Island Off-Topic "Must you always talk about cars?" Not in here.
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10-02-2008, 10:30 PM
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#26 | | Need my Daily Fix of RS
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As far as housing goes, I really doubt prices will come down much in Victoria. On average, across the United States with all the foreclosures, financial crisis etc. housing prices are down only 16%. Considering Canada is in a much better situtation, and Victoria is a niche market, I wouldn't except more than a 5% price drop in the worse case scenario.
I just finished a new house, I contracted out all the work, my total expenses came out to $530,000. If I sold the house and paid real estate comission and GST my profit would be like $20,000. My point is if prices drop even 5%, builders will stop building, inventory will go down.....people will continue to retire to Victoria etc..
Last edited by Croatian7; 10-02-2008 at 10:32 PM.
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10-03-2008, 12:04 AM
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#27 | | To me, there is the Internet and there is RS
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Originally Posted by RZ350  You still have to pay. In the US if a bank goes down the only entity that doesn't have to cough-up is the bank itself. In Canada if a bank fails our money is insured, Canadian banks are quickly becoming some of the best in the world because of this.
Cheers,
Grant | Banks in the US are also insured by the fdic.
From there site:
Federal deposit insurance protects the first $100000 of deposits that are payable in the United States. http://www.fdic.gov/
Both Obama and McCain want to change that to 250000.
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10-03-2008, 07:37 AM
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#28 | | I bringith the lowerballerith
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Most banks carry additional insurance on top of CDIC/FDIC, which just cover the deposit group of products. IIRC, most of the trust and securities divisions (Wood Gundy, RBC Dominion etc.) are required to have additional insurance policies in place.
I'm still fairly comfortable investing regularly in aggressive growth/income funds, and don't think I would consider pulling any of my US investments from my portfolio. Any way you look at it, they still comprise of a massive portion of the world market, and pulling them only limits your portfolio diversification.
The commercial-backed paper fiasco will continue to hurt the Canadian banks until whenever it all gets sorted out, and we'll still probably see a lot more of an overall downturn... but the market will correct.
I'm personally not concerned about losing too much (mostly because I don't have a lot invested), but i'll keep my regular investments going the same way they have been. I put a plan in place to reach a long-term goal, and just have to ride out this short-term problem. Don't plan on touching any of that money for the next 20 years, so I try not to be too concerned with the short-term.
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10-03-2008, 03:08 PM
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#29 | | What hasn't Killed me, has made me more tolerant of RS!
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Originally Posted by Croatian7 As far as housing goes, I really doubt prices will come down much in Victoria. On average, across the United States with all the foreclosures, financial crisis etc. housing prices are down only 16%. Considering Canada is in a much better situtation, and Victoria is a niche market, I wouldn't except more than a 5% price drop in the worse case scenario. | Well... The median house price has dropped for 5 months in a row, and passed the 5% mark in June. Houses are now worth about 10% less than they were in April.
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10-03-2008, 03:46 PM
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#30 | | Guest | | |
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10-03-2008, 03:50 PM
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#31 | | I subscribe to the Fight Club ONLY
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Originally Posted by fenge Well... The median house price has dropped for 5 months in a row, and passed the 5% mark in June. Houses are now worth about 10% less than they were in April. | good to see someone with a realistic viewpoint instead of listening to the victoria real estate board or the times colonist... people though vancouver was a niche market too, and that the prices would keep going up until well after the olympics, but vancouver prices are dropping faster than florida prices were...
for people looking to buy, this blog keeps track of the latest real estate stats: http://househuntvictoria.blogspot.com/
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10-03-2008, 05:02 PM
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#32 | | Need my Daily Fix of RS
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Originally Posted by fenge Well... The median house price has dropped for 5 months in a row, and passed the 5% mark in June. Houses are now worth about 10% less than they were in April. | Looking at the peak isn't really the way to go. For example if I stock goes from $100 a share to $200 and falls to $190 in one year is it really down 5%? Sure, numbers wise it is. Also numbers can be misleading: average Condo price increased 6% last month which sounds very impressive if you ignor the fact they only sold 110 units. The Condo market is obviously struggling and more prone to burst than housing, but prices are the highest they have ever been, how do you explain that?
I invested with a friend in a detached duplex in Langford. Two identical houses. We sold one in April for $439,900 and just sold the second one for $467,500. First one took 10 days to sell, this one took 63 days to sell. Has the market slowed? Yes, have prices fell that much, not really.
I think from where we are right now (correction off the peak), I don't think housing prices will come down more than 5%. If prices come down 5% from where we are I can't see ANYONE building anymore. Anyone who is in construction knows how expensive everything is. Secondly, if I can't sell my new house for what I want I will rent it out (extremly low vacancy rate) or move in.
