January 3, 2017

A Tough Year For Sellers

A report from the Calgary Herald in Canada. “Like many ends of the Calgary area residential market, the home ownership program through Attainable Homes Calgary Corp. recorded a dip in activity in 2016. The program offers homes for down payment of $2,000. Applicants must qualify for a mortgage and not earn more than $80,000 annually. People with dependent children can earn up to $90,000. Attainable purchases housing inventory at reduced prices from builders interested in giving back to middle-income Calgarians. There were 92 sales between Jan. 1 and Dec. 19 this year, down from 155 during the same period in 2015. Possessions eased to 96 from 208.”

“‘I’d say it’s the economy,’ says John Harrop, Attainable’s CEO. ‘I think, fundamentally, consumer confidence is down, so people are taking longer to make home ownership decisions.’ Moreover, vacancies in the city are up and rents are down, he adds. ‘On top of that, although it only affected the last quarter, the new mortgage rules have significantly made it harder for our purchasers to buy,’ Harrop says. ‘It affects their buying power by about 20 per cent.’”

The Aberdeen Journal in the UK. “Aberdeen is the biggest faller in a leading lender’s review of UK house prices in 2016. Aberdeen’s average house prices are down by 6.9% on a year ago, at £203,425, according to Halifax. The city’s weaker market was highlighted by Church of Scotland officials recently knocking thousands of pounds off the asking price of a mansion in Rubislaw Den South that was expected to become Scotland’s first £1million-plus manse.”

“Bob Fraser, senior property partner at Aberdeen-based law firm Aberdein Considine, said the figures reflected a ‘tough year’ for sellers in the north-east. ‘As with any market, 2016 has been about supply and demand,’ Mr Fraser said, adding: ‘There is a lot of supply because a number of people leaving the area because of work commitments elsewhere. As a result, demand has been suffering.’”

The Gold Coast Bulletin in Australia. “The first cracks leading to the collapse of Wayne Cullen’s building company which threatens to wipe out some Gold Coast subbies began appearing on Brisbane sites 12 months ago. As liquidators begin the voluntary winding up of Cullen Group Australia, subbies working on a $100 million Boheme development just south of the Robina Town Centre want to know what went wrong. Some of the 300 subbies estimate they are owed up to $130,000, others predict millions of dollars will be lost, comparing the financial crash to the Titan’s Centre of Excellence dispute which left construction players bankrupt.”

“‘This hasn’t happened overnight,’ An industry insider close to the company said. ‘The only reason they haven’t been held to task is developers (on other sites) haven’t wanted anyone to say anything.’”

The New York Times. “Aruba, one of the few Caribbean islands generally considered outside the hurricane belt, has struggled to recover from the global real estate crisis of 2008, when home prices fell anywhere from 15 percent to 40 percent, though there have been some gains in recent years, agents said. ‘The market was doing very well until this year,’ said Garrick Hasham, an agent with Aruba Sotheby’s International Realty. ‘The real estate market has slowed down in 2016, and we’ve noticed it at all the real estate offices on the islands,’ which also include nearby Bonaire and Curaçao.”

“Compounding problems have been an ongoing recession in neighboring Venezuela; a loss of value in the Canadian dollar; and the recent presidential election in the United States, which has prompted potential home buyers to hesitate, agents said. Those three countries supply the bulk of foreign home buyers in Aruba, they said. Aruba is ‘very much a buyers’ market now,’ said Walter Zephirin of Seventh Heaven Properties. The average price per square foot in Aruba is roughly half that of luxury destinations such as Anguilla or Turks and Caicos, he said.”