Monday, December 12, 2011

Monday market update: pre-holiday doldrums

MLS numbers are courtesy of the VREB via Marko Juras. Numbers are for the entire board reporting area, including Gulf Islands, Sooke and Shawnigan Lake.

December 2011 (month to date)
Net Unconditional Sales: 146
New listings: 222
Active listings: 3,879
Sales to new listings ratio: 65%

December 2010
Net Unconditional Sales: 349
New listings: 522
Active listings: 3,252
Sales to new listings ratio: 66%
Sales to active listings ratio: 10.7% or 9.3 MOI.

We're averaging 13 sales per day. That's about a 14% drop from a rough three month daily average. Nothing too shocking considering we're at the pointy end of the annual sales slowdown. But listings are also up over 16% from this time last year--in other words, a seller's market this aint!

73 comments:

a simple man said...

I find it unreal how flat this market has been for two years.

Oh well, time to put my head down and work to build a larger downpayment for when prices do get more rationale.

Just Jack said...

Even a flat market is hurting people.

Those that overextended themselves to buy a home and have had to use their credit cards and lines of credit to pay living costs have ever increasing debt loads at high interest rates.

In years past, they could just re-finance the home and roll that debt into a mortgage - sometimes at a lower interest rate.


$30,000 in credit card debt will cripple a lot of people. For most wage earners it's almost impossible to pay that debt off given the high interest rates on credit cards.

And if you have tapped out on your home equity too, you're heading for bankruptcy. About 2 or 3 years into a flat market, people with this kind of debt - just stop making payments.

The weight of all that debt will bring the real estate market down. I'm seeing it now with the foreclosures. When people were flush with credit, homes under foreclosure were few and these homes sold at close to full market value.

Today, the foreclosures sell at deep discounts because there are so few bidders that can come up with money, given the restrictions on offers made to the court. Ironically, if the property is insured by CMHC and the sellers have declared bankruptcy, the Court readily lets the home go very cheap. The Court has more compassion for people than it has for insurance companies.

The market in most of the core municipalities is still balanced. Even with 6 months of inventory, there are extremely few to none, properties that sell at significant discounts. Those that do sell at deep discounts are the odd, the old and the ugly.

Compare that with Langford and even more so with Sooke. Newer homes are under foreclosure and deep discounts are relatively easier to make.

So, low ball offers are most likely to have a better chance of success if your buying outside of the ten mile circle of downtown Victoria, or the property is odd, old or ugly.

Maybe Marko can talk about the pitfalls of buying a foreclosure?

JustWatching said...

There has been a lot of talk on this blog about buying in Oak Bay. Some posters want to buy because it is the place to be.

You just need the encouragement of a good realtor to make it happen

Youtube - Suzanne will help you

Marko said...

"Today, the foreclosures sell at deep discounts because there are so few bidders that can come up with money, given the restrictions on offers made to the court."

I haven't seen many foreclosures sell at discounts to be honest. The one foreclosure I was involved in went over market value in my opinion. Seven parties showed up on the court date.

There is a lot of people in Victoria with a lot of money...your comment about few bidders being able to come up with the money is way off in my opinion. Over 20% of transactions are all cash.

Introvert said...

Walking and driving on Sinclair Road, I've noticed a new project. I believe it's located between Haro and Pitcombe. It seems like one or possibly a few houses were torn down to make way for what seems like a new cul-de-sac. The sign advertises it as "Cadboro Heights."

Does anyone know anything about this development? What are your impressions of it?

Just Jack said...

The recent sale on Cairndale is a good one or the water front lot on Kerwood of deep discounts and few buyers.

As for 20 percent cash sales. That's low in comparison to the last decade. That 20 percent accounts for a lot of the move up and down size crowd as well as family gifts, etc. It's more startling to say that 80 percent of people require financing today, given all the wealth that has been created in real estate over the last dozen years.

I'm sure that recent sale of 6 million in Victoria could likely be a "cash" sale too. But I bet a month later, that home will have an equity line of credit placed on it pulling out a lot of that "cash".

As for people buying a second home for an investment. They may buy them without subject to financing - But, most (and they all should be) financed to at least 80% and likely 100% for the tax write-off.

If you have 50% of the price of the home and you have been pre-approved from the bank, you don't need to put a subject to financing clause in the agreement. The bank is going to be lending on the assessed value, so the home is not even going to be appraised. That's an all cash offer to.