No new buildings + people pulling houses of market = decreased inventory.
Last edited by Croatian7; 10-03-2008 at 05:16 PM.
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10-03-2008, 05:46 PM
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#33 | | To me, there is the Internet and there is RS
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In Nanaimo if you drive down any street you will see at least 3 or 4 houses for sale because nothing is moving. Last December you could not find a single water front house for under a million. Now there are a number of them. One just sold for $780000.
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Last edited by Manic!; 10-03-2008 at 05:47 PM.
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10-03-2008, 06:54 PM
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#34 | | What hasn't Killed me, has made me more tolerant of RS!
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Originally Posted by Croatian7 Looking at the peak isn't really the way to go. For example if I stock goes from $100 a share to $200 and falls to $190 in one year is it really down 5%? Sure, numbers wise it is. Also numbers can be misleading: average Condo price increased 6% last month which sounds very impressive if you ignor the fact they only sold 110 units. The Condo market is obviously struggling and more prone to burst than housing, but prices are the highest they have ever been, how do you explain that? | Yeah, average pricing can be misleading. Sell a few million dollar condos and it pulls the average way up. The median is a more reliable figure to use, much less susceptible to big swings. BTW the median condo price is down 4.6% compared to last Sept. The average is down 7%. Quote:
Originally Posted by Croatian7 I invested with a friend in a detached duplex in Langford. Two identical houses. We sold one in April for $439,900 and just sold the second one for $467,500. First one took 10 days to sell, this one took 63 days to sell. Has the market slowed? Yes, have prices fell that much, not really.
I think from where we are right now (correction off the peak), I don't think housing prices will come down more than 5%. If prices come down 5% from where we are I can't see ANYONE building anymore. Anyone who is in construction knows how expensive everything is. Secondly, if I can't sell my new house for what I want I will rent it out (extremly low vacancy rate) or move in.
No new buildings + people pulling houses of market = decreased inventory. | I work in the industry as a mechanical consultant. Residential construction has ground to a halt this summer, there are no new jobs are coming in. Building your house is about to get a lot cheaper.
The selling price of an average house in Victoria is dropping by around 10g's per month. That's on par with the worst cities in the USA. That is unsettling to a first time buyer. If I had bought earlier this summer like I was planning, my down payment would have been wiped out in a few months and I would now owe more on my mortgage that the house was worth.
Four different couples I know that were looking at buying this year have decided to put it off until the market shows some sign of leveling off. The thing with the end of housing booms is that no one HAS to own a house. But many people HAVE to sell.
I hope there's no meltdown, but I'm not holding my breath.
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10-03-2008, 10:01 PM
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#35 | | Need my Daily Fix of RS
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Originally Posted by fenge Yeah, average pricing can be misleading. Sell a few million dollar condos and it pulls the average way up. The median is a more reliable figure to use, much less susceptible to big swings. BTW the median condo price is down 4.6% compared to last Sept. The average is down 7%.
I work in the industry as a mechanical consultant. Residential construction has ground to a halt this summer, there are no new jobs are coming in. Building your house is about to get a lot cheaper.
The selling price of an average house in Victoria is dropping by around 10g's per month. That's on par with the worst cities in the USA. That is unsettling to a first time buyer. If I had bought earlier this summer like I was planning, my down payment would have been wiped out in a few months and I would now owe more on my mortgage that the house was worth.
Four different couples I know that were looking at buying this year have decided to put it off until the market shows some sign of leveling off. The thing with the end of housing booms is that no one HAS to own a house. But many people HAVE to sell.
I hope there's no meltdown, but I'm not holding my breath. | Last September the 6 month average was $318,000. This September the 6 month average is $318,000. The occasional month thats $343,000 or $302,000 is most likely skewed by million dollar condo sales.
If prices fall, construction is likely to stop as opposed to get cheaper. First of all lots won't get cheaper because municipalities where the developments are (like Langford) are pinning all the infrastructure upon the developer. They want the developer to build the road ($$), pull the sewer connection ($$), pull the electricity etc. This is extremely expensive, goodluck on getting a lot under $200,000! Labour might get slighty cheaper but it's $120 to fill up a truck these days, not $60. Rent has increased in Victoria. Peoples morgages have increased. I can't see a trades person who charges $35/hour right now working for $20, they might as well go on unemployement.
As far as this comment that residental construction has ground to a hault, I don't know about that. I am helping my old man on the weekends do siding on his house on Bear Mountain. He called 11 businesses, only one gave an estimate that was ridicolous. I've seen a bit of a slowdown in drywalling and roofing, but other than that everyone is still pretty much working full tilt. Getting a reputable trades person is still very difficult.
