Another crazy day. Do you think our city of Victoria will ever get to PANIC mode? People do seem a little tense about the recent happenings. Housing is no longer a given, and with so many blue hairs in our city, the stock market is a definite concern. Hopefully people near retirement age have done their financial planning and thrown most of their savings into something secure.One day until October. I'm still guessing around 280 SFH sales in September, with a median just below $500k and an average around $550k.
If those numbers are close, as a renter I'll have made $20k since last September, as last year's median was $520k. Shucks, that more than pays for this previous year's rent! Maybe a new show for TLC should be Renter Ladder (not Property Ladder), featuring renters climbing the real estate market ladder by not having bought!
62 comments:
That's pretty close to what I'm predicting with my weak math skillz. Let's hope it comes true (or more!).
As a side note, our graphic designer walked in to work today, elated that his brother had just bought a house and was finally moving out of his place. His brother offered $450k against a $500k list price - and was accepted.
Womp -
that's my own strategy. There always has to be someone who gets the deal that actually moves the bar lower. If I'm that guy, I don't really care what happens after that.
Man, those optimists never give up do they? Pre-market data today is looking like another massive post-dip rally is about to take place (that's why gold is being slapped back down - at least in part).
What is actually driving the rally this time around? I have no idea... optimism that 2nd time on Thursday will get the 700 billion bail-out through!??
All I know is this is getting to be a pretty damn predictable pattern - but I still don't have the guts to invest on it.
What's as good as gold, and edible too?
In other news, for the rest of the bears out there that aren't quite into buying gold, I have just found you an alternative stock that you can both invest in, and actually eat if you buy the physical asset instead of the paper version.
That's right, out of the HUNDREDS of stocks on the dow jones yesterday that went down... 1 ... ONE single stock went up and up high, and that was (drum roll please...)...
Campbell Soup!
Wow, talk about a bomb shell bunker stock! Those loonie tunes conspiracy theorists with them bunkers filled with canned soup must be waving their "I told you so" flags today!
LOL
Yes it is the Thursday vote effect coupled with more Euro problems that are propping up the US dollar thus knocking gold back abit.
I have to disagree with you Mr 4 AM on the bailout. So many of you get it wrong, it is saving Main Streets ass not just Wall St. I got into this with my US buddy who is also under the misguided notion that things will be so much better if things are allowed to completely crash to oblivion.
Now who do you think is going to come in at the bottom and clean up on all the carnage for pennies on the dollar ? yep, the Wall St fat cats that so many hate, cause they have all the bucks from cashing in at the top and the whole process repeats itself. There won't be some new found system that changes the world, greed will always rule the day and they will find a way around any new rules to milk it again.
A correction is in order but a total destruction of the system to ground zero is not in anyone's best interest.
Excuse my ignorance.
What really is happening to the assets of these companies that are going to be bought up for pennies on the dollar? The buildings, desks, telephones, client lists, etc. are still there and are still inplace.
So XYZ bank goes on the auction block and ABC bank buys it for 20 percent of its high price. What's has changed? You still pay your car, credit and mortgage payments every month only this time to ABC and not XYZ.
I don't like the government bailing out the XYZ companies as it is squeezing out the ABC's from aquiring and growing. I favour Darwinian economics.
What if the USSA financial institutuions are bailed out. And a significant portion of the remaining world's institutions go belly up. Since its a global economy and institutions are inter connected, will that only delay the USSA institutions from collapsing?
You can't save a sinking ship by filling it with gold bars.
I say let her crash, then the USA will know where the economy is broken and make the repairs as needed. Besides, the yanks will need that $700,000,000,000 for beefing up their domestic police and military role.
Not many reporting that the FED injected $630 billion yesterday and the market still dropped.
The market NEEDS to crash. It needs to be cleansed. The bailout is a disaster becuase it just gives the junkies another hit, nothing else. The sooner they stop wasting cash on a bunch of junkies the sooner they'll get to the bottom and turn things around. Parties have to end, and the hangover will alway follow. Yes, there are tough times ahead no matter what happens - why can't people accept that?
