Since I heard someone say "MOVE!" , I thought real estate would be a good discussion topic.
I keep hearing about the market cooling off, but prices never seem to drop for what I'd call "middle class" homes. It's always the same overpriced junk on the market month after month.
800K for a mediocre, architecturally-uninspired, 1970's house in the suburbs with no garage and minimal updating. Yeah, I'm sure people are totally lining up for that. Must be why these places sit on the market for 12 months with no offers.
Abby_wx wrote: ↑Wed Feb 20, 2019 1:57 pm
Since I heard someone say "MOVE!" , I thought real estate would be a good discussion topic.
I keep hearing about the market cooling off, but prices never seem to drop for what I'd call "middle class" homes. It's always the same overpriced junk on the market month after month.
800K for a mediocre, architecturally-uninspired, 1970's house in the suburbs with no garage and minimal updating. Yeah, I'm sure people are totally lining up for that. Must be why these places sit on the market for 12 months with no offers.
Is it in the snow zone? Might be worth the price then.
It's counting the smilies in the quoted message as part of my total. (deleting them now)
Yeah, I suppose it is a snow zone of sorts. That particular house is located near 108th avenue in North Surrey - not quite Guildford, but not quite Whalley either.
However, houses with the same general attributes can be found all over Surrey, Langley, Maple Ridge, and possibly Coquitlam for basically the same price, plus or minus $50K.
If you just want snow, your better bet is somewhere on the North Shore, or maybe up on the mountainside in Chilliwack.
Abby_wx wrote: ↑Thu Feb 21, 2019 5:43 pm
Yeah, I suppose it is a snow zone of sorts. That particular house is located near 108th avenue in North Surrey - not quite Guildford, but not quite Whalley either.
However, houses with the same general attributes can be found all over Surrey, Langley, Maple Ridge, and possibly Coquitlam for basically the same price, plus or minus $50K.
If you just want snow, your better bet is somewhere on the North Shore, or maybe up on the mountainside in Chilliwack.
I said that jokingly but it's funny what people consider important when buying a house. There's a farm not far from me and I couldn't believe what they listed it for, over a million! Nice place, modernized house, barn and riding ring for horses, but it's still on the market, many, many months later. I think they listed as prices were peaking and the market has now softened so it'll be a hard sell.
Abby_wx wrote: ↑Wed Feb 20, 2019 1:57 pm
I keep hearing about the market cooling off, but prices never seem to drop for what I'd call "middle class" homes. It's always the same overpriced junk on the market month after month.
800K for a mediocre, architecturally-uninspired, 1970's house in the suburbs with no garage and minimal updating. Yeah, I'm sure people are totally lining up for that. Must be why these places sit on the market for 12 months with no offers.
the funny thing in this city is that the locals simultaneously want affordable prices for homes except theirs, theirs has to sell for a premium
seriously though, jmho but I think what we are seeing is the next step before capitulation. people are still stuck on the idea that their home will sell for prices that might have been acceptable 2 years ago.
as far as I can tell it's a combo of seller greed and lousy realtors who are telling people the market will come back.
once the people who have to sell lower their prices I think we will see a broader correction. as those homes will be sold first and desperation will drive the others. I doubt the prices will drop 60% as some are speculating but they will drop more than the 10-15% we've seen so far.
Roberts Creeker wrote: ↑Thu Feb 21, 2019 7:41 pm
I said that jokingly but it's funny what people consider important when buying a house. There's a farm not far from me and I couldn't believe what they listed it for, over a million! Nice place, modernized house, barn and riding ring for horses, but it's still on the market, many, many months later. I think they listed as prices were peaking and the market has now softened so it'll be a hard sell.
Farms are harder to sell than single family homes already (niche market so to speak, plus you only get the principle residence exemption on 1 house and a acre or two of land) overpricing it ain't going to help
Roberts Creeker wrote: ↑Thu Feb 21, 2019 7:41 pm
I said that jokingly but it's funny what people consider important when buying a house. There's a farm not far from me and I couldn't believe what they listed it for, over a million! Nice place, modernized house, barn and riding ring for horses, but it's still on the market, many, many months later. I think they listed as prices were peaking and the market has now softened so it'll be a hard sell.
Haha, yeah. First world problems... but we all have them.
I definitely consider the climate of an area, but it's not my main criteria. It could be a tie-breaker if I was trying to decide between two houses in different locations.
I know what you mean. That kind of seller won't wake up until prices have already dropped substantially. By the time they come to their senses and drop their asking price, the market will already be a step ahead of them. They will end up "chasing down" the market. They'll probably end up getting less money in the long run than they would have had they set a lower price to begin with.
moonshadow0825 wrote: ↑Thu Feb 21, 2019 8:23 pm
the funny thing in this city is that the locals simultaneously want affordable prices for homes except theirs, theirs has to sell for a premium
seriously though, jmho but I think what we are seeing is the next step before capitulation. people are still stuck on the idea that their home will sell for prices that might have been acceptable 2 years ago.
as far as I can tell it's a combo of seller greed and lousy realtors who are telling people the market will come back.
once the people who have to sell lower their prices I think we will see a broader correction. as those homes will be sold first and desperation will drive the others. I doubt the prices will drop 60% as some are speculating but they will drop more than the 10-15% we've seen so far.
Yup, I completely agree. People are conditioned to believe that prices only go up, or at worst stay flat for a couple years and then resume going up. They think they just have to wait it out. The RE industry perpetuates this mindset with their rosy forecasts of a "soft landing". It's going to take a while for reality to sink in, but I think we're getting near the capitulation point, as you put it.
