Realestock Blog

Ah January – a time for prognostication. Everyone channels their inner Nostradamus and attempts to make sense of the swirl of information around them – trying to figure out what’s relevant and what’s not. Sure there are tons of prediction lists that come out at this time of year, but we at Realestock are going to try something a little different with ours - we’re actually going to hold ourselves accountable. In December of 2011, we’re going to look back and try to determine which of our predictions were right, which were so-so, and which were so very, very wrong.

So what do we think will happen in real estate this year? We’ve boiled it down to 6 firm predictions:

1. The market will stay flat, but people will still look towards a recovery, and every small rise and fluctuation will start people talking all over again. The markets are looking up, and stocks are rising, but job growth is still looking slow and that means we don’t think the market is going to leap up towards previous levels. The CREA is predicting Canadian home sales to fall by 7.3% overall in 2011 and we agree with them.
2. Low prices means affordable prices – those who can buy houses will continue to do so, driving modest sales and making starter homes attractive. Due the excesses of previous years, people will be a lot more conservative in their choices – looking to stay well within their means and choosing more affordable homes.
3. Renting will be cool again. Yes, really. Even with low rates and affordable prices, many will opt to rent for longer to save up bigger down payments to keep their mortgages low and affordable in the long term. People have learned the lessons from the disasters of Adjustable Rate Mortgages in the US, and we think people will wait longer to avoid being caught by sudden rate hikes.
4. Governments will continue to keep interest rates low and mortgages attractive – even in places with hot real estate markets like British Columbia – we think rates will stay right where they are in some places and very gently rise in others to avoid unbalancing a slow economic recovery.
5. It’s tough out there for mortgage brokers and real estate agents. And it will continue to be. Sorry guys.
6. Realtors and developers and brokers will get smarter – not work harder to stick it out. In order to differentiate themselves in a tough market, real estate experts will continue to blog, tweet and socialize themselves into a market position. Social media aggregation will be a big trend this year, with more and more companies using neat tools like these social media hubs to collect all their content together and make their lives easier.

Sources: Top 10 Real Estate Predictions for 2011, Elizabeth Weintraub; BCREA Housing Forecast; 2011Real Estate Outlook, Jerry Barker; 2011Canadian Real Estate Market Forecast and Prediction, Kurt Hemmerling

Picture: KayVee.Inc

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New year, fresh start? If you’re thinking of moving, or waiting to make a big move in the new year, selling your home is the first step. So, how can you make your goals a reality? Here are some simple tips to make your home sell.

1. Price it right: The first step to selling a property is setting it at the right price. Prices should be set against the prices similar properties are selling for – not what they’re being listed for. In a buyers market, a competitively priced house will sell long before one going for more than the market will bear. There are people who want to buy, but they want to buy at the right price.
2. Fix it up: Nobody wants to buy a property with a huge to-do list built right in. Even small repairs can put off buyers, so get a critical friend to come and help you see what touch ups and repairs need to be done.
3. Make it look great: This is just common sense – tidy, remove clutter and clean the crap out of your home. Stage your furniture to show off your home’s best assets – you’ll impress buyers and show off the best assets of your home.
4. Offer incentives: Adding too many premiums can make sellers look desperate; however incentives like help with closing costs can encourage buyers. If you want to make your realtor work for you, offering a bonus on the commission for a speedy sale can work wonders.
5. Be prepared and be flexible: Have a plan in place – know ahead of time what price cuts you’re willing to agree to, and what you won’t. When you plan ahead, you’ll be able to move quickly on the offers you receive.

Thanks for reading the Realestock blog in 2010. We’ll be back in the first week of 2011 with even more great tips, tricks and industry advice!

Photo: The Truth About Mortgage

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Luxury real estate sales in Canada are soaring, breaking pre-recession sales records as buyers are capitalizing on low interest rates and increasing economic confidence.
RE/MAX released its first quarter Upper End 2010 Report on Monday, showing a marked increase in luxury home sales in markets across Canada. The report noted that, "Canada's sound banking system, political stability, and strong dollar are attracting foreign investment -- and that is spilling over into high-end residential real estate.”

