December 6, 2016

There’s Not This Crazy Deluge Of Offers Like Before

A report from CTV News Vancouver in Canada. “Data released Friday showed that those looking to buy a single family detached home in the city last month forked over about $1.5 million in Metro Vancouver, but recent listings suggest that the benchmark is falling. CTV News found a number of East Vancouver homes priced under then $1 million mark during a search of MLS listings on Monday, including one that sold for $560,000 below the initial asking price. Sutton West Coast realtor David Hutchinson has been tracking plunging prices and found several detached homes listed below $1 million, some of which had been recently renovated.”

“‘If you want to sell, you have to be priced sharply, and you see a lot of price drops,’ Hutchinson told CTV. And even with price drops, he added, he’s seen many sale prices lower than what sellers are asking for. He said he knew of one home in the west side of the city that was initially priced at $3.9 million, but when it didn’t sell, the owners reduced the price. They kept reducing it in small increments, but eventually they couldn’t wait any longer, and had to drop the price by nearly $1 million.”

“Another home on West 8th in Kitsilano was listed for $2.5 million, but could only fetch $1.6 million. ‘There’s not this crazy deluge of offers coming in like before, when you could price it below the market value and wait for all the offers to come in. That’s not happening anymore,’ Hutchinson said.”

From Estate Agent Today on the UK. “Transaction volumes across all of London are 48 per cent lower than they were a year ago, claims an estate agency - and in prime parts of the capital, transactions are 60 per cent down. London agency Portico says that in Westminster in April this year, after the deadline for investment buyers to beat the April 1 stamp duty deadline, volumes dropped to below 100 transactions in a month to a record low of 84. Transaction volume levels have remained ‘critically low’ since that time, the agency says. It claims prices are only just beginning to show annual drops - although other agents have reported falling prices for some time.”

“‘Unless action is taken to re-establish the natural movement of the whole market it’s likely this could be a serious issue and we will see prices fall’ warns the firm’s regional sales director Mark Lawrinson.”

The National on United Arab Emirates. “Rents have fallen by 9.4 per cent across Abu Dhabi’s residential investment areas since the start of the year according to new research. The decline outpaced a fall of about 5.2 per cent in the value of homes over the same period, according to a report from Cluttons. Sea view villas on Saadiyat Island had the greatest falls in value, with prices dropping by nearly 18 per cent over the first nine months of the year. Mid-range apartments on Reem Island had the second biggest falls in value with prices down by 11.1 per cent over the same period, Cluttons said.”

“High-end villas also recorded the biggest falls in rents. Cluttons said that rents for villas on Saadiyat Island fell by nearly 25 per cent between January and September and were expected to fall further in the fourth quarter. ‘We have seen a notable acceleration in the residential market correction as a result of increasing global economic uncertainty and the protracted oil and gas sector’s decline, building during Q3 and being further exacerbated as we wait to understand the full impact of Mr Trump’s election as president of the United States of America,’ said Faisal Durrani, the head of research for Cluttons.”

The New Strait Times on Malaysia. “The asking price for real estate is expected to drop further next year due to a more challenging market for property developers, according to findings by online property portal PropertyGuru Group. PropertyGuru Malaysia country manager Sheldon Fernandez said this would be evident in high-rise units where certain segments are facing oversupply. ‘With the completion of many new developments flooding the market next year, there is likely to be a drop in selling prices due to lack of demand, and some may be motivated to move their units quickly due to their lack of holding power,’ he said.”

The New Zealand Advisor. “Auckland house prices have stopped rising for the first time in seven years, according to new data from Barfoot and Thompson. ‘Signs the rate of price increase has been slowing have been there for some months but November’s sales data confirms that for the time being at least, Auckland prices have stopped rising,’ said Barfoot & Thompson managing director Peter Thompson. ‘Both the average sales price and the median price in November were down on those for October. What puts November’s lower prices into context is that November and December are traditionally when prices peak for the year, and this is the first time in eight years that November’s average and median sales prices have been below those for the previous October.’”

“‘The market is not over reacting to the changes occurring. Clearance rates under the hammer at auctions were 30 percent in November with another 20 percent being sold in the 24 hours following auction. Those sellers who were realistic and prepared to trim their reserve price achieved sales and buyers were confident in meeting near record prices,’ he said.”

The Warwick Daily News in Australia. “In a tell tale sign of Gladstone’s property market a million-dollar home in Kin Kora is selling for $750,000. Owners Brian Headley and Kirstene Staib dropped the price from $980,000 in a desperate attempt to find a buyer. For more than 12 months the couple has listed their five-bedroom home which was once the place their three children grew up. Mr Headley said he never expected it to be this hard to sell his home of six years, which he says is his pride and joy.”