Of course they will change a few things and they will pass this bailout bill - and it will be looked back upon by the history books as a massive failure, just a brief footnote on the way down. Remember 1929.
VG,
A bailout (in the current terms) would only temporarily save mainstreet by propping up wallstreet. The problem is that it is purely just a bailout without any immediate meaningful reform of how wallstreet works. As the other anon put it, it is like giving heroin to the junkies. Sooner or later, they'll use it all up, and be back for more "or else!!!".
In the mean time, 700 billion in actual real currency gets thrown out the window while the root symptoms only get worse (deeper housing slump, deeper consumer debt, continous collapses of whatever didn't qualify for bailouts, further hogging of cash by big institutions because of lack of inter-bank trust, etc).
If they said, ok here's 700 billion dollars, but we're immediately changing the following 10 or 20 ways the market works to minimize leverage, introduce enough TEMPORARY regulation/oversight, rules on how the money can be spent, while ensuring tax payers don't get hung for the bill, not letting CEO's and board members walk off with any bonuses until the company's are sound by a 3rd party's definition, revamping all the ratings agencies methods, redefining GDP, CPI and the other fuzzy math spin tools, then I'd say a bail out would make more sense... because it is accompanied with sensible reform. Otherwise it is nothing but a synonym to caving like parent trying to deal with a child throwing a fit by giving it candy and toys to shut it up instead of putting it in the corner & upholding some rules super nanny style. You can kiss the child later and give it love ($), but first respect and rules need to come into play, otherwise abuse will ensue and escalate.
Now having said all this, do I really believe this is possible in a matter of 2 or 3 weeks - no way. This is stuff that would take 1 to 2 years if the right minds worked on it full time... which is why I conclude that it's all going to hell be it a YES vote or a NO vote.
it's everywhere like this now.
Why don't they try something like what Sweden did in 1992 if the "solution" is coughing up big loans to private business?
Methinks suddenly a lot of big banks with their hands out would suddenly walk away from handouts they don't really need, if forced to trade equity for handouts. For the others, let the public take over if public is taking on the risk.
Article is from the NY Times and well worth reading.
Campbell's soup going up... hysterical... anyone remember the US soup lines of the Great Depression?
Funny. All this talk of frozen credit markets,bad bank balance sheets etc. Yet today Royal Bank Visa sends me cheques for a 1.99% rate till Feb 09.
That and the market has regained more than half of yesterday's losses.
Fear and lies.
But we are an island. This won't happen in our Canada's Hawaii. Beautiful skies, sunshine year round, antique cars everywhere, fragnant diesel fumes, low education levels, chain smoking white trash. What a paradise (oops parasite) we live in.
It's about time...people there are getting mighty cocky...time for a nice knock on the head for everyone to come down to earth.
Just messin around to see if I can put my picture up.
Just to let everyone know that real estate sales on Vancouver Island will be increasing very soon!! Seems like there will be a large injection of cash into the BC economy over the next few months.
hehe, you had me there for a few seconds Roger. Funny, but also a sliver of truth to that I'm sure.
Well if you want to see the whole financial system meltdown then I guess you have some sort of distorted perception of what normal life would be in this world.
If the corporation you and I work for can't pay us cause the cash is all frozen and we are both out of work then how is that a good thing ?
I am confused how some of you don't get the implications of what is happening here. By injecting cash into the system it is doing the opposite of what they did in 1929 and to not tighten credit as back then but to keep it flowing. In 29 they cut off the credit so no one could borrow and everything shut down. Right now credit is not being lent to all levels of business, the rates banks lend each other at all time highs, what does that tell you ?
You may call it plugging the dike, I call it avoiding a catastrophe of unprecedent proportions. Letting it all tank to zero is the most brain dead thing that could happen.
Look for worldwide interset rate cuts coming very soon or this whole puppy shuts down.
vg said: "By injecting cash into the system..."
Unfortunately that is not really what they are doing. They will be purchasing the worthless MBS from the last of the investment banks which will then allow those same banks to invest the cash elsewhere - the next bubble so to speak. Oil? Corn? You name it, and it will get lost there too.