According to Wayne Schrader, a RE/MAX Broker/Owner and specialist in luxury properties on Vancouver Island, consumer confidence is playing a big part in the rallying sales.
“Markets are picking up and turning the corner,” said Schrader. “People are realizing the big recession didn’t materialize in Canada, and at the same time, prices have come down and are much more attractive.”
The Conference board of Canada echoes Schrader’s sentiments - its economic forecasts predict the Canadian economy will grow at a healthy 3.2% in 2010. An upswing in the economy makes the current market conditions even more attractive, as buyers take advantage of the current low interest rates, noted Schrader.
But why have sales increases have been so sharp, in some cases bettering years that were fueled by the white-hot real estate markets of the time? According to Schrader, and the report, they key is balance.
High end property prices have softened from their previous peaks explained Schrader, which can make luxury real estate look like a better investment for some buyers.
“Ample opportunity and a good selection of product exists, and savvy purchasers are taking advantage of favourable conditions,” said the report.
According to the Elton Ash, Regional Executive Vice-President of RE/MAX in Western Canada. the luxury “segment of the market was hardest hit when the recession took hold, yet its comeback has been fast and furious.”
Comparative sales figures back up Ash’s statements. In the first quarter of 2009, high end property sales had slumped - only 411 properties classified as “upper end” were sold by RE/MAX across Canada. This year, the number has leapt to 1,111 - an increase of more than 170%.  Comparing that to 2008’s first quarter sales of 894 high end properties shows overall sales in Canada are still up almost 24% over pre-recession numbers.

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The general consensus seems to be that the Canadian Real Estate Market is still one of the least disastrous markets worldwide. However, this doesn’t mean that this is a secure market. Sale prices are declining like everywhere else, and the current semblance of stability is only related to the fact that Canadian lenders and banks were, in previous times, much more conservative than lenders in other countries.

However, the market in Canada is by no means in the same state as it was a few years ago, which is obvious than when you look at a city like Vancouver, British Columbia. Vancouver had some of the most insanely hyper-inflated prices in the last few years, and so now that are fewer buyers, there are a distinct lack of properties being sold, and those that do sell, sell low.

On Friday in the Globe and Mail, Kerry Gold wrote an article misleadingly titled ‘First Time Buyers Drive a Rebounding Market” as it also talks about buyers who are upgrading, as well as those who are first time purchasers. One interesting point about this article, is the reminder that there are certain types of buyers who will always exist in any market, and will be the ones who will stop the it from going into complete cardiac arrest. This is, of course, as long as they are not completely scared off by the onslaught of negativity that currently invades the real estate market. Just joking:

1) First Time Buyers: If you are a first time buyer, this is a great time to get on the first rung of the ladder – but only if you are brave enough to take the plunge, and can get a mortgage. Prices are low, mortgage rates are low, and now with tax advantages ahoy, this is the best opportunity that you’ll get for a while!

2) Growing Families: When one’s family starts getting bigger, the need for more space necessitates the move to a bigger place. Last time I checked, people hadn’t stopped having children, and again, if you bought a while back, you’ll have equity in your property, and upgrading in a low market will not make much of a difference

3) Empty Nesters and other ‘downgraders’: At the other end of the scale, there are people downgrading. As long as one is moving within the same or a similar market, downgrading is not a big problem, as the gap between your lower priced large home, and your lower priced small home should be pretty similar.

4) People who are Relocating: When the job market is not secure, people will move where the jobs are, so this market is almost certain to generate a good deal of relocation. As this is born out of necessity, these people buy and sell in any market!

While this is not entirely newsworthy, it is worth remembering that these kinds of buyers exist in every market, so whatever the economy situation, there will still be these kinds of buyers to keep things going. Think of them like the superman of buyers...come to save us all from certain disaster. Which in the current bad news market is a little piece of good news. Shock horror, eh?

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In the last few weeks, there have been plenty of discussions in terms of whether the new US Government financial stability plans are beneficial or yet another example of throwing away good money after bad (as my grandmother would say). Everyone has an opinion on the various stimulus packages that have been brought forward from both the current and previous administrations.

