Psst… Wanna Buy a House
Looks like real estate “reality” is on its way to Vancouver… and hopefully in the next 6-12 months prices may go from “it’s how much!?!”, to “it’ll only take half of our income to pay the mortgage”
Here’s a few observations from Vancouver real estate blogs. (hint: watch the realtor blogs of you really want to know what’s happening – In Florida they went through sheer panic as the decline started)…
This from realtor Jeff at Rob Chipman’s blog
“No open houses for me this weekend. Why bother, no one would show anyhow. I have 8 listings sitting on the MLS and I got 1 phone call for a showing for Monday evening. The seller did 2 price drops on that particular listing and the 2nd price drop got processed on Friday. Time and time again, I have proof that price is the single biggest factor influencing the sale of a property. If any Realtor tells you they have a 20 point marketing plan… it’s BS. If they tell you they have a full marketing program and promise significant exposure… again it’s BS. I’ll tell you what sells properties… MLS and PRICE.”
This from house browser exx at Rob Chipman’s blog
“We went to 6 open houses today in Port Moody, completely at random but all 2bed/2bath, which is what we’re looking for. They ALL had 3 things in common: 1. 60+ DOM, 2. Motivated Sellers, 3. Prices reduced repeatedly (20-40K). Another thing in common, though with the realtors, was the acknowledgement of a very different market. A couple of them pushed the “It’s a buyers market now, you have room to negotiate” line. Room to negotiate? Yes. Buyer’s market? Not yet, but it’s getting there! I got to talking with one of them who went off about how last year at this time there would’ve been multiple offers. Now she’s insisting to people, us included, to just MAKE an offer.”
In the US, the sign of the demise (the mortgage mess is a reaction to it/ not the cause) was when rents became half or less than the mortgage on a home (with 25% down). In Miami rent is now getting to almost the same as the mortgage – meaning the bottom is near.
This is after a 25% + decline – a 3,000 sq ft home now can be had for 500K
In Vancouver I am paying rent of about 40% of what it would cost me to buy the place. Once it gets to 70% (meaning a decline of about 300K) I’ll be interested in buying a home.
For now, I am sure there’s no upside in this market.
….
June 25th, 2008 at 1:42 pm
How about this: we’ve missed out on 5 mulitple offers in the last two weeks. Anecdotal reports of the death of this market are exaggerated. It’s certainly changed from a red-hot record breaking beast, but we haven’t seen many price breaks yet.
June 25th, 2008 at 9:51 pm
Like the comment on your link said..
The Olympics are coming, prices will go up, the Olympics are coming!!! The last one to trust is a realtor.
I’m with you – I am going to sit for the next 6-9 months and watch this ‘correction’
I can see it when I watch the MLS. Houses are dropping (re-listing at a lower price -nice trick) everywhere outside of central Vancouver.
I sold a year ago, banked the money, renting for the cost of taxes, maintenance and a $200K mortgage. And it’s a lot better than the home I owned.
June 27th, 2008 at 9:13 am
The real estate here is a suckers game now… this isn’t New York.
I am starting to notice rent is dropping now too.
My worry is that Vancouver’s economy is built on the real estate price increases. What happens when the prices drop to real world values?
I agree that the US is a good example of what’s on the way.