Calgary Real Estate predictions?

[chemgear]

Originally Posted by Pinner

Exactly, people are so concerned how much their house is worth but it really makes no difference unless your getting into or out of the market.

Hmmm wouldn't a downward trend in prices have a larger effect if you're looking to move up to a larger more expensive house (in absolute dollars.) Though I guess that assumes everything is affected equally on a percentage basis . . .

While I agree with the sentiment, I think many people say that but don't actually think that house prices can actually come down. I know people pushed to the brink by houses they couldn't really afford in the first place. If prices go down and they get underwater (some of these out there already from 2007/8) . . . buying a new house is the least of their worries. Knowing that you couldn't even cover your debt obligation by selling the house can start a nasty little cascade of shenanigans. And nevermind the sidebar of people borrowing on house backed lines of credit based on disappearing equity.

Speaking of which, anybody ever find out what happens when you are (badly) underwater and your mortgage renewal comes up? I assume the current bank would still roll it over but you'd be hard pressed to find another bank to take the loan. You'd probably get screwed hard with a poor rate?

[photon]

Originally Posted by Tron_fdc

Kinda odd, but I took a quick look at rental rates yesterday and it seemed to me like they were really high? I own a 3BR house in Bankview (built in 2004) and it looked like I can rent the thing for almost 4k a month???? WTF, that's almost double what I pay in my mortgage.

I'm tempted to go buy another smaller house and rent out the one I'm in.

Just keep in mind that what you see listed is what people are ASKING for for rents, not what they're actually getting.. check again in a month and see if the same $4000/month homes are still for rent.

[cmyden]

Originally Posted by Tron_fdc

Kinda odd, but I took a quick look at rental rates yesterday and it seemed to me like they were really high? I own a 3BR house in Bankview (built in 2004) and it looked like I can rent the thing for almost 4k a month???? WTF, that's almost double what I pay in my mortgage.

I'm tempted to go buy another smaller house and rent out the one I'm in.

Rental rates for SFH have come back up slightly after the inventory drastically reduced (falling about 25-30%) in early 2010 (it appears that might be where a lot of this inventory on MLS is coming from).

Here's a look at the median price to rent a SFH in Calgary, using RentFaster.ca data...

Calgary SFH (median)
-----------
[2010]
05: $1650
04: $1600
03: $1600

[2009]
12: $1550
11: $1600
10: $1600
09: $1600
08: $1600
07: $1650

It's been fairly stable overall though.

and here's 2 bedroom apartments....


2 Bedroom Apt (median)
-------------
[2010]
05: $1098
04: $1095
03: $1095

[2009]
12 - $1099
11 - $1099
10 - $1100
09 - $1150
08 - $1150
07 - $1200

Personally I can't imagine how anyone could possibly see inner-city Calgary as a good rental investment, *unless* you were convinced that we're going to see the type of appreciation we saw over the past 6 years. The price to rent ratio for all of Calgary is sky high, but for the inner city it's downright ridiculous (300+). You can rent $500-$600k homes for $1600/month.

[Wookie]

Found this quote interesting from an article that I didn't find all that interesting.

According to the Calgary Real Estate Board, in 2000, there were only 12 properties reported as sold in Calgary for over one million dollars.
The latest figures by CREB indicate how far the luxury home market has increased in the past decade.
In April alone, 29 single-family homes in Calgary sold for more than one million dollars. There were no condominiums that sold at that price point.


Read more: http://www.calgaryherald.com/busines...#ixzz0nSC1NLvz

The article was more about CIR Realty growing rather than the quote.

Found it interesting. I don't really think it indicates the luxury home market has grown by the percentage the number indicates. As there's plenty of homes that sell (or did sell) for $1.0 million or more that aren't all that exciting or luxurious.

[chemgear]

This can't be a good thing:

http://www.financialpost.com/news-se...tml?id=3013137

We're worse than the Greeks AND the Americans? Seriously?

[Clarkey]

I went from 30 showings on my house in the first 3 weeks to maybe 3-5 in the last 3 weeks. I believe the market suddenly changed within that time period. I don't know if it's interest rates or general investment fear but there is definately something going on. My agent said that he has had no showings on any of his listings.

[Slava]

Originally Posted by Clarkey

I went from 30 showings on my house in the first 3 weeks to maybe 3-5 in the last 3 weeks. I believe the market suddenly changed within that time period. I don't know if it's interest rates or general investment fear but there is definately something going on. My agent said that he has had no showings on any of his listings.

3 weeks ago as in April 19th?

[Bill Bumface]

Originally Posted by chemgear

This can't be a good thing:

http://www.financialpost.com/news-se...tml?id=3013137

We're worse than the Greeks AND the Americans? Seriously?

Does the ~$40K per person count mortgage debt? Or is that just personal debt?

[Tron_fdc]

Originally Posted by Clarkey

I went from 30 showings on my house in the first 3 weeks to maybe 3-5 in the last 3 weeks. I believe the market suddenly changed within that time period. I don't know if it's interest rates or general investment fear but there is definately something going on. My agent said that he has had no showings on any of his listings.

I think it's fairly normal to go from a lot of showings the first few weeks to not many. I've heard of realtors cancelling and re-listing homes for that exact reason.

You might want to consider pulling your house for a few weeks, dropping the asking price and re-listing it.