I have trouble deciding who should be bailed out, and who shouldn’t. No one wants to reward irresponsible behavior with a ton of money, but conversely, there are people who are underwater on their homes through no fault of their own. Many people make snap judgments on people who took out subprime mortgages, but frankly, these people need to get off their high horses. If someone offered you the chance to have something that you thought you could (just) afford, in a housing market that seemed to be on the up, many people would take the chance. Two or three years ago, your average Joe could not have predicted that there would be mass unemployment and an unprecedented drop in home prices.

Bailing out the big banks, mortgage companies, and other corporations leaves a bad taste in everyone’s mouth. Who could forget seeing the CEOs of the big three squirm in their seat when asked whether they would be selling their private jets and returning home via a commercial airline? However, as time goes on, jobs are being lost, houses are being foreclosed, and stock prices are shooting down, something needs to be done.

President Obama’s current packages seem to be taking a different technique from the last administration. While the Republicans’ strategy was more to encourage consumer spending and the growth of businesses, the Obama administration seems more aimed at directly helping consumers, particularly homebuyers.

In the last month, three new strategies have been launched by the administration: The $8,000 tax credit for first time buyers, and the Making Home Affordable Refinance and Modification options. These are available to the following buyers, and are summarized as follows (more in depth information can be found at http://www.recovery.gov) :

$8,000 First Time Buyer Credit. You may be eligible if:

- You are a first time buyer.

- if you have a single income of up to $75,000, or a combined income of up to $150,000 (this will mean you receive the full tax credit of $8,000)

- You bought your home on or after the 1^st of January, 2009, up to the 1^st December, 2009.

Home Affordable Refinance. You may be eligible if:

- The mortgage is on your primary residence

- The loan on your home is a conforming loan, controlled by either Fannie Mae or Freddie Mac

- You are current on your mortgage payments (meaning you haven’t missed a payment by more than 30 days in 12 months)

- You are not ‘underwater’ on your mortgage –(meaning you cannot owe more than 105% of the cost of your home. (But 80% - 105% is OK))

For those not eligible for this plan, there is also the Home Affordable Modification. You may be eligible if:

- The home is your primary residence

- You owe less than $729,750 on your mortgage

- You are in some kind of trouble with your mortgage that is beyond your control at this point: e.g

1) Your mortgage rates were increased significantly

2) Your income has been significantly reduced since you got your current loan

3) You have suffered a hardship that has increased your expenses (e.g. medical bills)

- You began your mortgage before January 1, 2009

What is your view on these packages? Will they help? Will they benefit the economy as a whole, or are they just a temporary band aid over the real issues? What do you think? Will the cost of these measures be more or less than the cost of many, many foreclosures? Feel free to comment below.

The views expressed on the blog portion of this site represent only the opinions of the author and may not necessarily be the opinions of Realestock.com

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In this week's Globe and Mail, the title “B.C. Housing Market in Deep Freeze” caught my eye. To me, deep freeze is not such a terrible thing. For example, say I bake a really delicious pie, and I can’t eat it all. I might not want to eat it that evening, but I still intend to eat it sometime, so I stick it in the deep freeze and defrost it a few weeks later. Granted, it’s not quite as delicious as it was when it was fresh, but it still tastes pretty good.

According to the Globe and Mail, new developments in Vancouver, and across BC seem to be stalling, or stopping completely. Vancouver developer Ward McAllister talks about the fact that no-one appears to be beginning new projects in 2009.

The article goes on to talk about a variety of different opinions as to how this year will play out. Some say that by the end of 2009 the housing market will have returned to some kind of normality, while others are being more conservative, and saying that we have a few more years yet. Many are suggesting that there will be no upturn until a year from now around the time of the Vancouver Winter Olympics in 2010. That’s a long time if you are depending on building-related work. It is estimated that one in ten people in BC works in the construction industry, or in a job related to it. Therefore we are not just talking about obvious job losses, for people like welders, bricklayers or foremen, but factory workers who produce materials, or marketing people who work for developers, or the developers themselves. If there are not any new builds in 2009, there are a number of people who will directly suffer, and then the trickle down will indirectly affect us all.