So, one in five buyers purchasing with "cash" that's low.

What I would like to see, is the guy who buys a house for $650,000 and opens up a briefcase with the money right there. Now that's cash, baby. Everything else is financed.

a simple man said...

Introvert - I have watched that project over the past year on my trips up to UVic. if I were a professor at UVic, I would be all over that development. I haven't seen any plans or anything, but the location is ideal, along with a new home.

happy renter said...

Question from a friend who just got out of the market:

How do landlords react to renters who previously owned a house/condo and therefore don't have recent references as tenants? Would landlords be leery of renting to someone who had previously owned rather than rented? Would the assumption be that that person had run into financial trouble, or would it seem relatively "normal" to go from owning back to renting?

Renter said...

Happy renter: When we returned to renting 2 years ago, we didn't have any trouble at all with not having references. We explained that we had sold our condo and were looking to rent for a while - "try out the area" was our explanation. We then requested references from them, saying that when we were younger we had issues with inexperienced and unprofessional landlords (one of the reasons we had bought the condo, in fact) and did not wish to repeat the experience. I think we were all (us and landlady) satisfied with the approach and results.

Caveat: We are in our 40s and "look respectable" as in, we're white, solidly middle class, have excellent jobs, and an excellent credit history. Folks who don't have those same things going for them might have more trouble. Back when I was a poor student, I can recall having to beg prospective landlords to consider us because even with good references we just didn't look as good on paper. Apparently just saying "student" was enough to have people hang up on you in the early 1990s.

Leo S said...

Over 20% of transactions are all cash

Funny you see it as high, I'm actually very surprised it is that low. All we've been told is that Victoria is a retirement Mecca. Rich retirerees are buying from all over the country. And yet only 20% are cash deals?

That is precisely the same percentage as the test of the country on average (read CAAMP's fall report)

Marko said...

There is a bit of a difference between paying cash for a house here and other parts of the country.

Leo S said...

Yeah but it has zero effect on the housing market. Is there lots of money in Victoria? No. Not measured against the housing market.

In terms of real estate buying power, there is no more money in Victoria than in Podunk, Saskatchewan.

relativelyspeakin said...

@Happy Renter

I just sold and started renting in July. I had no problems when I told people that I had owned for the past 7 years and had no references. I even had landlords calling me back asking if I was sure I didn't want their unit when I had already passed on it.

For the place I did pick, all I gave them was my employer as a reference to confirm my employment and income.

My landlord told me that she liked that I had been a homeowner because I would have more respect for the property knowing what it costs maintain and replace things when they are damaged. It's an old house and she wanted someone who would treat it well and let her know right away if something needed to be repaired rather than let her find out a year or two later when the tenant moved out.

She got the sense I would treat it as if it was my own, not just as some random place I was renting, which I guess is a problem with some renters. They can have an attitude of 'I don't own it, not my problem'. Not that I have to fix or pay for anything, but I do take responsibility to just let her know if something needs repair.

Al said...

Introvert,
The development off sinclair road is on our way (walking/biking) to the beach, had a "coming soon" sign there for probably more than 3 years, the new subdivision was approved by Saanich earlier this year. It has about 10 (or 12?) lots, size from 7xxx sqft to 9xxx sqft. Two of the biggest lots on the higher side have existing old and big houses with ocean view and they will stay (probably not for sale). All other old houses/sheds have been torn down. The lots are a bit small, but I expect all the new houses there would be individually designed and built, most with some ocean view and high price/cost tag. We really like the neighborhood, lots of character. I know it is Saanich, but is probably more interesting than some of the plain neighborhoods in Oak Bay ;-).

happy renter,
We are helping friends managing their rental house, and are members of BC Landlord Association (ROMS). We do ask for recent landlord reference if the tenant has one, but that is the weakest reference in our consideration, comparing to credit checking, employer and work references. Since the most recent landlord might not tell you the truth if they have trouble with the tenant and wants to get rid of him/her ;-), and yes, we do like renters who have been home onwers before as they understand the importance of house maintenance.

caveat emptor said...

"Even a flat market is hurting people."

Well the sharply rising market up to 2008 "hurt" a lot of people by pricing them out of the market.

Look S of the border to see the world of hurt caused by a true nationwide crash in real estate prices.

So a flat market(i.e slowly deflating in real inflation adjusted terms)is probably the least painful option even if it's not what many on this board are cheering for

patriotz said...

