Calgary Real Estate predictions?

[81flames]

I'm in the same situation and my realtor told me to wait until the new year. He says that about 9000 new condos are going to be coming on to the market and a bunch of those are going to be put up for sale.
Think of it this way, all those new developments still need to be built regardless of whether there is a buyer or not. New develpoments are not selling very well right now and new home builds have basically stopped. There is no reason for a developer to hold onto those properties once they are done, so they will be trying to unload them. I would wait until the new year and in the meantime, save up.

[burn_this_city]

Originally Posted by Claeren

Go back and re-read my posts in this thread -- I have been DEAD ON so far....


Prices are going to keep dropping.

Single Family Homes will bottom out before Condos.

Urban/Established Neighbourhoods will bottom out before Suburban Areas.

Faux Luxury Condos will drop further than well constructed and well priced condos without the faux luxury taglines (OMG GRANITE COUNTERS!? $400,000/500sq-ft IS CHEAP!).

Faux Luxury '$475,000-$650,000 McMansions' will drop a lot more than established older homes and/or entry level homes.


The loss of zero down and 40 year mortgages is going to take another 5%+ off prices.

Higher interest rates in 2009 and 2010 will take another 5%+ off pricing OR higher inflation will wipe away 5%-15%/year in home value.



So if you want a house you will have to be more on top of things but if you want a condo wait as long as you can? Maybe a year or more?

Of course your current living costs also come into play in terms of when you should buy.

Renters are making out REALLY well right now though. Landlords are not only subsidizing the rent by a thousand or more a month but are also losing thousands per month in lost home value.


Claeren

Radley, you, and I were the closest..

[troutman]

I've seen a rush of people trying to get in before the zero down mortgages are done.

Properties in my community are selling quickly again (2-3 weeks).

I think prime will go down one more time before it goes up again.

IIRC, Calgary homes are down 8% in value from the previous year?

[81flames]

Originally Posted by fotze

No they don't, the devloper can stop halfway through if they planned the project poorly. Notice how the gateway midtown (or whatever it is called) takes absolutely no responsibility of the project being halted on themselves. It was something completely out of their control, the construction costs, nothing to do with their timing or proce structure or sales.

You're correct fotze. I think the majority of projects (especially smaller ones) will still go up. I was looking in Panorama at some of the duplexes and townhouses there. The agent was pushing really hard at selling them, but they are not going to be completed for another few months. Some of them have already been framed. I think these smaller ones will be completed as the costs are not as crazy as a highrise. I actually wouldn't be surprised if more of those downtown highrise projects go under in the future.

[Tron_fdc]

Yeah, I'd wager a guess that prices are down by a minimum of 20%. I was going to sell my place downtown after I broke up with the g/f, but it actually makes more sense for me to pay her rent for 2 years than it does to take a $200k loss on the house. The house that cost $700k in my neighbourhood is now selling for $520.

The good news on all this is lakefront homes are now a lot more affordable. I found a few developments that were all spec homes, and prices are coming down by as much as 50% on them. Recreational property is taking a big hit right now.

I'm thinking it's going to be another 12 months of depressed values, and then a slow pick up. I doubt we're going to see the 30% increases over 6 months any time soon.

[Claeren]

Over 8% last month, likely over 9% down by now.

That is before, as i said before, looking at the fact you get more house for that comparable average price as well.


People trying to squeeze in on the 40 years are STUPID > OMG who is advising these people?

They will be INSTANTLY upside down on their mortgages?

In fact virtually anyone who bought last year with less than 5% down (about 70% of new buyers in Calgary last year sadly) are now upside down.

Yikes!

Lets hope the masses never find out or else people might start to panic....


(^ All of which is the very reason the government panicked and has eliminated these mortgage products. People are going to lose BIG.)


Claeren.

[burn_this_city]

Originally Posted by Tron_fdc

Yeah, I'd wager a guess that prices are down by a minimum of 20%. I was going to sell my place downtown after I broke up with the g/f, but it actually makes more sense for me to pay her rent for 2 years than it does to take a $200k loss on the house. The house that cost $700k in my neighbourhood is now selling for $520.

The good news on all this is lakefront homes are now a lot more affordable. I found a few developments that were all spec homes, and prices are coming down by as much as 50% on them. Recreational property is taking a big hit right now.