Some solutions as to what developers and others in construction can do to are mentioned in this Globe and Mail article. They include:

· Building rental apartments

· Selling the land meant for condo developments and such to BC housing, to see if they might want to use the land for public housing projects

These are great ideas. Whether BC housing will take them up on the land offer (if everyone is trying it, then probably not) is debatable, but the idea of building rental apartments is an awesome idea. According to an article I read in Forbes a while back, housing and building supplies are coming down in price, so developers could use these now less expensive materials to build decent apartment housing (a rarity in many BC cities, I’m talking about you, Victoria) which will provide an income, and can be sold when the market upturn happens, whenever that is.

The Globe and Mail talks about some developers who have made enough money in the past to ride this out. Many of them are planning more complex, intensive sites, which require more permits and planning than regular condo developments. Planning for the future is another good way, as long as one can afford it, and still be around when it comes to building it!

In terms of terrifying headlines, in my opinion ‘deep freeze’ is better than ‘recession’ ‘downturn’ ‘crash’ and my personal favourite ‘depression’. It implies that that pie is going to be in the freezer for a long time, but eventually, we’ll be able to defrost it, and get on with things…and I for one am getting the ice cream ready.

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2009 is nearly upon us – and some might say that this has not come a moment too soon. This year has been anything but dull, but at times we could have done with a little less drama. To ease you into 2009 (which many analysts fear may be as tumultuous as last year) here are some reminders of things that happened last year… which may make you glad that we are leaving it.

Top News Story of the Year: Financial Crisis

The only way that you might have missed out on this is if you were living in a cave, under a rock. Definitely the defining story of 2008: from bailouts to stimulus packages, from crashing mortgage rates to foreclosures, every day brought new and more terrifying stories. This was not a good year to have real estate and business news Google alerts sent directly to your email account – unless you enjoy receiving 15-20 pieces of bad news a day.

Top Real Estate Story of the Year: House prices tumbling, back to basics mortgages and foreclosures ahoy

Yep – it’s not good news. Most markets saw some reductions in sales, and prices dropping – whereas other markets saw massive drops and the inability to sell at all. This, and the shrinking economy lead to an increase in foreclosed properties – which has meant many people have lost their homes this year. The consequence of this is that many banks and other lending institutions have become more prudent and restricted their lending policies. You can still get a mortgage, but you’ll need to have a good deposit, a steady income, and a good to stellar credit score.

Top Slightly-Less-Depressing Real Estate Story of the Year: First Time Buyer Alert

2008 was a good year for first time buyers to get in on the action. Providing you could get a mortgage, this was a great year to invest in real estate. This can only get better for first time buyers as 2009 continues, as prices will be dropping further. So when your 35-year old son says he still needs to live in your basement for free because “house prices are too expensive” feel free to chuck him and his ever growing laundry pile out in January.

Top ‘Most innovative ways to sell your house’ Stories of the year

My top three?

1) Can’t sell your house? Why not raffle it off? Sounds insane? That’s because it is. But desperate times call for desperate measures. In October, the Globe and Mail talked about homeowners who have narrowly avoided foreclosure, and made money. However, it’s not easy: some states/provinces will not legally let you raffle your house.

2) Buy the house, get the car free! In November, the National Post reported that a seller who couldn’t sell their East York home at a lowered price was offering potential buyers a free vehicle – worth $15,000. As of posting time – no news on whether it sold.

3) Find a buyer? Get $100,000. At the beginning of December, David Bangert and Linda Harris of Kailua, Hawaii REALLY wanted to sell two million dollar pieces of property. So they offered a reward for $100,000. If you could find someone who wanted to buy their houses, and more importantly, were funded to buy them, you could get up to $100,000 as a reward. Again – no news as to whether they sold or not.

Top ‘Good News Story for us: Most homebuyers are now looking on the Internet for their new home

According to the 2007 National Association of Realtors Profile of Home Buyers and Sellers, 84 percent of buyers use the Internet to search for a new home, and this is a trend that has continued through 2008, and will continue into 2009. The Chicago Tribune, in its Eight Real Estate Trends for 2009 article, have predicted that as more buyers go online, more realtors will want to post their information online – which is great for sites like Realestock, who offer easy ways to upload properties on to our site – for free – to millions of eyes!

