a good chance this is coming to an end. Pressure to implement austerity measures are increasing and unions are not getting their way more often. Pensions and benefits have already been reduced in the provincial government and will surely be reduced further.

Obviously in a government town these developments will serve as additional headwinds (Introvert: ie downward pressure) to things like real estate prices.

As for the effect on our quality of life, we already know that the quality of life that used to be attainable on a single income (house/dog/kids/hockey) now requires a combination of dual income and record debt for the average family. So it has already had an impact, but we have stretched ourselves to compensate.

Jason said...

I propose a move of all government offices to Vanderhoof. Essentially no commute and a very practical place to administrate all four corners of the province from. Benefits to the taxpayer would be immediate and last until such time as they built a $21B sports multiplex + monorail or bid for the olymics.

Marko said...

The one thing I found frustrating working at VIHA in a union is that competent, intelligent, hardworking co-workers made the exact $30 some dollars per hour as the incompetent, unintelligent, lazy co-workers.

The other problem was promotion. When I applied for the position of manager for my department I did not get an interview nor did a few other younger but very competent people. I thought it was a little funny the director signed my masters of health admin scholarship two years in a row and then I didn't even get an interview. They ended up hiring a woman in her mid 50's with a masters of social work to lead a respiratory therapy department (very technical, ventilators, etc.). I am sure she is great with experience but it really turned me off ever working in the public sector.

If I wasn't interested in real estate I would have packed my bags and moved to Ontario where I had two job offers in private health sector both starting at over 80k/year.

I can see why younger professionals would want to leave Victoria. You have managers at VIHA that have been there for 30 years. Very low turn over means not many opportunities for others.

Leo S said...

The one thing I found frustrating working at VIHA in a union is that competent, intelligent, hardworking co-workers made the exact $30 some dollars per hour as the incompetent, unintelligent, lazy co-workers.

Public sector unions, the great equalizer. It works both ways. The difference is that workers with the right initiative will move upwards in the ranks.

The other problem was promotion. When I applied for the position of manager for my department I did not get an interview nor did a few other younger but very competent people.

What makes you think those younger people were qualified to be the manager?
Technical skills don't translate to management competence. Same in my field (engineering), the good engineers aren't necessarily good engineering managers.

I am sure she is great with experience but it really turned me off ever working in the public sector.

So you're sure she has lots more experience managing, and thus she was hired as the manager instead of some people that have no management experience? Sounds like the process works just fine.

patriotz said...

"Its a lot cheaper for the government and the taxpayer to lease new office space in Langford and Colwood than build overpasses, bridges and new roads."

Problem is with 2 working spouses being the norm decentralizing employment doesn't reduce the amount of commuting because the spouses are likely to be working in different districts.

That's in a city the size of Victoria, million plus cities are another story as the job centres can be made much bigger.

Just Jack said...

At the beginning that may be true. But as the government employees switch ministries to take advantage of living and working in their communities then commuter traffic will reduce. Some employees may be have to stay with a specific ministry, but most of the support staff are easily transferable from one ministry to another.

Victoria is an odd duck. The traffic grid lock that occurs is ludicrous for a town of its small size. And that's because we try to channel everyone down to the far extreme point of an island in the morning and then reverse that flow in the afternoon.

DavidL said...

Who would have thought that there would be so much discussion about private sector versus public sector jobs in a real estate blog?!

I remember back in the 1980's when my father (who worked in the public service for 30 years) said that when the economy is booming, the private sector is much more attractive (in terms of remuneration, job prospects, etc.) but when the economy takes a downturn, working for the public service was more preferable (security, benefits, etc.)

Remember, just a few years ago - many private corporations were paying their workers stock options for bonuses, offering "finder fees" for valuable new employees, paying gym memberships, installing onsite cafeterias and recreation areas, etc.

I suspect that all this discussion reflects the general sentiment about where the economy is going ...

Leo S said...

Who would have thought that there would be so much discussion about private sector versus public sector jobs in a real estate blog?!

My PCS is deader than Oak bay after 6. Nothing else to talk about! :)

a simple man said...

Leo - I would argue that generalization of Oak Bay, but I am too tired and getting ready for bed.

Just Jack said...

Me too, I think I'll just watch some Coronation Street on the tube, make myself up a chip buddy and put a glass of beer in the microwave.

Dave said...

And my wife's job has no equivalent in the private sector.

