November 2012 month to date
Net Unconditional Sales: 289 (210, 140, 40)
New Listings: 594 (451, 323, 116)
Active Listings: 4525 (4577, 4648, 4397)
Sales to new listings ratio: 49% (47%, 43%, 34%)
November 2011
Net Unconditional Sales: 482
New Listings: 847
Active Listings: 4329
Sales to new listings ratio: 57%
Sales to active listings ratio: 11% or 9 MOI
Not much to say about that. Sales are down significantly YoY, while listings are almost on pace. I'm thinking north of 11 MOI for the month.
The mortgage industry continues to hyperventilate about the rules and cry government interference in a market that only exists because of said interference. Luckily some cooler heads are out there, including CIBC's Benjamin Tal, and suprisingly, the head of Royal LePage, who said
The mortgage industry continues to hyperventilate about the rules and cry government interference in a market that only exists because of said interference. Luckily some cooler heads are out there, including CIBC's Benjamin Tal, and suprisingly, the head of Royal LePage, who said
“I’m being contrary again. I think the impact of mortgage regulation is being blamed far too often these days in what is clearly just a natural cyclical slowdown in the market driven by overpriced homes. We were due for a slowdown. The timing was unfortunate but it’s not a major event. I think chances of it (the regulations) being reversed are close to zero.”In other news, the Bank of England poached Mark Carney. I wonder what this means for the Bank of Canada's rate position..
213 comments:
«Oldest ‹Older 201 – 213 of 213Oh good grief. Even if vacancy rates rise if you have a good place at a good price you will be okay.
Not sure why people keep coming back to this "lots of people will be okay" argument. That means nothing. The people that are ok are completely irrelevant. Introvert will be ok, you will be ok, the majority of people in Phoenix were ok, and we would be ok too if we bought. The effect of that on the market? ZERO. The only people that matter are those that aren't ok.
If you are an owner you can be way more responsive to market conditions and renter desires than you can as a property management company.
In what way?
This was 7 years ago. I sold the condo in 2009 and am renting again, but I can't say we didn't have some trepidation about that given previous experience. But the value of the condo had increased so much that we just had to sell.
Interesting story. Can't say I would have gone back to renting after that experience! So far so good for us. After a few minor repairs that the landlord handled in the new place it seems they're relatively ok (renting from professionals seems to help).
Property managers manage many units at the same time and take about 10% of the rent. An owner manages their own property and stands to lose 100% of the rent. $200 loss compared to $2000 dollar loss is significant. Motivation to respond to market conditions is much greater imo for an owner.
If conditions declined and I had trouble renting I would immediately:
- lower the price slightly
- consider furnishing it and renting it that way
- pay for additional advertising on the uvic website
- upgrade the unit in some way
- take new photos
- repost on free online sites every day
- problem solve as to why it is not renting and take additional steps
I've rented close to forty times. I've rented to a friend twice and a friend of a friend once. I've rented to family once. I have had zero vacancy for month to month rentals or longer-term leases.
"The only people that matter are those that aren't ok."
I disagree. All the people that are "OK" is what will put a floor under the market. Whether it is financially prudent renters that have previously been priced out (or just scared away by stupid valuations) or investors looking for rental properties there is some latent buying pressure. The only question is how low do prices have to go to lure those people into the market? Based on some US bubble cities - quite low. But then again as Introvert keeps reminding us Canada is not equal to the US and Victoria is not equal to Las Vegas!
Leo - I think you are just coming at things from a different angle. I am looking long-term because I own or maybe personality. Most are looking shorter term because they wish to purchase a primary residence at a better price and are waiting for a drop and looking for signs of this.
As for all the people that won't be okay, I don't know what to say. I have empathy for not being okay having experienced that too - financially and emotionally - at times. I just am not sure people will not be "okay". What does that mean? Will it occur? What are we talking about really.
I was reading tips from the great depression today. I couldn't help but think that something is really off-kilter about how we view not being okay financially. I also thought, hey, back then all of the energy that a consumer society directs at increasing consumption was really being directed at survival.
There was one story about a fellow who did well through depression. He had a recipe that included an acre of land to grow things, a flat-bed truck (for hire), rabbits for meat cause they are easy to care for, a goat for milk cause it is cheaper than a cow, and some chickens for eggs. He bartered extra for what he needed and did well.