So happy new year, and let’s hope 2009 is a good one! We’ll be blogging in the New Year, and also releasing our new monthly newsletter – the Realestock Report. We wish you the very best for a prosperous 2009!

The views expressed on the blog portion of this site represent only the opinions of the author and may not necessarily be the opinions of Realestock.com

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This morning on Forbes.com, I read an article about the cities in America that are most likely to weather this real estate market, and be a great long term investment. Forbes listed the top ten as:

10. Atlanta, Georgia

9. Portland Oregon

8: Cincinnati, Ohio

7. Philadelphia, Pennsylvania

6. St. Louis, Missouri

5. New York, New York

4. Minneapolis, Minnesota

3. San Antonio, Texas

2. Washington, D.C.

1. Seattle, Washington

Living in the Pacific Northwest (Well, south west to those of us in Victoria, BC, Canada), Seattle was not a surprise at number one. However, I found some of the cities on the list to be quite surprising, such as New York, where housing has been so horrifically over priced for some time – Or a Midwest city like Minneapolis, where one would assume businesses are feeling the crunch, which would be reflected in the property prices.

However, looking at this list in detail, it is possible to see that these cities all share things in common that make them more likely to ride the current crisis, and therefore great places to buy real estate. I am not suggesting that you pack up your belongings and hot-foot it to Cincinnati. However, what we should be doing is looking at where we want to buy, and seeing if the area has similar characteristics which may make it a good deal. Smart buying is the new way to buy in this market.

Everyone loves….

Do you live somewhere where everyone wants to live? I live in Victoria, British Columbia, and while it was one of the most expensive places to live in Canada at the height of the boom, I am not quite throwing myself off my third floor condo just yet. Why? Because Victoria is well known for being the place where people want to retire to in Canada. The city is beautiful, the weather is usually excellent, (note: we are currently having freak winter temperatures of -4°c. This is not normal….bbrrrr…) and it’s an all round great place to live. Whatever happens, these things will not change, and people will still want to move here. So if you live in an area that is growing in terms of incoming population, you might just make it through the next few years.

Taking care of Business?

Minneapolis may be in the Midwest, but unlike other failing Midwestern cities, Minneapolis has less of a manufacturing base, and has diversified in the way that has kept it going through current hard times. A number of corporations are based in and around Minneapolis, such as Target, General Mills and PepsiAmericas inc.

Look at the companies in your town. While nowadays it’s very hard to guess which companies are going to survive, and which won’t, if there are a number of stable corporations, you should be safe. Also, if like Minneapolis, your town has diversified, and doesn’t depend on just one industry (such as forestry or automobiles); this is also a good indication of a ‘safe’ place to buy.

Low unemployment is also an important factor. If the number of ‘positions vacant’ signs are larger than the amount of ‘for sale’ signs, you’re on to a winner.

No.place else to go!

Sprawling cities such as Sacramento allowed developers to build build build. However, New York and San Francisco are both places where there isn’t really any space to build extensively - which means that property still sells because people have to live somewhere, and less housing = more people who want to buy your condo.

Conservative building practices

While everyone may have been frustrated about strict building codes and practices in the past…you should now be running over to those city officials and kissing them all over. Why? Because cities with strict building codes will be more likely to recover from this recession. For the same reason as the space point above, people have to live somewhere, and if there are less places to buy, those that are for sale, sell.

A little note about foreclosures…

While foreclosures are more of a symptom, rather than a cause, the disease metaphor works because if your city is riddled with unemployment, a bad economy, and a lack of people moving to the area, you’ll see more foreclosures. So, unless you are looking to buy a foreclosed property (and there are plenty of good reasons for that), you might want to avoid areas with a high level of foreclosures.

In the end, we’re all trying to look for hope in this market. However, buying in areas where these things occur is always going to be a safer and more sensible way to buy real estate in the current market. Most of these points are common sense – but that may be the way in which we come out of this market – slow and steady wins the race. So buy smartly – which will help you to sell smartly in the future.