This doesn't help the government waste stereotype :)

(Yes I'm aware that her job is most likely very important, it just struck me as funny when I read this with a cynical mindset)

Dave3

Devore said...

If Victoria is so desirable, why ARE there not more businesses and people here? Do CEOs, VPs, bankers, entrepreneurs, millionaires and other "captains of industry" prefer the climate of Toronto? Where are all the corporate HQ (or even regional)? Maybe when it comes down to it, no one gives a shit whether it snows or rains on any given day, because you spend 90% of your life indoors.

Al said...

"If Victoria is so desirable, why ARE there not more businesses and people here?"

They (CEOs, VPs, ...) are, but they are here in their vacation home to relax and enjoy life. Remember the story of Westjet CEO's garbage/recycle were taken from his house in Uplands?

For us, Victoria is desirable for its outdoor life and enjoyment, nice size but small town feel, especially because it is not a business center like Toronto, nor a big and busy city like Vancouver.

Marko said...

"Public sector unions, the great equalizer. It works both ways. The difference is that workers with the right initiative will move upwards in the ranks."

Or seniority...

"What makes you think those younger people were qualified to be the manager? Technical skills don't translate to management competence. Same in my field (engineering), the good engineers aren't necessarily good engineering managers."

I 100% agree with this - lots of examples of this in the private sector. I never said younger people were MORE qualified; however, there were plenty of younger qualified applicants from within the department that the director didn't even take 10 minutes to interview. Fair or not this results in bright people leaving the organization and going into the private sector.

I also don't think just because someone has experience that it makes them a good manager.

Marko said...

Certainly no flex days in the private sector :)

At the end of the day while unions have some flaws they are what make Canada one of the better countries in the world to live in.

Renter said...

Marko, the private sector doesn't hand out raises and promotions just for the hell of it. What we're seeing in the Fortune 500 tech company that I work for has been facing attrition, lay-offs, and more attrition since 2008. Fewer employees are doing the work of more people, there is no such thing as over-time pay, and managers are typically hired from outside the company as opposed to promoted from within the company. The want MBAs to be managers, not engineers. Engineers can get promotions up a technical track, but not a managerial track (usually). Employees are feeling lucky to have a job - they're not knocking on the director's door to demand a raise.

Animal Spirit said...

Lot value is dropping like a stone.

Stay tuned to Househuntvictoria and you'll find out why. (at least once I write some things up and send some graphs along)

Next, right after express our accumulated internal anger at the target of the day.

(btw the head of the public service is an engineer, and if you think this discussion is bad, take a look at Vancouvercondo.info the last few days)

Leo S said...

Lot value is dropping like a stone.

Eh? All we've been hearing here is the opposite. I'm interested to see your stats on this.

My 30 sale median sale price/assessed is at an all time low (92%) for the lower end of the market. I was expecting a bump in prices in Nov/Dec but it hasn't appeared yet. Despite the falling inventory there is still enough out there. More and more more sellers are caving and taking lower offers.

patriotz said...

"If Victoria is so desirable, why ARE there not more businesses and people here?"

Because a small expensive city on an island is about the most uncompetitive location any business could choose?

Victoria is the largest insular city in North America. The real question is how it got as big as it is, and we know the answer.

Animal Spirit said...

Leo - let's just say there is a difference between lot value for tear down and then new construction, and fundamental lot value to which house value gets added to give total value.

Sure, there are only a few pure tear downs, however it is with the houses just above tear down state where prices are dropping quickly.

a simple man said...

Finally some truth from behind the silent curtain of the construction industry:

Construction industry hits deep slump.

a simple man said...

2056 Hampshire Rd is my new benchmark house - this is one I would have bought, should it pass inspection. Much, much nicer than my previous goalpost houses that sold for $800K.

The open house was cancelled today, so it may already have an offer - interesting to see what it will be.

My take, though: for the house I want to buy, the market has dropped at least $100K from last year. We are on our way.

Zidane said...

Any comments on 299757 and 301939? They are side by side on Summit Ave. Similar prices. One has been for sale for a while, bigger lot but needs total reno. The other seems to have more upgrades?

Marko said...

Monday, November 28, 2011 8:00am

MTD

November

2011 2010

Net Unconditional Sales:

419 479

New Listings:

756 722

Active Listings:

4,202 3,723

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

a simple man said...

Again, I wonder aloud, who is buying now? Are they not paying attention?

These numbers are historically very low. but they need to go lower before real pressure hits the market.

The DP said...
This comment has been removed by the author.
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