This is nothing more than Paulson and Bernake bailing out their buddies at Glodman Sachs, no matter what Bush calls it. They should all be tried for treason.
"Unfortunately that is not really what they are doing"
Unfortunately you don't get it's the same thing,money is put into the system in various ways to unfreeze not just given to them to invest,they also lend out the money as well and create the credit flow wether they buy debt or inject cash to lube the system. Lets not twist words into something they aren't, it was a blanket comment,cripes almighty.
vg, sorry if I offended you. Here are the more educated reasons why this won't fix anything:
http://tinyurl.com/3zm28k
http://tinyurl.com/4s8x7a
no problem anonymous,I may have misinterpred your post.
A friend who sees it the same way you do and sent me that first guys article.
Everyone has an opinion,and I am no economist by any means. I just see them trying to stem the flow of bad debt problems that is now cascading around the world by the hour. I believe the main reason for this is to inject confidence into the financial system more than anything and if it works in the short term then America with a new president in a month from now ( and I don't mean the old guy) will try to deal with the mess they inherited.
To me the world is such a complex place versus 1929 that we don't want to ever find out what it would be like for Depression Part 2, so anything that stems this possibility while trying to rebuild on new footing is the best solution. Hope beats despair anyday in my books.
On some levels I have to agree with VG. The "free market" is simply not always self correcting. I think people need to remember that markets in the past, The Great Depression is a classic example, can spiral down in disequalibreum without some sort of external (ie. government) intervention.
I would suggest people read this excellent explanation of the role of credit default swaps in this crisis.
I'm not so sure that even the biggest banks or insurers are interested in gobboling up their smaller rivals right now. There are clearly bargains to be had but very few have been purchased because of the difficulty in valuing the risks, either in outstanding sub-prime loans that are in default or in the case of insurers, in the claims on credit default swaps.
Don't forget that banks make money on interest earned from lending money, not on buying up the assets of other bankrupt banks. If banks won't lend because of the high risk of default (a risk now hugely inflated because the insurance on that risk, credit default swaps, are now seen to be unreliable) then businesses can't invest, consumers can't consume, payrolls can't be met. This leads to recession and to even greater risk on lending and so the cycle continues downward.
Keynes called this the liquidity trap. But then, hey, Mr. deregulation, "free-markets are a religion", Milton f-cking Friedman is a god and who the h-ll is Keynes.
Just when you thought it was a US only problem.
Banking crash hits Europe as ECB loses traction
The global credit crisis has slammed into Europe with stunning violence over the last two days, triggering five major bank rescues and a near total shut-down of the region's credit markets.
Analysts say German finance minister Peer Steinbrueck may have spoken too soon when he crowed last week that the US would lose its status as a superpower as a result of this crisis. He told Der Spiegel yesterday that we are "all staring into the abyss".
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/3104666/Banking-crash-hits-Europe-as-ECB-loses-traction.html
It's over. At this rate, we're going to have another Great Depression.
With another Great Depression coming, you would have to be nuts to purchase real estate!
The chance of a depression hitting hard are unfortunately all too realistic. On one hand, you can say, stock up on food and other such things, and on the other you can just keep working, hedge your bets, save lots of cash. Unless, there is hyperinflation and then it doesnt matter how much cash you have. So... that's why im saying there is no point in going there unless you are prepared to consider the ramifications of what an entirely different mode of living would be, very few of which are habituated towards, or would enjoy. I am not an economist, but my economist friends have finally started to listen to my banter and are now coming around. The whole fucking situation is laughable and alot of people are going to really sufffer. I wish I had some positive news, but what can we do? It will not come as quickly as some would believe, but its affects will seep into every facet of our lives and the results will be apparent and devastating.
Be happy while you can! Go get lots of loans and live it up HAHAHA
Schiller calling for Canada to have a housing meltdown. Can't find the article but it is on BNN headline ticker.
Article here VG.
