October 2008 Market Review

Calgary has been through quite the ride over the last couple weeks.  I’m sure that most of Canada has felt something with the financial crisis that we have all seen and gone through.

As I write this, we are in a better place than we were at the end of October.  But it is somewhat to be expected as invetory usually drops off this time of year.  End of October we were sitting around 8500 listings and right now we are just over 8000.  This is good, except that we still have 7.8 months worth of invetory on the market with the number of sales that are happening.  In a truly balanced market, we should see this number of months be around 2-4.

Advice to Sellers:

Right now, you are wanting to really stay on top of the pricing of your home.  We have bargain hunters out there, with low bids that are driving the prices down.  If you are in a true need to sell your home, you will have to most likely cut your price further, as this is what buyers are looking for right now.  As in the past, when it was the sellers day to shine, and prices were rising, and it felt you could ask almost anything for you home, it’s reversed.  Will it stay this way forever, and prices go back down to year 2000 prices… probably not.  We still have a strong economy.  Across Canada, prices have dropped about 14% and Alberta had the least amount of price reductions at 7%.  We are still THE province in Canada.  But make sure you take a serious look at what it is your selling, and what your asking for it…

Advice to Buyers

BUY… BUY… BUY…  Right now, more than ever, is a great time to purchase a new home or investment property.  Especially with Christmas coming up and the number of motivated sellers rising daily.  We have seen some incredible price drops, and buyers that we work with get some great deals.  These days will pass, and it will go back to a balanced or a sellers market, so you don’t want to miss your chance to get into the new home that you are waiting for…

Here is a link to the last CREB (Calgary Real Estate Board) report put out for October 2008

Below are some graphs about the Calgary Real Estate Market over the last year… Hope you find them helpful.

You can click on the images to enlarge them in a new browser window.

September 2008 Market Review

September has been a good and bad month for real estate.  What I mean by this is that the Single Family market has recovered some in the absorption rate to 4.7 months of invetory from 5+ last month, and the Condo market has gone over 6 months of invetory.  For single family, this is a good thing… what I mean is that it is now a strong buyers market and prices should not decrease and such great speed now.  But rather float around where they are currently at.  For Condos on the other hand, the prices will probably continue to drop much quicker.

The Condo median price has decreased 11.67% from September 2007 to $265,000 where as the Single Family homes median price has only decreased 6.06% to $395,000 from the same time last year.

Advice to Sellers:

My advice to sellers continues to be to emphasize the critical importance of pricing your property for the new reality. It is crucial to get ahead of the decreasing prices in this market. Most sellers instinctively want to be on the higher side when choosing a list price – it is natural to do so. To be honest, it is also a mistake in this market. If anything you want to be on the aggressive side with respect to list price in this market.  There are many reasons for this, but the biggest one is competition.  You as a seller will have a number of homes that you are competing against, and you need to make your home stand out to the potential buyer.  Most buyers the we work with day in and day out are looking for one thing… a good deal.  It is human nature to want to get a deal, and rightly so.  We all want a deal!  As I have talked about before as a seller, you need to put your foot in the shoe of a buyer, and offer what they are looking for.

Advice to Buyers:

BUY… Right now there are great opportunities to purchase.  With the banks starting to tighten their lending, and prices in single family homes starting to stabilize, but still remaining a strong buyers market, there are some great deals to be had.  If you are looking in the Condo market, prices will most likely continue to fall further, as the number of new condos coming on the market via builders, and speculative buyers will rise and in turn create a further downturn in the prices in condos.

Below are a couple graphs that you may find usefull.

20% Further Price Reduction?

In a recent Calgary Herald Article that was published this past weekend (Saturday September 13th) stated that a couple realtors in Calgary said that the home prices would be decreasing another 20% over the coming year.  One agent stated…

“Prices went up nearly 100 per cent in 2-1/2 years,” he says. “Let’s just say the ‘why’ for the decline can be found in the words, ‘Too far, too fast’.”

I do agree that there was a huge increase, but I do disagree that it was too far, too fast.  If we had increases like this over 5+ years, than yes, but in this case, the market is adjusting and finding it’s new bottom.  Every booming economy has it’s moments of breathing.  The market is alive and therefore needs to breathe.  As a seller in this market you really need to be on your game and know your ’stuff’.

Seller’s also really need to think like a buyer in this market.  By this I’m saying that you need to put your feet in the shoes of a buyer, and clearly understand what they think, so you are able to market to them properly.

The market is changing, and will do so for a while. Prices will most likely decline, to what extent and for how long?  Great question… don’t know…  When the market finds it’s new bottom, then we will be able to for sure say… “The Sellers Market is Back”.

On the flip side, it is truly a great time to purchase a home.  If you are planning on living in the home for 2+ years, there are some great deals out there.  If you are looking to do investments… again, great time!  If the investment will be a flip of a home, you might want to stear away from that right now, but for long term rentals… that’s the place to be!

Cheers!

May 2008 Market Review

It’s been a while since the last post, but wanted to give you an update on where the Calgary market place is at!

We have seen some slight growth in the number of showings lately, but it still for sure a buyers market! There is still 1 buyer for every 5 homes (or sales) per week… that we can see. If you are looking to purchase a home, there are some very good ‘deals’ out there currently! As from what I’ve heard, it is like this throughout Alberta… It’s a great time to buy right now.

Here is a link to the Monthly Stats Package!

I also wanted to give you some info on the community sales info on each community through out Calgary… Below is a link to the Single Family info and the Condo info for all of Calgary… Enjoy!

May 2008 Community Stats Single Family
May 2008 Community Stats Condos
Cheers,

Jared

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