February 5, 2015

A Desperate Bid To Appeal To Nervous Buyers

MetroNews reports from Canada. “January’s bitter cold doesn’t appear to have a taken a bite out of the GTA housing market, with the Toronto Real Estate Board reporting ‘a strong start to 2015′ in sales figures for the first month of the year. Sales, prices and even new listings were all up significantly. New listings were up 9.5 per cent, although active listings – the combination of new and previous listings still unsold – were still down 2.5 per cent year over year, which means the market remains tight. ‘The fact that new listings grew at a faster pace than sales suggests that it has become easier for some people to find a home that meets their needs,’ said TREB president Paul Etherington.”

“But some housing watchers will inevitably take a different view, suggesting that the growth in listings – especially after so many years post-recession in which folks opted to just stay put – may be a reflection that some homeowners are concerned the market has hit its peak, consumer confidence is waning, and sales may be headed for a slowdown, despite TREB’s optimistic predictions for 2015.”

The Edmonton Journal. “Residential real estate sales in Edmonton slumped nearly 26 per cent in January compared to the same month in 2014, the Realtors Association of Edmonton reported. The 666 residential properties that changed hands marked the lowest number of January sales in the past five years. In 2013, January saw 915 Edmonton sales. Also last month, new listings increased 29.5 per cent to 2,316 — the highest number of new January listings in five years. The sales-to-listing ratio for the month was 29 per cent, indicating a buyer’s market.”

“Association president Geneva Tetreault said she doesn’t draw a link between January’s spike in new listings and sellers who are worried about oil prices and Alberta’s economy. ‘These are people that planned on listing in the new year anyway,’ said Tetreault, owner-broker of Century 21 Vantage Realty in Edmonton’s west end. ‘I haven’t had any calls in my circle of people panicking and saying, ‘Oh my God, I need to sell my house right away.’”

From Global News. “A whopping 2,316 new listings were added to MLS for the Edmonton area in January, compared to 932 new listings added in December. ‘My sellers are trying to beat the market,’ said real estate agent Jay Herrick. ‘They’re trying to get on before the uncertainty really unfolds… Nobody’s panicking yet.’”

From CBC News. “Calgary’s housing market slowed way down in January. Here’s the strangest number in the report: new listings jumped by 37 per cent, which begs the question, what are people thinking? That NOW is the time to sell? ‘It’s the fear of missing out,’ says Don Campbell, a real estate analyst and co-founder of the Real Estate Investment Network.”

Business News Network. “Since listing her condo townhouse at about $340,000 three weeks ago, Calgary entrepreneur Susan Benoit has received only a handful of phone calls from interested buyers and just a single viewing. She purchased the unit six years ago, shortly before the market crash brought on by the financial crisis, which instantly wiped more than $100,000 off the assessed value of the home. It’s taken this long for home prices to rebound to a point where Ms. Benoit hopes to break even on selling the property, which she began renting out after she got married.”

“‘I probably should be more worried because I have a rental property I’m trying to sell,’ she said. ‘Right now I’m not worried. Maybe that’s naive or wishful thinking, but so many people say even though oil and gas is going down, [home] prices are still going up.’”

The Globe & Mail. “The calls started coming into Thomas Keeper’s Calgary real estate office a week before Christmas. Oil executives, watching their company stocks plummet in the wake of plunging crude prices, were looking to sell their multimillion-dollar homes ahead of the new year, hoping to cash in before the panic reached the city’s housing market. The city’s luxury market is already in the midst of meltdown, with some sellers slashing their prices by hundreds of thousands of dollars in a desperate bid to appeal to nervous buyers.”

“Nearly half of the luxury properties in Calgary’s most prestigious neighbourhood, Mount Royal, have dropped their prices by $100,000 or more, with many homes that were selling well above $1-million now languishing on the market in the six figures. Nearly a third of all new listings above $1-million in the city are for brand new, builder-owned attached houses on infill lots, said Colin Kehler of Re/Max. Several are from small developers who had torn down older single-family homes to build high-end attached houses. Many are now sitting empty in a cooling market. ‘You’d have to think they can’t carry them for too long,’ Mr. Kehler said. ‘I think there’s going to be some motivated sellers.’”

“After pouring thousands into granite countertops, hardwood floors and new appliances, Sandra MacKenzie listed her 102-year-old house on a corner lot in Mount Royal for $1.4-million in November. But after weeks with little interest from buyers, Ms. MacKenzie recently slashed the price to $900,000. An open house last weekend brought 30 people, but no takers. ‘I just can’t go any lower than that, but everybody is so scared to buy now because of the oil prices,’ said Ms. MacKenzie, whose parents had taken out a reverse mortgage on the property, leaving her little equity amid falling prices. ‘I would even sell to a builder at this point. I hate saying that because it’s a beautiful home, but I’m getting desperate.’”

Bits Bucket for February 5, 2015

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