BULLETIN: Gauge of U.S. manufacturing registers sharpest one-month decline since 1984
10/1/2008 10:05:58 AM EDT
can you say "in the tank" ? that is brutal, the spinoff effect is going to hit Canada very hard.
anonymous 10:31,
great article on explaining the credit default swaps. This is the scariest part of this whole deal,and why government intervention on many levels is mandatory and I hate government getting involved in anything. The unwinding of these insurance policies is the be all end all.
I see Soros is now touting his plan to Obama and the Dems to just buy the equities and not the debt but I think the US political types have now digested the seriousness of this.
Somehow I think Paulson and Bernake know much more of how dangerous this is and didn't want to say on the open air waves or there would be people cleaning out there bank accounts and mass panic.
Good articles. Those CDS's are scary - so the actual number is $50 TRILLION?
That's $166,000 for every US citizen.
Looks like Hank and Ben are just getting started.
The important thing to remember in arguing back and forth about the probable efficacy of the bailout is that Paulson, Bernanke, and everybody else on this planet have no idea what they're doing, or what will happen. It's all plainly being made up as they go along. In the words of an old Wall St hand, "nobody knows nothin'." Anyone who thinks Paulson or Bernanke can see their way through all this is just trying to salve their wounded optimism.
The whole situation is a giant question mark, and those currently in office have shown they didn't anticipate this and don't know how to fix it. You can second-guess the bailout all you want, but it's surely just a coin flip whether it "works" or not, and whichever path we take, we will never know if the alternative would have been better. As a result I think debating the bailout is pointless.
First they said bailing out Bear Stearns would fix it. It didn't. Then they said the housing bill would fix it. It didn't. Then they said bailing out Fanny and Freddie would fix it. It didn't. Then they said bailing out AIG would fix it. It didn't.
Anyone see a pattern developing here?
Personally, I'm hoping that this situation does get a bit worse because history shows that the only time human behaviour really changes is when brought on by a crisis.
I think the one voice I've heard who's consistently been dead-on through this whole episode is Peter Schiff. We have promoted the idea of endless consumption and encouraged people to take on unsustainable debt. We can say that nobody put a gun to anyone's head to buy a house, but when you have realtors and financial planners telling people that renters will always be poor and that if they don't buy a house now they will be priced out forever, that puts a tremendous amount of pressure on ordinary folks.
Realistically house prices should not be more that 3X your annual salary …if I earn 80,000 a year I shouldn’t have to pay more than 240,000 for a home…
End of story – try finding a home in the Victoria Area for 240,000 …although house prices should be even lower than that …average family home should be around 160,000 -> 175,000 …we’ll see the decline over the next 5 years. I for one will be very happy watching people who bought in the upturn loose their shirts. Because I told you so wouldn’t just cut it. I have NO Sympathy …people knew what they were doing… and idiots who borrowed on the equity in their property to buy more property are even dumber
Realistically house prices should not be more that 3X your annual salary …if I earn 80,000 a year I shouldn’t have to pay more than 240,000 for a home…
End of story – try finding a home in the Victoria Area for 240,000 …although house prices should be even lower than that …average family home should be around 160,000 -> 175,000 …we’ll see the decline over the next 5 years. I for one will be very happy watching people who bought in the upturn loose their shirts. Because I told you so wouldn’t just cut it. I have NO Sympathy …people knew what they were doing… and idiots who borrowed on the equity in their property to buy more property are even dumber
b2b, you forgot when they also mentioned that the subprime contagion was "contained", that Europe and Asia would "decouple" and that "our economy is strong" and "on solid foundation".
Anon 8:58,
Peter has been right so far about gold, but he's probably the biggest cheerleader of gold on TV at this point - possibly a little over the top. He also invested in Platinum as if it were a precious metal forgetting the massive use by manufacturing which resulted in a recent huge decline in value. Peter's still way better than any of those other FOX news "analysts" if you can call them that, but I like others that have a little more detailed research behind their campaigning for 'whatever'.
FYI, found a good article this morning on CNN Money about CDS derivatives... you know when this stuff starts making headlines in public information channels, the mania phase is about to begin.