“They have spent $200,000 on renovations including landscaping and roofing their deck. Mr Headley, former owner of Uncle Brian’s Used Cars, and his parnter Ms Staib are keen to retire and move to Thailand once they find a happy buyer for their home. He said they were serious about selling in October, dropping the price, after he closed his car yard business. As they reduced the price of the house by $550,000 and spent $200,000 on renovations, they have spent or reduced about $750,000.”

“‘We put it on the market 12 months ago for $1.3 million,’ Mr Headley said. ‘This is great value for someone. It’s hard to swallow when you’re losing so much … But it’s time for us to go, we can’t sit here and wait.’”

It Went From Very Hot To Very Cold All Of A Sudden

A report from the Wall Street Journal. “Home builders say they are fairly upbeat about housing conditions. The stock market suggests otherwise. A gauge of home-builder sentiment in recent months has hovered near its highest level in 11 years. But the housing recovery has sputtered in recent months following a strong start to 2016. And luxury builder Toll Brothers Inc. has felt the pain, with shares down about 9% this year. This comes after Toll cut its gross profit margin guidance in August, when it cited delays in delivering units for its New York luxury condo market. That is problematic for a company like Toll, which depends on the higher-end market more than competitors.”

“The company maintained over the summer that it hadn’t seen a change in buying appetite from foreign buyers. ‘In New York City, specifically Brooklyn and Manhattan, the market has been relatively flat,’ Toll chief Douglas Yearley said on an earnings call in August. ‘Given all the gloomy sentiment, this was acceptable.’”

The Alaska Dispatch News. “In the past year, departing oil company executives and employees have bumped up housing inventory in Anchorage, creating a state of stiffer competition among sellers. ‘Shell was the biggest player and had the biggest impact with the number of people that they moved out because they shut down their office here completely,’ said Bethany Stamper, a realtor at Coldwell Banker. ‘We went from very low inventory last year until that announcement was made. Then we saw prices going down and days on the market going up. That was because the amount of inventory available was up.’”

The West Fargo Pioneer in North Dakota. “The White House isn’t the only piece of real estate seeing changes after this year. A divisive election is affecting the Fargo-Moorhead housing market. Some may call it a ‘buyer’s market.’ After eight years in the Woodhaven neighborhood the family is soaking up some final memories in the house Mike Wolsky helped customize from scratch. They’ve already found a new home. In that process, they could be spending this Christmas paying two mortgages. ‘Really haven’t had a lot of interest so far,’ said Wolsky.”

“Now more than 45 days on the market, they’ve slashed the price by $20,000 and still not a single bite. The Wolsky’s aren’t alone after three especially robust years, realtors say the market is cooling down. ‘I’m not sure what’s going on with the Fargo market, but it went from being very hot to being very cold all of a sudden,’ said Wolsky.”

The Philadelphia Inquirer on New Jersey. “The neighborhood’s zombie has, at long last, made it through foreclosure and is on the market. A quick tour of the house, which was vacant for nearly 30 months, revealed few surprises. When water and electricity have been turned off for more than two years at a property, you always assume the worst. The good news is that the raccoon family living in the attic has moved. The bad news is that no one has yet dared to open the refrigerator in the kitchen, perhaps waiting until the Ghostbusters have a free moment.”

“The state’s number of zombie foreclosures is among the nation’s highest. The reason is simple: It now takes an average of 1,262 days for a foreclosure to make it through New Jersey’s congested legal system, the longest time in any state, according to Attom Data Solutions (formerly RealtyTrac). In September, for example, one in every 691 properties in New Jersey was in foreclosure, even as the national number was one in every 1,600 homes. In Atlantic City, the ratio was one in every 375 houses, Attom Data Solutions reported, a result of the decline of the casino industry and the effect it has had on other employment.”

“‘There is a tripling effect,’ said Patricia Hasson, president and executive director of Clarifi, the financial-counseling and education nonprofit, which has begun counseling troubled Atlantic City borrowers. ‘Casino employees lose jobs, they don’t go out to eat, restaurants lay off employees,’ she said.”

The Dow Jones Newswires on Texas. “Dallas Mayor Mike Rawlings filed a lawsuit to halt exits from the city’s police and fire pension fund following more than $500 million in withdrawals since early August. The retreat by the city’s police officers and firefighters is heightening the risk that a major U.S. pension could run out of money. Pension officials say the fund could be insolvent in 10 years.”

“Officers say they are pulling their money because of concerns about the financial standing of the Dallas Police and Fire Pension Fund following a series of investment blunders that produced more than half a billion dollars in losses. The fund made an ill-fated foray into real estate that included luxury homes and shopping centers in Hawaii, student housing in Texas and raw land in Idaho and Colorado.”