CPH Real Estate Blog

In the local papers the President of our Real Estate Board spoke about what’s happening in the market.  You can read it here.

 

http://www.northumberlandtoday.com/ArticleDisplay.aspx?e=1163944

 

Bravoooooo !!!!

 

It seems that too often the industry wants to hide it’s head in the sand and paint a rosy picture.  In this case we’re only on the beach !!

 

Without Hitting The Panic Button

 

It is very important for both buyers and sellers to have a reasonably accurate idea of how things are going if they are going to make informed decisions.

 

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A True Story …..

 

This week I met a young lady who was looking for a condo …. But after our initial interview it became clear that because of her situation buying anything at this point could be a mistake.  She had just graduated and was  working under a 1 year contract with a government agency. Next year her contract could be extended for another term, or she may be offered a full time position.  But  she could just as easily be moving within the agency or changing jobs all together.  In which case she’d have to sell whatever it is she bought.

 

QUESTION: Is now a good time to make a short term investment in real estate. 

 

After exploring the costs to buy and carry a property, then estimating the costs associated with selling we were able to estimate how much the property would have to appreciate in order for her to break even.  We then considered the existing market – inventory /  recent demand / tracking the sales – price history … to try and determine if it was reasonable to expect short term appreciation and also try to estimate the future demand.

 

It was important to her that if another opportunity came along she not be held back trying to sell a property.

 

At the end of the day she came to the conclusion that right now – for this year -  buying real estate could be to her disadvantage.  She will actually have more options (and possibly more money) by renting.

 

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Now someone might say “You talked out of buying a condo !!!!”

 

But in fact what I did was show her the whole picture and discuss all her options and let her choose  what was best for her.

 

That’s my job.

 

My Issue With The Newspaper Article

 

There is one significant argument I have with the article …. But that’s for tomorrow.

 

Cheers .. and enjoy the sunshine.

It All Sounds So Bad

The Market is off …. inventory is way up….. the economy is on the brink.

But like so many other things you have to look a little harder to see the good side.

The real estate market is still very strong, there are tremendous opportunities for both buyers and sellers … you just have to know what to look for .. or what NOT to look for.

The average home buyer is not a real estate investor.

The average home buyer is first and foremost looking for a place for their family to live.  It may be location, size, condition or any number of factors that are the basis of their decision about what home to buy, but typically the “quality of the investment” is way down the list.  Don’t get me wrong, they want to make money, but it’s really about a place to live.  The dollars will come later.  For those people, there really isn’t a bad time to buy a home.  Just like dollar cost averaging in funds investing … when you buy a home to live  in … over a period of time the natural cycle will result in the home appreciating in value. 

Prices go up and down … but they rarely go down below where the cycle started. 

Think of a set stairs … prices go up 2 steps and fall back 1.

Unfortunately, if you’re selling at a time when the market is falling back 1 step … you feel like you’ve lost money based on “what you could have got if you had sold last year” ….. I guess that’s human nature, but the trap there is using old data to overprice your home to “today’s market .  Your home sits unsold, and if prices slide you have to follow them down …. It can cost more.

Today .. a large number of sellers are on the wrong step..

For most people selling anytime is about how much they MAKE - not how much they LOSE.

Most people buy a house .. then someday sell a home.

And I think that’s as it should be …. but those are the  people who sometimes need help them seeing  the big picture … an experienced and independent perspective to help them make informed, practical decisions. 

Cheers ….  Dave

Ready When You Are

 

THE MARKET IS DOWN !!!  How’s that for a blanket statement ?

Unfortunately, the conversation needs to be / should be a bit more involved than that if we want to really understand what’s happening.

Generally

As is the case with most of Ontario, our market has been suffering this year.  The real estate season typically tracks in a fairly predictable pattern.  This year it hasn’t acted in the way we would expect.  The number of houses selling is considerably less than normal, while the number of homes coming on the market is actually a bit over what may have been predicted.