A broad correction of 30-40% wouldn't surprise me.
Abby_wx wrote: ↑Thu Feb 21, 2019 8:56 pm
Yup, I completely agree. People are conditioned to believe that prices only go up, or at worst stay flat for a couple years and then resume going up. They think they just have to wait it out. The RE industry perpetuates this mindset with their rosy forecasts of a "soft landing". It's going to take a while for reality to sink in, but I think we're getting near the capitulation point, as you put it.
A broad correction of 30-40% wouldn't surprise me.
30-40% would be shocking , that means going back to approx 2014 prices,average older homes in South Surrey were selling for $600,000-700,000, now they're over a million. I certainly can't see my condo dropping $150,000-200,000.
Forrest Gump wrote: ↑Thu Feb 21, 2019 11:25 pm
30-40% would be shocking , that means going back to approx 2014 prices,average older homes in South Surrey were selling for $600,000-700,000, now they're over a million. I certainly can't see my condo dropping $150,000-200,000.
I don't think condos will moderate as much for a couple of reasons:
1. even at the low end of your range $600,000 is still too much for many first time buyers, especially if renovations have to be done in an older home, between rising mortgage costs, cmhc financing and property insurance there won't be much left at the end of the day to justify such a purchase for many. I've been teaching my kids (17 and 24) that they shouldn't expect to purchase a single family home right away but instead start with a condo and build equity over time so they can purchase up later.
2 that millennial/gen z group aren't as land focused as we were taught to be. from what i've seen of my son's friends they want condos as the lower overall cost allows them a more mobile lifestyle.
3. remember that book "Boom, Bust & Echo"? the author was a good demographer. I'm a wealth planner and we regularly see the high net worth spectrum wanting to downsize in space but stay in their same neighbourhoods. this means condos.
so between pressure from above and below the condo market may just weather a downturn.
Abby_wx wrote: ↑Thu Feb 21, 2019 8:56 pm
Yup, I completely agree. People are conditioned to believe that prices only go up, or at worst stay flat for a couple years and then resume going up. They think they just have to wait it out. The RE industry perpetuates this mindset with their rosy forecasts of a "soft landing". It's going to take a while for reality to sink in, but I think we're getting near the capitulation point, as you put it.
A broad correction of 30-40% wouldn't surprise me.
do you see 30 - 40% from here or the peak in 2017?
moonshadow0825 wrote: ↑Fri Feb 22, 2019 5:36 am
I don't think condos will moderate as much for a couple of reasons:
1. even at the low end of your range $600,000 is still too much for many first time buyers, especially if renovations have to be done in an older home, between rising mortgage costs, cmhc financing and property insurance there won't be much left at the end of the day to justify such a purchase for many. I've been teaching my kids (17 and 24) that they shouldn't expect to purchase a single family home right away but instead start with a condo and build equity over time so they can purchase up later.
2 that millennial/gen z group aren't as land focused as we were taught to be. from what i've seen of my son's friends they want condos as the lower overall cost allows them a more mobile lifestyle.
3. remember that book "Boom, Bust & Echo"? the author was a good demographer. I'm a wealth planner and we regularly see the high net worth spectrum wanting to downsize in space but stay in their same neighbourhoods. this means condos.
so between pressure from above and below the condo market may just weather a downturn.
Yes condo market will probably hold its own, especially in South surrey/White rock as I'm sure it's a highly desirable area, but having said that 3 units in my building have been on market for several months now with no bites.
So , I presume your kids go/went to delta sec? I just retired from there.
moonshadow0825 wrote: ↑Fri Feb 22, 2019 5:38 am
do you see 30 - 40% from here or the peak in 2017?
30-40% from the peak. That's just my best guess.
Some will argue that 40% is extreme, but I think people forget how long we've been blowing this bubble. If you look at the charts you can actually trace it back to 2003/04. We've seen a couple of minor corrections along the way, but nothing proportionate to the size of the bubble.
It depends on property type, though. Detached homes should see the largest drop because they're the most over-valued. They were already considered overpriced in 2014, while condos and townhomes were still reasonable at that point.
Forrest Gump wrote: ↑Fri Feb 22, 2019 9:25 am
Yes condo market will probably hold its own, especially in South surrey/White rock as I'm sure it's a highly desirable area, but having said that 3 units in my building have been on market for several months now with no bites.
So , I presume your kids go/went to delta sec? I just retired from there.
Yes both, Youngest is graduating this year.
You didn't happen to teach drafting did you? (If that was too nosy feel free to ignore me )
Abby_wx wrote: ↑Fri Feb 22, 2019 9:29 am
30-40% from the peak. That's just my best guess.
Some will argue that 40% is extreme, but I think people forget how long we've been blowing this bubble. If you look at the charts you can actually trace it back to 2003/04. We've seen a couple of minor corrections along the way, but nothing proportionate to the size of the bubble.
It depends on property type, though. Detached homes should see the largest drop because they're the most over-valued. They were already considered overpriced in 2014, while condos and townhomes were still reasonable at that point.
I wouldn't be one of those who thinks that too extreme. I wish the REB publushed charts that went back to the 80s or even 70s. I think it would give a more tempered view of the ebbs and flows of the market.
What we've seen recently is an aberration and I'm of the belief that physics works in markets jyst as much as it does in life.
When I was a lender in the late 90s I had clients who owed more than they owned. People forget about that.
who are telling people the market will come back. 
as those homes will be sold first and desperation will drive the others. I doubt the prices will drop 60% as some are speculating but they will drop more than the 10-15% we've seen so far.
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