The views expressed on the blog portion of this site represent only the opinions of the author and may not necessarily be the opinions of Realestock.com

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We attended the Urban Land Institute (ULI) conference at the end of October. The event was very interesting and successful, but it’s only now that we’ve had the chance to sit down and really think about what we learned at the conference – and what will stay with us, way into 2009…

1) Things are not as bad as they seem: everyone at that conference intends to be in business for next year’s conference, and the year after that, and the year after that. People are working hard, deals are being made, and things are getting better, but it’s hard to fight against the perception that is being propagated by the media. However, if you speak to realtors, developers, sellers and mortgage lenders, you’ll see that there is business to be made, and deals to be done. It’s just a little harder right now…

2) People are looking for innovative ways to sell developments and real estate: Rent-to-buy, auctions, pricing drops, online special offers, social networking…people are trying a variety of different techniques to keep selling real estate. Diversify or die – the buyers' market means that realtors and developers MUST get more creative. A couple of ‘open house’ signs on the street does not a advertising campaign make, so if you don’t understand blogging, have never posted on a web board, or you have no idea what a ‘tweet’ is – you’ll be left behind in the new world of marketing. (p.s. Cheeky plug: check us out at http://twitter.com/Realestock.)

3) Print advertising is dead: Our booth was extremely busy. Why? Because we are offering something quite different from other advertising companies. Our advertising is all online, so we use new and innovative ways of marketing, and we don’t waste your budget like traditional advertising can. For more information on our full package for your marketing success,

4) People are waiting for the big turnaround: 2009? 2010? When will it be? Many realtors, developers and sellers are conserving more and spending less, delaying sales, or even renting out properties until people start buying again. The reason being that these businesses need to survive, and if you can’t afford filet mignon, you’ll dine on Kraft Dinner until you can.

5) Environmental and Green Building – It’s on the up! Once a niche market, this is now becoming the norm, and people are expecting to have features such as low flow toilets, good insulation and other innovations which save the environment, and save money. As oil, gas, and other materials become more and more expensive, it is not just the traditional environmentalist demographic who are interested in ‘going green’. Granted, for many people, it has nothing to do with the environment, and everything to do with saving money, but whatever the reason, environmental building is becoming very popular, and green houses are still selling, even in this market.

6) The coordination of houses and transportation: Suburbia experienced growth in the mid to late 20^th century because people were interested in moving out of the cities to get bigger houses, more space, and a better life for their families. Now that people’s priorities have changed, and most people are looking for energy efficient houses, easy accessibility to schools, shops, businesses etc, the suburban landscape is in decline. There is even a trend for families with children – the original suburban demographic – to move back to the city for reasons such as better childcare options, better education, and more choice. This doesn’t mean that the end of suburbia, but it does mean that things will have to change. Better transportation links such as buses and other forms of transit, in addition to encouraging more family-friendly opportunities and a better sense of community will enable suburban housing to stay competitive in terms of reaching young families and other buyers.

If you were at ULI, let us know what you learned, and whether you think these themes will stay constant through 2009.

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We are pleased to announced a new and beneficial partnership between Realestock.com and Microsoft® Financing!

Tim Vasko, the CEO of Realestock has reported that: “Realestock.com is experiencing 30% higher search and request volume than it was this time last year” Which verifies the fact that buyers are turning to online searching to find their new home, and so if you don’t have an online presence, then you don’t exist.

However, the cost of starting up online can be too much for many developers to afford. This is where our financing options come in.

Realestock has recently teamed up with Microsoft® Financing to offer clients an easier way of paying for our services, such as allowing you to spread payments over a designated time period, rather than paying for all of your software and service needs up front.

Instead of paying us directly, you are approved quickly and efficiently* by Microsoft®, further streamlining the purchasing process.

Because of this partnership, we are now able to offer a limited time deal (until the 31^st December), which allows you to pay nothing for any advertising or marketing until June 2008. We do this because we know that you’ll enjoy the benefits that Realestock has to offer you.

To find out more, please contact us, and one of our business development experts will contact you. Remember, this offer ends on the 31^st of December, so click NOW to start getting the ultimate return on investment!

* Available OAC , offer ends 2008. Offer valid with one year contract purchase of 1to1Real ™ and iQ3 Guaranteed Leads™ Program

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