I'm thinking it's going to be another 12 months of depressed values, and then a slow pick up. I doubt we're going to see the 30% increases over 6 months any time soon.

The recreation market is great for buyers right now. Out in the Salmon Arm area there are a few good deals to be had. Very few properties have changed hands over the last year and some people are desperate.

[Tron_fdc]

Yeah, I saw a listing in the Okanagan that read "Insult me with any offer. Bring it on!!"

Of course, when I contacted the realtor she said I had to be in the $300 range (it was listed for $330). That's not insulting......insulting to me was coming in at $200, so I didn't bother.

The same development has furnished 2 b/r plus loft, 2 bath, double garage, semi lakefront (a block back) going for $350. I heard it was supposed to hit $500-600k this year (that's what was speculated 3 years ago) and people are desperate to move their investments.

[DementedReality]

so ... for a guy with a house in the NW, considered a slighly better than entry level type of house, with about 50% equity.

we want to upgrade ... sounds like a good time to buy, bad time to sell though.

advice on how to not get killed?

[Sylvanfan]

Originally Posted by Tron_fdc

Yeah, I saw a listing in the Okanagan that read "Insult me with any offer. Bring it on!!"

Of course, when I contacted the realtor she said I had to be in the $300 range (it was listed for $330). That's not insulting......insulting to me was coming in at $200, so I didn't bother.

The same development has furnished 2 b/r plus loft, 2 bath, double garage, semi lakefront (a block back) going for $350. I heard it was supposed to hit $500-600k this year (that's what was speculated 3 years ago) and people are desperate to move their investments.

There is going to be a huge over supply of Okanagan Lakefront type condo's here in the near future. Osoyoos where I live had a lot of places pre-sell like 80% of the development last year at high prices...and haven't sold a unit since. My boss has a townhouse he's trying to see and there haven't been any in that development sell since January. With the US dollar still low and the US housing market where it is, many investors have taken their money there...literally leaving no one left to invest here. I know right now the last thing I'd buy in Osoyoos....is a condo of any type. Saturated market thats about to get really cut throat.

[Sylvanfan]

Originally Posted by DementedReality

so ... for a guy with a house in the NW, considered a slighly better than entry level type of house, with about 50% equity.

we want to upgrade ... sounds like a good time to buy, bad time to sell though.

advice on how to not get killed?

Well you have to consider the absolute number of dollars it will cost you to make the upgrade. Generally in a down market you can move up assuming that percentage drops are consistant through all segments. Whereas in an appreciating market it makes sense to down grade and take your profits.

Figure out what the places you want to get into will cost, where they are now verses a set of time bench marks. Than compare your place or similar places using those same points in time. With that you should be able to see how the market for your house has changed verses the market for the upgraded places. Figure out the absolute cost difference at all your bench mark times...and that should help you determine where it's heading and if it's something to look at.

[DementedReality]

Originally Posted by Sylvanfan

Well you have to consider the absolute number of dollars it will cost you to make the upgrade. Generally in a down market you can move up assuming that percentage drops are consistant through all segments. Whereas in an appreciating market it makes sense to down grade and take your profits.

Figure out what the places you want to get into will cost, where they are now verses a set of time bench marks. Than compare your place or similar places using those same points in time. With that you should be able to see how the market for your house has changed verses the market for the upgraded places. Figure out the absolute cost difference at all your bench mark times...and that should help you determine where it's heading and if it's something to look at.

sounds reasonable ... but i have no idea what it means. lol

[Tron_fdc]

Originally Posted by DementedReality

so ... for a guy with a house in the NW, considered a slighly better than entry level type of house, with about 50% equity.

we want to upgrade ... sounds like a good time to buy, bad time to sell though.

advice on how to not get killed?

Make sure you have a good realtor, and be prepared to sit on your house for a minimum 90 days. Don't be desperate to sell.....as in don't run out and buy a new place without selling your existing one first. You'll end up dumping it and that's when the sharks start to circle. When you sell it, make sure it's spotless and possibly even staged. These things didn't really matter the last few years but they sure do now. With all the listings right now there has to be something that sets your house apart from other listings in the area. A good realtor will pay for the stager, and tell you what to hide/change in your house to make it more attractive.