Last edited by Croatian7; 10-03-2008 at 10:01 PM.
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10-04-2008, 06:17 AM
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#36 | | I answer every Emotion with an emoticon
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Originally Posted by Croatian7 First of all lots won't get cheaper because municipalities where the developments are (like Langford) are pinning all the infrastructure upon the developer. They want the developer to build the road ($$), pull the sewer connection ($$), pull the electricity etc. | You can pull sewer out of that equation in a lot of places. I know for a fact in Langford, if there's a sewer connection going down an existing road just to service a new condo building, they tag a service fee onto the yearly taxes of all the existing residences - whether they connect to it or not! It's fucking lunacy. My boss is payed an extra $400 last year, and it's "gone down" to $385 for the sewer that went down his road to the new condo unit behind his house.
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10-04-2008, 06:46 AM
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#37 | | Need my Daily Fix of RS
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Originally Posted by Black SC2 You can pull sewer out of that equation in a lot of places. I know for a fact in Langford, if there's a sewer connection going down an existing road just to service a new condo building, they tag a service fee onto the yearly taxes of all the existing residences - whether they connect to it or not! It's fucking lunacy. My boss is payed an extra $400 last year, and it's "gone down" to $385 for the sewer that went down his road to the new condo unit behind his house. | Sewer connection going down the existing road isn't a big deal (especially if you are just hooking up one house); however, lets say you want to buy a 10,000 sq/ft lot directly behind the Reflections building and subdivide into two lots. Virtually downtown Langford. You would think downtown Langford would have a sewer connection down every street. Not so the case, for example, Winster Road behind Reflections has no sewer connection down half the street. Langford was suppose to install it three years ago but eventually said: "Fuk it, if someone wants to tear these old houses down and put up new ones, make them pay for the sewer to be pulled off the main street". Therefore if you want a sewer connection you might have to pull it at your expense anywhere between 100-1000 feet. Considering this involves tearing up the road, engineering plans etc...very expensive.
Totally getting off topic but basically overall I don't think we are screwed as the media may suggest. Secondly, if buying a house, I would wait. Are house prices going to drop that much (in Victoria), I don't think so: Canadian economy still good, niche market, vacancy rate very low, construction extremely expensive.
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10-04-2008, 06:52 AM
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#38 | | Proud to be called a RS Regular!
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everyone wants to live in bc right..
but with all he homes for sale i wonder how much of them are hose people that just bought and sold when the market was hot (kinda like curbers/flippers)..
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10-04-2008, 07:28 AM
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#39 | | Revscene.net has a homepage?!
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Speaking as the Son and Grandson of master carpenters. Generally when the times are good and lots of building is going on anyone with a pick-up truck and a few tools decides they can be a contractor. They don't make quite as much money as the more legitimate journeymen do and the work is nowhere near as good but they are still working and making good cash.
When there is a recession (and make no mistake, there is going to be) they generally end-up going back to the jobs they had before (pumping gas, etc.) and good ridence as well.
The true craftsmen who have the training and experience to do an amazing job will usually be able to find work. The pay will be worse but there will always be a little work.
The moral: When things are booming save your bucks once the boom is over you can get better work for less money.
As to the housing market: The low vacancy rates are not going to last for long, I'm seeing a lot of signs for tenants. It's a self-fuelled market and all it takes is a fairly major reduction in contracting work to see Victoria enter a housing slump. Sure we have a large population with secure income, but they aren't the ones selling and driving the price. It's only going to take a small percentage who overextended themselves with a zero down mortgage and decide to forclose when they loose their job to really affect prices.
The way to weather this bit of an economic downturn is to hold onto a steady, non-market driven job and accept a slightly lower standard of living. If you do this and manage to put some money away in a VERY secure place you will come out the other side in much better state then those who refuse to see what is coming before it's already affected them.
IMHO,
Grant
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10-04-2008, 08:17 AM
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#40 | | RS Veteran
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Some good points in this thread. I agree with this "The way to weather this bit of an economic downturn is to hold onto a steady, non-market driven job and accept a slightly lower standard of living." This is what a lot of Americans are doing as well. A poll was released yesterday which overwhelming shows that Canadians will put off spending on big ticket items, vacations, gifts, eating out etc. This helps you weather the storm but hurts the economy when spending drys up.
I wanted to comment on the condo market. IMO there will be a short term correction because pricing is inflated. Long term I see condos as a good investment. They are an affordable choice for first time buyers. Especially with the new rules that demand 35 yrs and 5% down. Secondly a huge portion of our population is gearing up for retirement. Many at my job talk about downsizing to a condo or townhouse and using the equity to enjoy their retirement years.