"So a flat market(i.e slowly deflating in real inflation adjusted terms)is probably the least painful option"

It's not really, because the more slowly prices fall, the more people will buy at inflated prices.

That's where the economic damage really comes from - people taking on massive amounts of debt to buy overpriced properties. That debt has to be serviced no matter which way prices go and how fast.

What would be best for BC is a quick fall like in the 1980's so the province can start attracting real businesses again.

Falling prices just take away the false illusion of prosperity people have because they think they can sell their house for an inflated price. But households only sell houses to each other, so there is no net gain to all households in higher prices.

mrmike said...

Was the 80's bubble global like it is now?

omc said...

That development off Sinclair backs directly onto Frank Hobbs elememtary school at the back. If you are curious you can see far more form that vantage point. It will be interesting to see how this one is recieved as it is a new subdivision in a prime location BUT it isn't Oak Bay.

I agree with Al, that that area is better than a good portion of Oak Bay, but it doesn't get really nice until you are about a block away from Finerty due to the noise; cars going up a steep hill are quite loud. Not many houses go on the market in this area compared to the constant buy/sell of Oak Bay, and they don't seem to get the same feeding frenzy responses either. Up until about 10 years ago this area was much more expensive than Estevan due to the nicer locations, far better houses on bigger lots. The housing stock is far more varied with houses ranging from turn of the century to present. Almost all seem to be family type houses from the 50s and up, mostly well maintained.

Lots of young professional families, just like estevan. It's hard to compare the prices between the 2 areas as I consider estevan's housing stock to be the worst in the area. If you were to look at 50s ranchers in good locations, 3 beds on one floor, in need of updating only and in good locations it would go just under$900k in estevan. In Cadboro Bay they seem to go in the $6-700k range.

Marko said...

I can't see these homes starting under 1.1 or 1.2 million.

omc said...

mrmike,

I don't know of any economists who compare the present to the 80s. In the 80s interest rates spiked at record highs to slow inflation. Nowadays we are looking at record low interest rates for an extended period of time. The more relevant comparison is the correction of the 90s, where prices sagged and then stayed the same for 7 years,until inflation caught up. Except for some areas of Oak Bay and Fernwood, this has already being happening since the 2007 peak. As LeoS has pointed out; there is no harm in not entering the market, but it might not make sense to sell and re-enter later. With the low interest rates 1/2 of your mortgage payment goes to principle. Add the property transfer tax, realtor fees and such and you would most likely lose if you tried this. This is for a house in a flat market, not a condo. Condos drop in a flat market, and I believe there is a glut of supply.

omc said...

I would agree with you Marko. I just wonder if there is a market for them in that range, in that location.

Marko said...

There is really good demand for new homes and the location is better than Gordon Head. I can see those homes going to a number of overseas buyers.

JustWatching said...

Marko said "I can see those homes going to a number of overseas buyers."

BC really needs to put restrictions on foreign ownership. Other provinces and countries are doing this.

This could be done by higher PTT or property taxes for foreigners. If these were doubled for foreigners it would have a big effect on non-resident ownership.

JustWatching said...

Looks like China's real estate bubble has popped....

Shanghai prices drop 40%

Average prices in the Shanghai area are down about 40% from their peak in mid-2009, to about $176,000 for a 1,000-square-foot home.

Sales have plummeted. In Beijing, nearly two years' worth of inventory is clogging the market, and more than 1,000 real estate agencies have closed this year. Developers who once pre-sold housing projects within hours are growing desperate.


I wonder if this will have an effect on the Vancouver market. If the bloom is off the rose in China will they continue to buy real estate overseas?

Craig said...

"There is really good demand for new homes "

This is what I don't get about Victoria. People want new homes but the regulations thwart them.

While there are some nice heritage homes most of the character homes are just awful. Do people really see 'character' in those sad, pebbledash bungalows, or is it a couple nitwits on the council planning committees?

Leo S said...

I wonder if this will have an effect on the Vancouver market. If the bloom is off the rose in China will they continue to buy real estate overseas?

Could argue that one both ways. Either people realize that housing is not always a safe investment and see the similarities to Vancouver, or they have one more reason not to invest in China and bring the money here instead.

omc said...

The China thing was bound to happen. The gov't stepped in to deal with rampant speculation. What this will do to the VAn market is unclear. One theory is that there will be less money to invest in foreign RE, the other is that more money will be chanelled to RE investments that they consider more secure. This would be VAN. The other thing to look at is that these "RE investments" are basically economic escape pods.

happy renter said...