I can't help but think that our idea of hardship ie. losing your home to bankruptcy with a social safety net, is not really survival level hardship. Maybe the real hardship is culturally created by consumerism.
BTW - did you just call me irrelevant??
So all your sage advice on how doing your due diligence will prevent problems is based on a sample size of 1 actual tenant and a couple friends.
I'm afraid so, Leo.
Being young can be a curse!
I can't help but think that our idea of hardship ie. losing your home to bankruptcy with a social safety net, is not really survival level hardship. Maybe the real hardship is culturally created by consumerism.
Bravo, Totoro. Great point.
The worst-off Canadian probably lives higher than two-thirds of the globe.
FYI - I was joking. I don't care if I'm irrelevant.
It does raise an interesting question though. If the only people that matter are the ones that are not okay what does that mean about this blog?
Does that mean that we are concerned about them and trying to raise alarm bells, despite the fact that we are talking about people who have already bought for the most part, or that we are waiting for them to not be okay so we can cash in?
Kind of an ethical dilemma.
Property managers manage many units at the same time and take about 10% of the rent.
But behind every property manager is an owner that stands to lose the rent. I don't see why a property management company can't do all the things you listed. I could see they might be a bit slower to react though.
I have had zero vacancy for month to month rentals or longer-term leases.
Good on ya. Clearly you know what you're doing.
I just am not sure people will not be "okay". What does that mean? Will it occur? What are we talking about really.
I'm talking about all the people that have to sell. Those people that can't wait out any decline and sell at a loss for whatever reason (job loss, divorce, relocation, living beyond their means, etc). I don't know what you're getting at with the comparison to the great depression. The people that lost their houses in the US weren't starving, but they still lost their houses.
BTW - did you just call me irrelevant??
Yes!
Does that mean that we are concerned about them and trying to raise alarm bells, despite the fact that we are talking about people who have already bought for the most part, or that we are waiting for them to not be okay so we can cash in?
I think the alarm bells are for the people that haven't bought (cue Introvert: "We're gonna go deaf after 5 years of alarm bells"). For those who did, I'm for personal responsibility, so the latter.
If conditions declined and I had trouble renting I would immediately:
Executive summary: take a lower return on investment than you had anticipated.
And so will most other landlords.
Which was my point. And Leo's. You might not go under, but others will.
Some copy and paste joy
from http://www.naibc.ca/images/reports/Victoria%20Outlook-2012-Web.pdf
"Victoria, the capital city of British Columbia, has five primary economic drivers that include the provincial seat of government, the University of Victoria, high technology, tourism, and the Department of National Defense, which operates Canada’s largest naval base on the Pacific coast. Since the fall of 2008 when the financial crisis swept across North America and the rest of the world, two of the major economic drivers, government revenue and tourism, have been negatively impacted.
The office market has begun an uneven recovery after three years of increasing vacancy rates. The suburban office market has seen private sector growth, particularly from high tech firms, filling spaces vacated by the public sector. The supply of new office space has continued to be stifled by existing inventory (Uptown) and limited new demand for Class A space. Over-all office vacancy rate is expected to continue to trend downwards but will remain above historical levels (9% downtown and 8% in the suburbs). Lease rates are expected to remain stable.
The industrial market is slow but steady demand and limited new supply will result in below 2% vacancy rate in the downtown industrial areas and about 5% in the suburbs. Land values have held steady contributing to stable industrial rents. Due to lack of additional capacity and low vacancy in established industrial areas (particularly downtown), growing businesses will continue to look for expansion options outside downtown Victoria.
The retail market in the downtown core has shown weakness due to the anemic economic recovery and continued softness in the important tourism sector. The restaurant sector was hard hit by new minimum wage legislation, tightened drinking and driving regulations and the introduction of the Harmonized Sales Tax (HST) to restaurant meals. Vacancy rates in the downtown core are expected to hold steady at around 7%. Regional and community retail centres in Greater Victoria experience a healthier 2-3% vacancy rate. Lease rates remaining stable.
The Investment market in Greater Victoria continues to be frustrated by a lack Sellers. Low interest rates, a volatile stock market, and an over-supply of qualified purchasers chasing the limited number of available investment-grade properties will keep cap rates down. Cap rates on prime commercial properties have remain unchanged at 6% to 7% with multi-family apartments unchanged at around 5%."
Post a Comment