Check it out... The $55 TRILLION Question
You can hang on to your hope...
...Me, I'm hanging on to my gold ;-)
Damn, I should work for a marketing dept!
b2b
re"I think debating the bailout is pointless."
agreed on everything you said--excepting your last sentence above.
You're right--NOBODY knows- but EVERYBODY has opinions.
Civil dialogue, as is usually the norm on this blog, is both interesting and educational--- and useful.
The power of the internet has been particularly effective, recently, in both the pause for a major rethink on the original rushed bailout package in the USA,and ,in Canada, the decision to allow the leader of a political party with almost 700000 voters to participate in the upcoming formerly closed debate.
this is good
hey-when do we get Numbers?
likely excellent---for bears
Made $20K since september? ha...that's funny. "renting is the way to go people!"
NYtimes Buy VS Rent Calculator
Real estate always has, and always will be, the driver of wealth in societies. It has since the beginning of time.
Just ask anyone sitting in a trailer, 75 years old if they wish they invested in real estate 30 or 40 years ago.
I'd strongly suggest you get in the market, when you can. Unless humans stop reproducing, or they start making 'more waterfront' or wonderful places to live like Victoria - prices will rise in the long term. It's simple economics.
Today's balanced market in Victoria is great news. Victoria, and Canada in general, are polar opposites to what's happened in the USA.
Read it and weep, or better yet, get in the market when you can. Pontificating on the sidelines won't help when you're 75.
Scotiabank Mortgage Comparison - Canada and the USA
Even in the states the prices are only down 11.4% year over year July - July.
IAS360 USA Housing Prices
Some US markets have risen.
There seems to also be a fundamental misunderstanding of the liquidity crisis south of the border. The $700 billion is so the average every day person can still get a car loan. A mortgage. The banks don't have money to lend. That's a problem that needs to be fixed.
All the emotional "but da wall street fat cats" is really simplistic, emotional, juvenile trite.
The new VREB stats should be out later today. I will start updating the charts and gallery as soon as I get the numbers.
I was over at Craigslist and saw this flipper ad which has been posted numerous time. Do you think this guy will be left holding the bag??
thanks for the link Mr 4 AM.
Schiller says what I said last night about the bailout :
"He said a bailout might help restore some confidence to the stressed financial system.
"What creates a crisis is a lack of confidence," he said."
Re the proposed "bailout". I thought this was an interesting post from "black swan" on Mish:
"Why would the Treasury swap US treasuries for worthless paper from foreign banks?
Because that worthless paper was originally sold to those foreign banks by US crooks from investment banks like Goldman Sachs. So it's actually worthless US MBS (mortgage backed securities) coming back home to the country of its origination.
Yeah, but just because crooks from the US private sector stuck those foreign banks with this toxic waste, why should the US taxpayers have to pay for it?
Because the toxic waste is forcing the foreign banks to implode. They are not happy with this outcome, so, unless the US swaps them back out of it, they will no longer buy or accept US debt, private or public (corporates, agencies or treasuries).
But why stick the Treasury with this toxic paper return, when it came from the US private sector, and was originated from investment banks like Goldman Sachs?
Because the former CEO of Goldman Sachs, Henry Paulson, is the genesis of this financial asbestos, and he is being held accountable by these foreign banks for defrauding them. Since he is now Secretary of the Treasury, it makes perfect sense that his new organization, the US Treasury, should take the hit. It works well for Henry, because he gets to keep the $700 million he received for defrauding the foreign banks, and gets to stick the taxpayer with having to pay for his crimes.
What happens if the house doesn't pass the bailout bill that allows Henry Paulson to reimburse the foreign banks, with taxpayer money, for his MBS/CDW fraud?
One of two things. The US Government can no longer fund its debts, which would make US treasuries worthless and put the whole country into default, or, the Fed, using its new Suplimentary Financing Account (shadow bank) could create the credit to cover it all, like it did a few days ago when it created $620 billion out of thin air to swap for currency from foreign banks in order to keep the USD from crashing.