Thanks for all the responses re: former owners renting. I'll pass your thoughts on to my friend. He seemed to be particularly worried that a landlord would assume that he'd had to give up owning because he'd been irresponsible with his money or something, but it certainly doesn't sound that's typically the case. If I was a landlord I think I'd rather rent to a former owner too. It makes perfect sense that those who have owned might pay more attention to how the house/condo that they're now renting is cared for.

happy renter said...

From today's Globe and Mail: "Stagnant incomes push debt burden higher"

http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/stagnant-incomes-push-debt-burden-higher/article2269210/

JustWatching said...

Oak Bay attracts a lot of buyer interest but so does Fairfield. Here is a Fairfield listing for 649K that has been reduced from 675K but still has not sold. Why not?

1842 Chandler

1842 Chandler Photos

If you are keen on this one call Marko and save yourself some money with his cashback deal.

Introvert said...

A simple man, Al, omc, Marko: thanks for your thoughts on Cadboro Heights. Does anyone know if the lots are for sale yet? I wonder how expensive they’d be. The location certainly has its pros and cons.

On another matter, has anyone else noticed that this blog’s comments are generally very Oak Bay-centric, for whatever reason? Honourable mention goes to Fairfield and Fernwood. Any ideas why this is the case? Why is Oak Bay the place to be—or at least the place to talk about? To me, Oak Bay seems on par with Cadboro Bay in many respects. What about Gordon Head, Cordova Bay, Broadmead, places like that? No interest? No good? Why would people even want to live there? (Just playing devil’s advocate.) What do you think?

a simple man said...

omc - I agree that the value of Estevan and Henderson are grossly overvalued for what you are getting. I love the Estevan area for the natural surroundings, but I hate the housing stock as the houses are often very poor for a premium price-tag.

I am hoping that changes. I cannot understand paying three-quarters of a million dollars for a run-down house that you will need substantial renovations to enjoy.

Agree that Caddy Bay has generally nicer homes for less cash, which is ironic since in most places being close to the University you pay a premium.

and Introvert - I write about Oak Bay because this is where we live and our kids attend school here, so I feel motivated to not move them again. When we were moving from afar we short-listed Cordova Bay, Fairfield, Oak Bay and Caddy Bay (village communities).

Oak Bay won out. Cordova Bay we felt we would be driving all the time and the "village" was laughable. Fairfield was nice but we felt it was too close to the "nightlife" the frequents Beacon Hill Park and as nice as Cooke St village is now, we just felt it was for young adults, not kids - I have since got to know it much better and I really like it, although it also has its share or poor housing stock. Caddy Bay was a close consideration - I think Willows Beach and Uplands Park swayed us in the direction of Oak Bay. I really don't care for South Oak Bay that much because of all the older character houses, but some love it for that.

omc said...

introvert,

You must be from around here if you consider caddy bay equal to oak bay. Many of my colleagues from out of town were told that the only place they would want to live is oak bay. One asked me if caddy bay was out on the peninsula.

I see nothing wrong with the neighborhoods you have listed. Gordon head, caddy bay, cordova bay and even broadmead have better schools and access than oak bay. Oak Bay is way over rated right now. I am noticing things are starting to sell fast in caddy bay now and flippers are starting to show up, so maybe the pendulum will swing some where else for a while.

I would rather live in a gordon head box in a decent neighborhood than a 30/40s war shack any day.

Fairfield is nice, but less ideal for families due to the suites. Lots of traffic noise, lack of parking and a transient feel to the neighborhood have caused 2 couples I know to move.

Alexandrahere said...

A condo at "The Balance" a LEEDS building at #301-373 Tyee Rd just sold for $392K. 2011 Assessment is 446K and 2010 Assessment was 500K. Nicely done, nicely finished with OK views. Does anyone know what the original sales prices as well as recent sales for one of this size went for? Thanks.

Marko said...

The Cadboro Heights Lots are now on sale. $540,000 to $599,00 + HST. Approximately 8000 sq/ft.

Fiduciary said...

Alexandrahere, that kind of condo is what I'm looking for - to rent until the price comes down to a reasonable level. Unfortunately most of the nice, new condos are made under 800 sq. ft. because that's how the developers make the most money, but that's not enough livable space for me. I'm also not crazy about Vic West, but that's mostly because of factors (people) beyond my control.