The result:  Supply and Demand

Economists tell us that in a balanced, healthy real estate market we should have about 5 months inventory ahead.  At that rate neither the Buyer or Seller has an advantage .. all homes should bring a fair value. 

Imagine the real estate market as  a store, and the delivery trucks brings stuff everyday to put on the shelves.  If you were running your store properly, based on the volume you are selling you should have enough on the shelf to last 5 months - IF THE TRUCK STOPPED COMING.

 Less than 5 months = Sellers have the advantage

More than 5 months = Buyers have the advantage

As of August 1 2008 - Based on current demand we had 11.54 months inventory ahead - if no new homes come on the market.

Click Here To See The Story Graphically

It’s not all Doom and Gloom … but it may be time for a reality check..

Homes are still selling, and for the most part prices are still good.  However, there are a number of factors at play that are impacting local real estate.

More Next time.

Today’s Feature Property ~ A Cottage In Town ~

IT’S  BEEN  A  GREAT  DAY  !!!!

It’s not always about the show .. or the money .. or the prestige.

Today was especially good because I had the pleasure of helping a seller at the end of the home ownership journey … someone who had lived a long time in the same place, and loved it, loved the slope to the floors, the creek of the doors and old glass in the wooden sash that need some paint .. leaving will be hard but nesessary.  We were able to find a family that loved the home in the first five minutes and knew they had to have it for their own.  In the end a fair and accommodating deal was struck .. and everyone is really happy. 

Now, I worked with this homeonwer for almost exactly 12 months.  Starting with inspecting the property, investigating the issues, recommending repairs.  Taking photos of the seasons, securing a web address and building a complete web site for the home.  Identifying the target buyer pool and designing a marketing plan to reach them.  After 6 month of preparation we listed it for sale.  After 6 months on the market we found the buyer that knew “in 5 minutes” it was their dream come true.  I think that’s really cool.

On the other end .. I was lucky enough to spend an hour working with couple who are trying to buy their first home and start the jouney.  It’s one of the buyer types I enjoy the most, they need more information, they’re anxious to learn and the process is so much more than finding a home.  We spend a great amount of time discussing what home ownership is about when considering a home, an investment and the future.  It’s a great way to spend some time.

Just like golf …. this was the great shot that’ll keep me coming back. 

As our market changes .. these conversations will become more common.

Less about sales and more about information …. I really like that.

Cheers ……………  Dave

It’s been another really wet day .. It’s amazing how the weather can influence the telephone .. they seem so unrealted .. but every time we have a rainy day the phone just dosen’t ring !!!!

We’re having some climate issues …

This has been an especially wet summer season.

The econimic climate for this part Ontario has not been rosy.

The price of gas has kept people at home.

EXCEPT people with great big cabin cruisers.  It’s amzing to me .. every morning, winter or summer my dog (Foxie) and I walk the  beach and harbour area.  This year I’m blown away by the number of large power boats that have been coming in.  Maybe it’s the bad weather they’re trying to shelter from, but I don’t know .. this morning 14 large boats left in a convoy at dawn .. I figure each spent $ 50.00 just getting out of the harbour.

The slowness has started to have an effect.  It looks like some selles are coming to the market a bit more motivated than we’ve seen in the last little while … More about that tomorrow.

Anyway .. a slow real estate day .. which allowed me time for building the network on the 2 new servers .. so there’s always lots to do.

See Ya ……   Dave

Well here we go again. 

This will be the 3rd blog I’ve started to date.  However, this is the first to be hosted on my own server.  I kind of like that idea and I’m committed to posting on a regular basis .. or trying to find some way to use this blog as a means to share the information that to this point I’ve been posting to private web pages.

Reason for the change is I’ve had to change servers after 4 years.  It’s only when things go wrong do you appreciate how right it’s been for so long.

Anyway .. I’m in the middle of reconfiguring 112 web sites on a new server, which  would be a dounting task for someone who knew what they were doing .. I’m just going to stay with it till it’s done.

See you .. Dave

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