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10-04-2008, 08:26 AM
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#41 | | Even when im right, revscene.net is still right!
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You need to remember, how much of the Economy is psychological. If people are worried, they don't spend money and the economy goes down.
So far its just been condos taking a shit kicking... looking at comparables of my house, the market seems even compared to March when we bought... the only difference is there is a lot more supply (we looked at two houses in Sooke, theres about a dozen now that meet our criteria). I just signed a new two year contract at work so I'm not exactly worried about moving away.
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10-04-2008, 09:44 AM
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#42 | | What hasn't Killed me, has made me more tolerant of RS!
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I think if anything, the media paints a rosy picture of the housing market. Especially when so much newspaper advertising is condo presales or whatever.
I have no doubt it's still hard to hire a guy to do siding on your house, but the larger commercial contractors I work with are all looking to pick up more work. 6 months ago you would get maybe one bid from a mechanical or controls guy. Now GCs tell me they get 3 or 4. It is definitely getting tighter out there.
Labour will get cheaper, lots will get cheaper (prices are going down, remember?) Building materials will get cheaper. We're at the end of a massive, worldwide housing boom. We've been building more houses than we need for a few years now, all across Canada. The reason you can't make money building houses anymore is because you have to compete with the thousands of houses for sale right now. Lots of supply, little demand. If building costs can go up by 20% a year, trust me, they can come down by that amount. Ask any career carpenter how easy it was to make a living in 1997. Quote: |
Originally Posted by AME_VIP I wanted to comment on the condo market. IMO there will be a short term correction because pricing is inflated. Long term I see condos as a good investment. They are an affordable choice for first time buyers. Especially with the new rules that demand 35 yrs and 5% down. Secondly a huge portion of our population is gearing up for retirement. Many at my job talk about downsizing to a condo or townhouse and using the equity to enjoy their retirement years. | But who's going to buy the $700k house that they are downsizing from, if the average first time buyer can only afford $250k or so.
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10-06-2008, 09:05 AM
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#43 | | Guest |
Wow, that 700 billion bailout didn't do anything. Markets are crashing everywhere, and now Canadian economists are saying big recession in Canada until 2010.
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10-06-2008, 02:38 PM
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#44 | | Revscene.net has a homepage?!
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Originally Posted by dustinb Wow, that 700 billion bailout didn't do anything. Markets are crashing everywhere, and now Canadian economists are saying big recession in Canada until 2010. | Good. I have been looking forward to that announcement for months.
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10-06-2008, 04:17 PM
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#45 | | B&S Sexy mod
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i hope the housing market can take a bit of a dump, as well as the american dollar, then i can get my motorcycle and go halfers on a house with my bro  | |
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10-06-2008, 04:51 PM
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#46 | | I subscribe to the Fight Club ONLY
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jebus, can't believe the drop today... if anyone has money to invest, start watching...
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10-06-2008, 06:36 PM
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#47 | | Need my Daily Fix of RS
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Originally Posted by stevo911_ i hope the housing market can take a bit of a dump, as well as the american dollar, then i can get my motorcycle and go halfers on a house with my bro | Ughhh????? You do realize that the Canadian dollar is commodity reflected? Therefore the odds of a housing "dump" and a strong Canadian dollar compared to the American dollar is virtually zero.
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10-06-2008, 08:31 PM
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#48 | | B&S Sexy mod
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i know, but it would be damn nice, i'd take either of the two gladly though
Last edited by stevo911_; 10-06-2008 at 08:33 PM.
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10-06-2008, 11:14 PM
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#49 | | I *heart* Revscene.net very Muchie
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Originally Posted by dustinb Wow, that 700 billion bailout didn't do anything. Markets are crashing everywhere, and now Canadian economists are saying big recession in Canada until 2010. | Not that it is a great plan anyway, but lets be realistic - you think a piece of legislation signed on a Friday is going to have any discernible effect come Monday? It will take time for the credit markets to unclench and for the money to start flowing. Today's slides would have happened regardless of whether this plan is amazing or not. Everything takes time. No one said that the bailout would stop massive selloffs, but hopefully it can assist in getting shit back on track sooner.
This whole topic is so painful to listen to on the radio or see on the internet. On one hand you have people blaming Harper, on the other people are blaming the war in Iraq and Afghanistan for stretching our economy... it goes on and on. People act like the market has never corrected itself before. Economies are not perpetual motion machines that continue to grow. Gotta pay the piper now and then.
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10-07-2008, 12:04 PM
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#50 | | What hasn't Killed me, has made me more tolerant of RS!
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| TD to raise rates on mortgages
I guess the other banks will be following pretty quickly.
On an unrelated note, who else thinks we're going to see a canadian bank go under this week?
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