Hopefully the condo segment will drop first if a crash comes, then I can hop in.

caveat emptor said...

"On another matter, has anyone else noticed that this blog’s comments are generally very Oak Bay-centric"

Maybe that is why everyone thinks Victoria real estate is so over-priced. They all want to own in Oak Bay? :-)

We looked in Oak Bay when we were moving here but in the end found better value in Fairfield, plus shorter bike commutes to work. Neighbourhood seems very family friendly to me. 5 out of 9 of our close neighbours have kids (under 15). (If you count adult children still living at home then that number goes up to 7 out of 9).

Paula said...

"Here is a Fairfield listing for 649K that has been reduced from 675K but still has not sold. Why not?"

Perhaps it's because the house is straight across from a school and the extra traffic and school noise would bother a lot of buyers.

caveat emptor said...

"What would be best for BC is a quick fall like in the 1980's"

Looking at what has happened in the states it isn't obvious that a quick fall in prices would be best for the average person.

The nationwide bust in housing in the US has contributed to the biggest employment recession in the US since the Great Depression
http://www.crgraphs.com/2011/10/employment-graphs.html . The housing bust in the US has hurt many people through job losses, including lots of people that never bought overpriced houses in the first place.

If housing falls hard in Canada, there is no reason to think that falls in prices will only happen in the bubbly markets (Vancouver, Victoria, etc.) Most likely house prices will fall nationwide like they did in the US.

If or when that happens it will be a painful process just like in the US. And it will hurt lots of people, not just those that "bought high".

Dave said...
This comment has been removed by the author.
patriotz said...

"The housing bust in the US has hurt many people through job losses, including lots of people that never bought overpriced houses in the first place."

That's because the whole US economy had become based on selling overpriced RE to people using borrowed money.

Sound familiar?

The solution is to get the alcoholic off the booze, not to keep giving him more drinks. Putting off the return to normalcy just makes it more difficult.

patriotz said...

"Was the 80's bubble global like it is now?"

No, the current global housing bubble is unprecedented. In fact prior to the last decade there had never been a national housing bubble in Canada or the US. Regional markets were largely uncorrelated and prices could be rising in one market while they were falling in another.

a simple man said...

patriotz - speaking of getting off the booze...

from the TC today:

OTTAWA — Household debt as a proportion of annual disposable income in Canada reached a record 152.98 per cent in this year's third quarter, Statistics Canada said Tuesday.

That was up from 150.57 per cent in the second quarter of 2011 as personal debt — including credit-card balances and mortgages — rose without any corresponding increasing in income.

The data also showed that the per-capita net worth of Canadians fell to $180,100 in the third quarter, from $184,700 in the second quarter, as stock markets took a dive.

That was the biggest quarterly drop in per-capita net worth since the fourth quarter of 2008, when the financial crisis devastated global stock markets.

Statistics Canada noted that the Toronto Stock Exchange's S&P/TSX composite index fell 12 per cent in the quarter, which is also the biggest decline since late 2008.



Read more: http://www.canada.com/business/Canadian+household+debt+hits+record+high/5851720/story.html#ixzz1gSemJrpA

Leo S said...

Sale price/assessment for the higher end is really dropping... Down to 98%. I guess just the crap is left now.

Leo S said...

Are sellers more likely to accept lower offers in this weak market?

For SFHs under $550k, no.
For SFHs $550k to $900k, maybe.. Down 1.5% in a year.

For the most part, sellers are dropping their prices instead of accepting lowballs, although it seems for the higher end there might be a bit more room to negotiate than there used to be.

Animal Spirit said...

The TC needs to find someone who understands math to write headlines for business stories. Sorry Carla (I am pretty sure you read this blog), but a rise in rental vacancy rate from 1.5% to 2.1% over a year is anything but an 'easing of rates'.

Do the math please: (2.1-1.5)/1.5*100=?

Warning - TC link to rental vacancy rate story

Yes, that is a whopping 40% rise in a year. Easing, my ass.

Just Jack said...

2.1 percent vacancy rate for Victoria is very high. Up until 2007, purpose built apartments had a vacancy rate at 0.5%. This "old" stock rental market represents low income workers and new single people to the city.

This is another pre-cursor showing the weakness of our real estate market. Soon, we'll see stats showing that more people are leaving Victoria than moving here. And that would blow a hole through the argument that everyone wants to live here.

a simple man said...

