Morgan: Key market sale factors are price vs. patience
With the economy slowly clawing its way out from under Canada’s drastic setback of 2008, sellers are now asking themselves: “Why hasn’t my place sold yet?”
Last month’s Okanagan Mainline Real Estate Board’s stats revealed there were 1,775 single family residential homes on the market, but only 205 single family homes sold.
The condo situation is no better, that market having become quite saturated.
There were 977 condominiums on the market last month and a mere 79 sold.
However, sales are up overall some 8.6 per cent from 2011 in the Central Okanagan.
But still, it leaves sellers to wonder, with the 11 per cent of single family homes and eight per cent of condominiums sold, why wasn’t their property one of them?
The answer is quite simple—it’s either price or patience. You can either be at the front of the line with price point or just become patient and wait for the right buyer to walk through your door.
In 2011, David Madani, an economist with Capital Economics, predicted a drastic 25 per cent drop in housing prices across Canada.
This turned out to be a false prediction that spooked the country into believing that there could be another recession. But again on July 25, Madani reiterated his prediction once again.
The Canadian Real Estate Association has recently updated its forecast for 2012, with a prediction that British Columbia will have a slight slowdown to reflect a decrease in sale prices by 3.4 per cent.
However, CREA said national resale housing activity should be around 458,800 units in 2012, representing an annual increase of 0.3 per cent compared to 457,305 sales in 2011.
So once again you can see the contrasting predictions among the economists.
With interest rates remaining at an all-time low, this might help to offset the real estate economy’s outcome and push it into a more positive light.
“Interest rates aren’t going to be low forever, but they’re not going anywhere fast,” said Gregory Klump, CREA’s chief economist.
Amidst all the negative reports, the Interior is seeing a slight continued growth in sales, but sellers will still have to ponder what the deciding factor will be when it comes to selling their property. Will it be price or will it be patience?