Will Congress pass this bill?
You can count on it. The FDIC, which doesn't have the money to insure US bank depositors for $100,000, will agree to insure the depositors for $250,000, as a provision of this bill. It would take a brave Congress member to vote down something that would be so popular with his/her constituents."
VG, I have read that a similar bailout (purchase of toxic debt) in Japan years ago did not then lead to easing of credit/lending between banks. The banks still hoarded as it did not result in an increase in confidence.
The problem with Peter Schiff is he is cheering for his gold holdings to balloon and the economy to crater with a smugness I find very distrubing to have on somewhere like CNN.
He's a fear monger and not that we shouldn't be fearful but you know he is praying every night for armegeddon so he can be right and everyone else who isn't even a homeowner is wiped out. These types disgust me and belong on some infomercial on late night TV.
And don't forget, Peter Schiff is pumping a book. Seems the Garth bashers made a regular point of that.
Numbers are out, pretty flat, median is down $12,000 in Greater Victoria. Funny how they can keep the average at exactly $549,000,hmmm.
Looks like Tony Joe is trying to slough off the financial problems of the world to spin it his way. The truth is Joe Public probably didn't wake up til this past week, watch the winter numbers combined with Schillers comments carry much more weight going forward.
VREB September numbers are up on their site.
http://www.vreb.org/mls_statistics/current_statistics.html
VREB releases September Stats
September 2008 Statistics - Monthly Analysis
August 2008 shown in ()
MLS Sales - 512 (517)
MLS listings - 4,754 (4,657)
SFH Average - 549.3K (549.9K)
SFH 6 mo. Avg. - 585.6K (592.6K)
SFH Median - 500K (512K)
All SFH Sales - 309 (269)
Condo Average - 319.6K (302.2K)
Condo Median - 276K (280K)
All Condo Sales - 111 (160)
Town Average - 405.3K (414K)
Town Median - 370K (382K)
All Town Sales - 53 (53)
Year-over-Year Analysis
GV - Greater Victoria
September 2007 shown in ()
MLS Sales - 512 (632) - Down 19%
MLS listings - 4,754 (3,352) - Up 41%
GV SFH Average - 549,284 (584,193) - Down 6%
GV SFH Median - 500,000 (520,000) - Down 3.8%
GV SFH Sales - 286 (306) - Down 6.5%
GV Condo Average - 319,562 (343,462) - Down 7%
GV Condo Median - 276,000 (289,450) - Down 4.6%
GV Condo Sales - 111 (148) - Down 25%
GV Town Avg. - 411,075 (406,608) - Up 1.1%
GV Townh Median - 372,500 (375,000) - Down 0.7%
Town Sales - 50 (73) Down 32%
Those numbers are stronger than what most were probably expecting. Sales held up with August, SFH prices are generally flat and condo prices took a big jump up.
vg: True enough about Schiff pumping his book and investment firm, he certainly does have a vested interest in his viewpoints. However, he has backed his talk with actions in terms of how he has managed investments, so I like that he's not just one of the professional pundits who has no real stake in the things they talk about.
However, I tend to agree with his pessimism about the state of the US economy. I like that when he's on the talk shows, he always returns to the fundamental problems that the US government and US consumers spend more than they make and that wealth should be built from savings, not predicated on endlessly rising levels of spending and consumption.
As far as his smugness goes, I don't think he's any more smug than many of the real estate bears who called the popping of the real estate bubble. People have been calling him an idiot for the past 3 years the same way that people called Schiller an idiot in 2004-2005. I'd probably want to gloat too.
Dave said:
Those numbers are stronger than what most were probably expecting. Sales held up with August, SFH prices are generally flat and condo prices took a big jump up.
Sorry Dave - You can try and put lipstick on this pig but it just won't work this month.
MLS SFH Sales were similar to August but are still lower than 2007 and 2005 and well below the six year September average
As I have mentioned many times before the average price is a poor proxy for a House Price Index. A better metric is the median price which for SFH has now fallen 5 months in a row! Single family home prices are now down over 10% from the April 2008 peak
Condo sales dropped dramatically in September and the median dropped from August (only the average jumped up) and both average and median are down YOY.