Funny - I was just on the phone with a researcher from the prairies and she said "Victoria - a very nice place, but I could never live there."

It is true that not everyone dreams of an Oak Bay existence.

JustWatching said...

The vacancy rate calculated by CMHC is only for multi-unit buildings. Condo, house/townhouse and basement suite rentals are not included. You only have to go to Craigslist or any one of the property management sites to see that these are a large segment of the rental pool.

I found this part of the TC article revealing...

Al Kemp, CEO of the Rental Owners and Managers Society of B.C., said Victoria's vacancy rate is "significantly understated." Following conversations with owners and managers of rental properties, he estimates the figure is closer to four or five per cent across the entire rental market.

Kemp questions the accuracy of information going to the CMHC, saying he thinks resident managers in apartment buildings may be under reporting vacancy rates. Amounts of rent charged may also be somewhat understated, but not as much as vacancy rates, he said.

happy renter said...

I've been helping a friend (the same one who asked about the stigma of owning after becoming a renter) to find a new place since he just sold his 2 bedroom condo. He wants to rent out something pretty similar to what he just sold. Not necessarily in the same building, but something that's also downtown and relatively new. He's having a really hard time coming up with something and so am I. There's a flood of new condos for rent (mostly in the 834, it seems), but they are outrageously priced. It's actually kind of shocking how few good newish downtown condo rentals there are out there right now. There's lots of stuff in older buildings. But maybe people just don't tend to want to move around the holidays?

Fiduciary said...

Happy renter, I've seen the same thing - if you're going to rent downtown, you're going to pay a big premium, and probably get a tiny box. It still baffles me how many people seem content living in 600 sq.ft. or less.

a simple man said...

cbc.ca:

TD Bank has lowered its outlook for the Canadian economy next year to 1.7 per cent growth, followed by 2.2 per cent in 2013.

The bank’s latest forecast, issued Wednesday, knocked its 2012 prediction down by 0.2 percentage points from its last look ahead in September, and the following year’s by 0.4 points.

TD blamed Europe for the direr outlook.

Unemployment rates in Canada
“An escalation of the European financial crisis and a deepening recession in the region will exert a significant drag on the global economy,” the bank said.

“Canada will be negatively impacted through weaker commodity prices, confidence and export growth."

TD predicted the unemployment rate — now 7.4 per cent — will increase, to a range of between 7.5 and eight per cent.

Although TD expects Canadian economic activity will improve in late 2012 and into 2013, “high household and government debt, rising interest rates and slowing housing activity will limit the speed of Canadian real GDP growth.”

happy renter said...

Fiduciary, the best "deal" I've heard of recently was a 1000sqft newish downtown condo for $1575. That certainly beats the $1350-$1400 for 600sqft (with parking) that I've been seeing a lot of, but it still sounds a little insane.

Fiduciary said...

I heard ya. I fit the typical profile for someone that would live downtown (young professional, works downtown, no kids), but a) there's no value to what you get downtown, and b) I just don't want to be there. I like the little hubs you get in the various neighborhoods.

JustWatching said...

If you are looking for a rental this mapping site will help. Scans all the usual sites and maps them for you. You can filter by price and #bedrooms...

Victoria padmapper


This is a great site and was posted here awhile ago by someone else. Thought it deserved a repost.

Marko said...

"There's a flood of new condos for rent (mostly in the 834, it seems), but they are outrageously priced."

I moved into my unit at the 834 three weeks ago and have been surprised at what has rented in the building.

A 7th floor 725 sq/ft 2 bed, 1 bath with parking rented for $1,600.

Someone I know also rented a $209,900 unit (pre-sale price) for $1,175.

Mortgage, property taxes, and strata fees combined I am under $900 (I put down 20%).

"It still baffles me how many people seem content living in 600 sq.ft. or less."

My unit is 530 sq/ft and it has everything I need.

Fiduciary said...

Marko, that's great for you - I don't mean to judge. It's good that people are content with that little space, it's just not for me. Logically, I know that people make it work under 600 sq.ft., I just can't see myself doing it.

Chickinvic said...

I live in 1100sf (well, there's 3 of us). I couldn't stand living in such a small space as most of the newer condos. I think it would get old REALLY quickly.

happy renter said...

Now this is crazy:
http://victoria.en.craigslist.ca/apa/2753028198.html

$1395 for 573sqft in the 834 and no parking! But I guess people are renting these places? There is a nice view.

happy renter said...

