What a roller coaster!
2010 started out with a solid amount of momentum from late 2009. In fact, there seemed to be a lot of pent up buyer demand spilling over from 2009 and by May 2010, the numbers proved that sales volume had increased from the year before.
By June, the HST blunder of the century finally caught up with real estate (and other) sales. HST only applied to new developments which had already been hammered by the 2008 downturn so when the HST uncertainty was added, sales came to a screaming halt. We still see effects of this in low sales numbers for building lots, modest housing starts and sluggish sales at the new developments across town.
All is not doom and gloom however as when sales start to slow, prices decline and buyers move in. If you stop and take inventory of the current market. It's a great time to buy and a great time to sell for that matter. Why, interest rates are low and we have 5 year rates at 3.55%. The number of homes for sale under $400k is at an all time high and when you crunch these two statistics, it makes sense to stop paying rent if you can muster a 5% down payment. This will bring out the investors and first time home buyers proving that our market is stable and overall sales should improve moving forward.
Sellers need to drink a large glass of reality juice. Pricing is more important than ever. In July of 2010, I sent an email out to all my sellers telling them my "gut feeling" was that all prices needed to drop by 10% in order to snag a buyer. I boldly suggested that those who do not drop by at least 10% wouldn't sell at all. I was correct. And, I told them so. Moving forward, sellers have to let go of their perceived value based on sale prices increases from 2007. This means that most homes will sell if priced near their 2007 equivalent. For some, this is too much. At the sale time, this statistic applies to all housing so a sell and buy in the same market nets out proportionately. If you are moving up, you will probably get a better buy for less money (smaller spread) and if you are down sizing, you will be able to true reduce your mortgage although the spread may not be as favourable.
July thru November was truly an trying time for may Real Estate Agents. Sales volumes in most categories were so slow that less than 1 in 8 Realtors could claim a sale each month in the Central Okanagan. Considering that, our fixed costs are quite high in this profession, it is obvious that many Realtors took a step backwards. Many of us had our best years ever. At RE/MAX I have heard many other Realtors commenting on their best year ever. It was my best year ever and when I look back on the clients that I helped this year, I truly feel that I work with the very best people. Great people. Honourable people. All who negotiated in good faith and with knowledge and tact. I am very grateful to have such noble clients.
We had some great win-wins this year and I believe that all my clients made good choices. Congratulations to all who where able to move on to bigger and better things!
Based on my strong 2010, I believe that 2011 will again offer us a roller coaster. It may not be such a wild ride as 2010, but it will require a few gut checks along the way.
To my buyers and clients, who believe that 2011 is the year for them to make a choice to build wealth, let's chat earlier in the year. The good buys of the first quarter may be tougher to find later in the year.
To my sellers, I will be contacting each one of you personally and as always, I will bring the most accurate and insightful information to help you make the best choices for you this year.
This market is what it is. Those who ignore the media and focus on the fundamentals of buying and selling real estate will be the winners in this period.
It's a great time to Buy and Sell and I can help you choose. I can also help you make sense of this market place and help you on a path towards growth for any plans and goals you may have.
Best Regards Always,
Dean
No comments:
Post a Comment