[nik-]

Originally Posted by hulkrogan

Does the ~$40K per person count mortgage debt? Or is that just personal debt?

I'm way over that if mortgage debt is included

[mykalberta]

40K per person debt - other than the student loans that will be done in October, I am debt free (other than mortgage). I dont consider the mortgage a debt because my home is worth more than what I owe so if push comes to shove I would sell and come out ahead.

[1stLand]

There is alot of listings out there. Alot of inventory. Listings will typically get the most showings the first week they are put on the market.

Alot of the stuff that is moving are the starter homes.
But they are not moving at the same pace as last year around this time.

Definately, there is downward pressure on prices.

[chemgear]

Originally Posted by mykalberta

40K per person debt - other than the student loans that will be done in October, I am debt free (other than mortgage). I dont consider the mortgage a debt because my home is worth more than what I owe so if push comes to shove I would sell and come out ahead.

From what I can see: http://www.cbc.ca/money/story/2010/0...ce-vanier.html

I would guess that number is actually averaged per every man, woman, AND child.

And of course, the above quote blows up when prices are coming down and people can't sell. But hey, that can't happen with real estate - prices always/can only go up and you can't go wrong investing in real estate . . . like ever!

[macker]

http://en.wikipedia.org/wiki/Peter_Morici

This guy was on the Lang and O'leary exchange last night talking about the Canadian Housing bubble that he says has to burst. He said one morning we are going to wake up and feel very American. I guess then maybe our kids won't have to come up with $100,000 for a down payment then....those of us that will likely have to help our kids at some point are natuarlly hedged I guess. Interesting times with the EU and the 1 Trillion bailout.......all the meat is on the grill now......I read somewhere that Americans work 1/3 more vs Europeans if you include all the holidays etc. Maybe they better get back to work Not sure how it all effects real estate in Calgary but I am sure it does...

[Winsor_Pilates]

Originally Posted by Clarkey

I went from 30 showings on my house in the first 3 weeks to maybe 3-5 in the last 3 weeks. I believe the market suddenly changed within that time period. I don't know if it's interest rates or general investment fear but there is definately something going on. My agent said that he has had no showings on any of his listings.

It's partly just the reality of a listing getting older, but I think there's definite truth to things slowing down.
All of the new developments we are selling in BC got really slow all of the sudden about 2-3 weeks ago. Everyone sort of stopped looking for homes at the same time. I think fear or rates, fear of general investment and in our case fear of HST are all to blame.

[chemgear]

What is the ground level impression of the HST? Hear a bit about it in the news.

Is the fear about higher costs once it is in - would that help push sales in the short term until July 1?

(I think it's July 1st, but I could be wrong.)

[Clarkey]

I think I'm going to just yank my listing and re-list. We did have a few seriously interested and actually sold it conditionally a couple weeks in (but it fell through due to financing).

[Winsor_Pilates]

Originally Posted by chemgear

What is the ground level impression of the HST? Hear a bit about it in the news.

Is the fear about higher costs once it is in - would that help push sales in the short term until July 1?

(I think it's July 1st, but I could be wrong.)

I sell new developments which is where HST will apply. Most new condos/townhouses are sold pre-construction, so HST already applies with building completing after July 1; therefore there's no rush to buy now and beat the HST, its already too late.
The only developments that could see a push to buy before July 1 would be left over units at new developments which are move in ready. There's not a lot of this in greater Vancouver.

October 14, 2009 is actually the last chance to buy without HST effecting you, and I bought October 12th .

The fear is that we are jumping from 5% to 12%, but in reality most homes will be receiving a 5% rebate (homes under $525,000), so the hit is only 2% more. Homes above that price will be seeing more impact from the addition of HST as their rebate is capped at $26,250 (5% of 525K).

[cmyden]

http://edmontonhousingbust.com/2010/...peoples-money/

^ latest blog post from EHB discussing the CGA-Canada debt report

A couple of it’s more referred to points in the media is that on a per capita basis, each and every Canadian owes $41,740 in consumer debt (no province by province breakdown unfortunately). Consumer debt is debt that is not backed by assets, so does not include debt arising from things like mortgages. The other is that the debt-to-income ratio is sitting at 144.4%. Both those figures are all-time highs… which if that wasn’t bad enough, in case of the latter figure the report was obviously prepared before the most recent figures were released, it’s now at 146.2%.

If that wasn’t troubling enough, these figures have continued escalating even during the recession… behavior not normally observed. During the prior recession (‘90/’91) consumer credit contracted by -2.6%… this past year it’s not just expanded (+5.6%), but did so at a rate even greater than the historical average (+4.7%). Even mortgage debt, which while not expected to contract, still expanded by an above-average amount (+5.9%).

[Sylvanfan]

Okay...so how the hell does the average person owe $41,000 in debt on assets that aren't worth anything?

Seriously...there are a lot of people on this forum claims to be debt free and seemingly have a lot of assets. To have $41,000 grand in worthless consumer debt...thats a lot of booze, tobacco, gambling, or travelling. I probably rack up $600 a month on my credit card in purchases...but I also pay it off every month as I buy most of my essential stuff using the credit card. Would that mean I have $7200 a year in personal worthless debt? I just don't see how those numbers could be accurate. No way everyone owes what is basically the equivilent of a brand new Lexus in debt.