"A 7th floor 725 sq/ft 2 bed, 1 bath with parking rented for $1,600."

That seems to be about the standard price for a newish 2 bedroom downtown with parking. But 725sqft strike me as an exceptionally small 2 bedroom. Maybe I'm wrong though? Is that square footage standard these days?

Marko said...

"But 725sqft strike me as an exceptionally small 2 bedroom. Maybe I'm wrong though? Is that square footage standard these days?"

Depends on how much you want to spend. Take a look at the layouts for the Bayview Promontory which is currently in pre-sales. You have 2 bedrooms from 723 sq/ft to 1,160 sq/ft...or from around 345k to 550k+

http://www.bosaproperties.com/promontory/interiors_floorplans.php

Leo S said...

Really don't see the point in these microboxes. Yes 500sqft is fine when you're on your own, but as soon as you have someone move in it gets tight. Condo market is flat at best. If you're going to be moving up in 5 years (many friends have been moving up much faster than that) you will be losing money.

Some other friends picked up a 1100+ sqft 2br condo in a nice 90s building near Hillside mall for $300k. Way better value than some new place for more money and just over half the space.

JustWatching said...

Another "deal" in Fairfield. Upgraded and close to schools. On the border of Oak Bay.

435 Richmond

Better act fast.....

Just Jack said...

Its all about sex.

Young men are willing to pay gobs of money for a one bedroom downtown condo because their chances of scoring are better than driving their date back to Sooke. (What you thought it was because they wanted to be near the museums?)

Single women are more frugal with the money they choose to spend on rent so they live farther out from the downtown core and buy better clothes. They don't have to rent downtown they just have to meet guys that rent downtown.

Of course you can't forget the Gay element in Victoria. This is a government town. So it would be ridiculous to be Gay and live in the suburbs. You would have to wear tacky shorts, grow a pot belly and get a wiggly looking tattoo with lots of swirls (what the hell are those things suppose to be anyway - Art?) to fit in with the straight guys.

So, you have to ask yourself - are you lucky guy or are you a GUD (Geographically UnDisirable)

$1600 a month for a one-bedroom doesn't seem to bad now.

And that's how these condos should be marketed instead of a sign that reads

"If you lived here - you'd be home by now"

it would be

"If you lived here - you'd be digging finger nails out of your back by now"

Fiduciary said...

I'm in a ~700 sq.ft. 2 bedroom right now, and I'd classify it as small. Granted it's a 2 bath so that uses some living space. I'd still classify 725 as small, but, as we know, the trend on new development is to go smaller.

happy renter said...

I've lived in a 600sqft condo with my spouse and it was fine for a couple of years. It's actually kind of nice to have everything arranged very efficiently so that it'll fit in there. But once we started to accumulate a bit more stuff (sports/camping gear), we started to lust after more space. And unless the market is really hot, there's no way to sell a condo 2 years after you bought it and not lose money on transaction fees, realtor fees, etc.. I would never recommend that anyone buy anything for the short-term anymore. If you're going to move out of your condo after a couple years, hold onto it and rent it out for many more to come.

happy renter said...

I'm starting to think that $1575 for 1000sqft of new condo downtown was a steal for the person I know who scooped it up a couple months ago... 1 bed + den, but very large.

Fiduciary said...

When you're dealing with a small space like that out-of-suite storage becomes important. We have none, and that's one of the reasons why we're feeling cramped. For us it's camping gear too, but also Christmas stuff (tree, decorations, wrapping paper). Those two things take up almost an entire closet for us, but it would be great to put them in a storage locker if we had one.

patriotz said...

"If you're going to move out of your condo after a couple years, hold onto it and rent it out for many more to come"

That doesn't make any sense. If the net rental yield on the market price of the old place is below borrowing costs on the new place, you're better off selling and using the money for a bigger DP on the new place.

Especially when interest rates are at historic lows, which means the risk of them going up is greatest.

Even if net rental yield were better (it sure isn't today), you'd be paying income tax on the net when you could get a tax free return on the capital in your principal residence.

Oh and did I mention you'd be making a big bet on RE going up continuously or at the very least not going down? Loads of people in the US tried your strategy - how did it work out?

If you're not planning on staying for the better part of a decade, you simply shouldn't buy.

happy renter said...

Good point, Patriotize. I got out of my condo entirely because I was worried about how long the market could stay stable.

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