The only bright spot is townhouses, which are holding steady but even there sales are down 32% from last year.
Dave,
The only surprising thing is that sales weren't lower. Maybe there is some truth to people rushing out to get their 40 year mortgage before it's too late. I assumed that wouldn't happen, but then the level of ignorance of the declining market continues to surprise me.
Condos did not "take a big jump up". Sales were way down. The median is down. The sixth month moving average is down.
Average numbers are so volatile that they are next to meaningless in Victoria, just look at the history of townhouse prices.
Good to see that you buy into Tony's hype though. He always picks the one possible positive and trumpets it on their news release. Pretty much par for the Dave course I guess.
The September VREB Stats Analysis slideshow is now available.
Comments and feedback are appreciated.
Seems the mad rush is true:
"We're seeing a lot of applications for 100% financing as the Oct. 14 deadline approaches. A good number of these borrowers don't qualify and most are completely unaware of the 680 minimum credit score for most no-down-payment mortgages"
Canadian Mortgage News Blog:
http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2008/09/mortgage-bytes.html
anon 1:01,
the difference is between a housing price correction and the destruction of the world financial system, thats huge. He is touting the "Americans aren't saving" thing along with many others so thats not news to any us.
It's his cocky smugness I have never seen on any real estate bears faces on the tube. Schiller is quite calm and "matter of fact" and I can't actually recall any real estate bears allowed on MSM talking heads TV the past few years, they have all been banned.
roger,
great charts as usual. Just a few comments on the median price charts.
1. 5 months down in a row has not been seen in I can't remember when. The curling over of the rolling charts says it all, this has much more downside.
2. If next months median price declines goes down a similar amount in the $12 - 15,000 range it will be flirting with the May 2007 median. Thats a fair ways back.
3. The high "new" listings in September going into the slow fall/winter season with the real financial fear just kicking in this week should have a major impact going forward.
Looking just at re-sale condominiums in the Victoria Core.
There were 85 sales last month as opposed to 106 in Sept. 2007.
The median price increased from $267,950, the average condominium size at that time was 931 square feet ($287.80 per square foot), to $285,500 for a 986 square feet condominium ($289.55 per square foot).
So people were paying more for a condomimiun than last year, but they were also buying more square footage. The year over year price increase adjusted for size was 0.6 or a less than 1 percent increase.
I feel sorry for those speculators that are caught with a property they need to dump, and escalating mortgage payments.
I think those speculators need to cut price and sell asap, before the market drops more.
With the turmoil in the U.S., real estate prices may drop twice as fast next year.
I also looked at single family homes on a price per finished square foot rate.
Last month in Victoria's core communities there wer 157 sales with a median price of $550,000 for 1,894 finished sft.
One year ago there were 171 sales in September with a median price of $552,500 for 2,008 sft.
On a price per finished square foot basis home prices in Victoria's core increased from $275 to $290 per sft or 5.4 percent.
The affect of marginal utility or diminishing returns suggests that as the house size increases the price per square foot rate should decrease. Therefore, the 5.4 percent increase would be a maximum. The real increase laying between 0 to 5.4 percent.
In summary, you are paying roughly the same price today for a home as you did one year ago, but your getting a very slightly smaller home for the price.
CHEK news had a short report on the drop in Victoria houses prices YOY. The message is getting out there.
Global news reports that prices are down 7% YOY in Vancouver. Talking head agent said lots to choose from, it's a buyers market and you can negotiate. Duh
CHEK headline before 6 PM said
"Real Trouble", kinda sums it up.
Hey Rodger... I didn't take a good look at your links this month but what I really liked was the PDF's that were put up on HHV's blog last September.
I hand those around the office to all the sheeple : )
http://househuntvictoria.blogspot.com/2008/09/are-victoria-prices-falling.html
I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
Betty
http://www.my-foreclosures.info
Post a Comment