Quote:
Originally Posted by Burninator
Claeren I know you had mentioned earlier that you were hoping to snag a downtown condo from an owner who was desperate to sell. And from the sounds of things such a situation could arise. Even developers could start cutting their prices (instead of offering these lame incentives and loans). What sort of time line are you expecting? I ask because I am also hoping to buy a condo (preferable inner city) near the end of this year or early 2009 (or whenever the market is prime to do so). Also where do you guys follow all of this? I get most of my news here.
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That is the question these days isn't it.
I think within the next 4 months, starting right now, there will be bargains to be had as those willing to cut their losses will do so to whomever happens to give them a decent offer.
So if you see something you like i would go take a look and give them an offer - it can't hurt?
However I think a lot of people are hesistant to publically price their property too low. Who wants to the guy to do it first? So i think properties seemingly over-priced could sometimes be had for a lot less with a good offer. Just where is the line between a good offer based on declining speculative pricing and an insulting offer based on opportunisim?
But i definitely think certain segments will be hit far harder then others. Condo's more than homes, suburban more than inner-city, etc.
A well built home in a good community not on the furthest edge of the city will hold its value (maybe not relative to inflation, but...) but a poorly built suburban home or condo in a less desirable new community on the furthest edges of the city will take a huge hit. Suburban condos are already falling well off of their highs. 1 bedrooms i saw priced at $285k+ last summer (like RedHaus) are now at $220k-$235k (with thousands coming onto the market rom amateur-speculators this year) and small 2 bedrooms that were peaking in the $330k-$365k range are now in the $265k-$285k range. And those prices still seem high relative to rents (which are falling as fast as prices which is a bad sign).
Downtown luxury units might take the biggest hit, but the problem there is that a $600k unit might drop in true value to $400k, but most would not sell unless they really had to and $400k is still a lot of money. But there are thousands of those units coming to market too, and just one look at Arriva shows how well they are selling.
I am NOT trying to make it sound all doom and gloom. There will be opportunities for buyers finally, and some sellers/speculators who were not careful will take a hit. But as long as the job market stays healthy we in Alberta should have a soft landing.
And in a soft landing scenario, it just means there is finally no rush to buy and that you can seek out a good value. If you are experiencing income growth and have a workable and affordable living arrangement then i would just keep saving up with an eye on what is out there. I am thinking next summer for myself, when the 10,000 units under construction hit the market - but with single family housing falling further i might go that route sooner (as it will recover faster then condos). I do think i will save ~10% just in inflation by waiting 'til next year, and even more once i factor in that I am earning more then inflation on my savings (as long as that doesn't change).
(And virtually all of my posts are comparing people like my peers, who have all come of age during this boom and who have had to make very real decisions about buying v. selling not 5 years ago, but now and over the past ~2 years. If you bought before that because you are a few years ahead, then good for you - you are in a win-win situation. Either way you can use equity in your house to buy other houses/investments, etc. But for the rest of us, the decision is not so simple. Unless ready to buy at 20 while in university, our only choice was mid-boom or post-boom (without knowing where one starts and the other begins). No pre-boom choice available.)
Claeren.