If all goes well you can expect to take about 10% off your list price when you sell, and if you look hard enough and find a place with a motivated seller, expect to start with an offer 30% lower than their list. I've seen a lot of listings from people with quite a bit of equity in their house willing to deal just to dump it.

If you can accept taking less than you thought for your house, right now it's actually a pretty good time to sell. If you list aggressively and free up some equity when it moves you can absolutely rape somebody who's stuck and is trying to ditch their property.

[pepper24]

Originally Posted by DementedReality

so ... for a guy with a house in the NW, considered a slighly better than entry level type of house, with about 50% equity.

we want to upgrade ... sounds like a good time to buy, bad time to sell though.

advice on how to not get killed?

You can run around in circles predicting the real estate market. An economist will brag when they're right and hide when they're wrong.

If you're ready to sell and can afford the upgrade (50% equity is probably a yes) I'd go ahead. If the market continues to drop you'll have equity from the house you sell, if it goes up you'll have equity from the house you buy. Being in the market already you're naturally hedged.

[greyshep]

Well I pretty much avoided this thread for the first few months of the year. I was in the situation of having 2 mortgages since January.

Our home sold 3 times before it finally sold unconditionally at the end of July. We didnt fare too badly all things considered... started at 400k, ended up selling for 385k. I am just thankful to be back to 1 mortgage and out of the stress ball of selling a home. Good luck to anyone else out there waiting it out right now. I feel your pain. Its not fun.

What I did learn is that if I ever decide to build/move again I will be selling my existing property first.

[Sylvanfan]

Originally Posted by DementedReality

sounds reasonable ... but i have no idea what it means. lol

Basically you need to determine if the % of price drop in the upgrading housing you're considering is the same or less than the % price drop of your current home.

If the upgraded property has fallen by a higher percentage than your place has for example, the difference in price between your house and the upgraded house is less than it was. If the rate of price drops has been the same it still costs you less total dollars to get into the upgraded place (ie 10% off 600k higher end house makes that house 540 now and say 10% of your 400k house makes your house 360 now...difference today is 180 verses the 200 it used to be). But if the upgraded places are only down 5% and your place is down 8%...than it's costing your the same or more total dollars to make the upgrade.

[Red]

"Real Estate never goes down....."

"Buy now before you're priced out forever...."

"We have Oil in Alberta, houses will keep going up...."



Oh, the memories, where's Dominicwasalreadytaken and all the other resident Donald Trumps? I'd really like to hear what they have to say now. Probably the same as Ed Jensen, we are just seeing a "slight market correction".

Anyways, my worthless advise is to wait until the market is on a upward trend. Never buy while things are on the way down. And don't buy the "buyer's market" crap, it's neither buyer or seller market, it's a wait and see market.

[photon]

What do I have to say now? It was obvious it couldn't continue the way it was and that there'd be a correction... I thought the landing would be soft and it has been (unless you're stuck with a bunch of properties you can't pay, then it doesn't feel soft).

I won't pretend to predict if the market has bottomed for houses, but I don't think it's going to go down massive amounts.. condos still have a lot of room to go down.

I never took a real-estate never goes down stance and didn't buy my places with that in mind; I made sure the stuff I purchased made sense when the market turned around too, not just for when things were going crazy. So my stuff is quietly sitting there being paid off by my tenants and worth more than what I paid for it, so I can't complain. I have one property where I made a mistake buying it, but it isn't hurting me very much so I'll just be patient with it.

I wish I had more money to buy, there's some really good cash-flowing stuff out there at the moment.

[metallicat]

Real estate in general pisses me off, but I've just gotten unlucky. I didn't buy a few years ago before prices went crazy, and then I finally decided to buy a condo last December when I thought prices were at a pretty low level. Now that I've finally moved into my condo, there are still units for sale, and at prices lower than I paid! Argh!

[Red]

Originally Posted by fotze

Little early to be saying I told ya so on that, needs to correct a further 80% for those guys to be crying poverty.

I am not quite at "told you so", but I would like to hear them explain why they think that the market will take an upwards trend again soon. There's no reason for that and things are just starting to get ugly, but in the end it's just my opinion.

With the RE market taking a dump we're looking at a lot of construction people getting laid off, that's not going to help matters since construction workers had as much impact on the local economy as the oilfield industry. Of course that's not looking too hot either.