Real Estate Predictions

[yyzer]

I can tell you that TREB resale numbers for the month of March, when they are officially released in a week or so, will be a pleasant surprise....sales have rebounded, especially in the under 400K price range....

It's a very interesting time in the market right now...

 

[Yossi Kaplan MBA]

To TREB or not to TREB

I can tell you that TREB resale numbers for the month of March, when they are officially released in a week or so, will be a pleasant surprise....sales have rebounded, at least for now....

It's a very interesting time in the market right now...

TREB reports miss on two significant types of transactions:

1 - new developments

2 - assignments

(there are several other types of non-MLS deals as well)

When looking at TREB numbers, remember, it's re-sale, it's averaged to TREB districts, and it's not the entire picture.

Last, the resale component of the transaction slice is a better indicator at low/no developments areas, whereas CityPlace won't make a good indicator if a few large buildings are pre-registration, and couple of others as still being sold: these numbers never get into TREB reports, thus not fully reflecting the market.

 

[yyzer]

well, Yossi, of course the TREB numbers are only resale MLS, and therefore only reflect that aspect of the market....

All I am saying is that these numbers - resale MLS - will surprise people on the upside, when they are released....I am out in Mississauga, and for the last 4 weeks or so, anything in the under 400K price range (and some over 400K) has been selling quickly, very near the asking price...there has been a fairly dramatic change from Jan and Feb, which were totally dead..

Most of this activity seems to be first-time buyers (not investors), who are being attracted by slightly lower prices, and rock-bottom interest rates.....the condo market, certainly in W15 and W19 may not be as robust as the freehold market, but that may simply be an issue of supply and demand....they simply built too many in the Square 1 area, and it will take a while to work through the inventory.....

Most of the realtors that I know are very busy right now...

 

[lordmandeep]

things aren't to bad at our family business.

ever since the Time change our business has vastly improved.

 

[Ken]

well, Yossi, of course the TREB numbers are only resale MLS, and therefore only reflect that aspect of the market....

All I am saying is that these numbers - resale MLS - will surprise people on the upside, when they are released....I am out in Mississauga, and for the last 4 weeks or so, anything in the under 400K price range (and some over 400K) has been selling quickly, very near the asking price...there has been a fairly dramatic change from Jan and Feb, which were totally dead..

Most of this activity seems to be first-time buyers (not investors), who are being attracted by slightly lower prices, and rock-bottom interest rates.....the condo market, certainly in W15 and W19 may not be as robust as the freehold market, but that may simply be an issue of supply and demand....they simply built too many in the Square 1 area, and it will take a while to work through the inventory.....

Most of the realtors that I know are very busy right now...

yyzer, most of the sales are deteched or semi-s?

I agree with what you've observed, and, of course, if I were a 1st time buyer, I would get in right now to enjoy the low interest rate. Question is how long can this '1st time buyer wave' can sustain? Also, if anybody know, is this '1st time buyer wave' occured in the previous downtown? and is this signals the end of the downturn or not? Thanks.

 

[TrickyRicky]

Anecdotal evidence amongst my peers is that many are buying or looking to buy. So I wouldn't be surprised at a bump in numbers, although this is largely a function of my age. The popular sentiment seems to be "oh, I didn't really think I could buy but suddenly I can so I will".

Analysis:

-any surge in under $400,000 listings is not evidence of strength in the market. It is evidence of falling prices and historically low interest rates
-dead cat bounce
-it is conceivable that many people buying now will not realize a net positive increase in their home equity during the first 5-year term of their mortgage. There is nothing wrong with this in the sense that a home is a place to live and feel secure. What it means however is that the good old days are long gone but people still haven't reset their philosphical outlook. I wish everyone the best but those starting out now (new home buyers, I bought 2 years ago) will have the toughest slog in a generation

 

[northstar]

Analysis:

-any surge in under $400,000 listings is not evidence of strength in the market. It is evidence of falling prices and historically low interest rates
-dead cat bounce
-it is conceivable that many people buying now will not realize a net positive increase in their home equity during the first 5-year term of their mortgage. There is nothing wrong with this in the sense that a home is a place to live and feel secure. What it means however is that the good old days are long gone but people still haven't reset their philosphical outlook. I wish everyone the best but those starting out now (new home buyers, I bought 2 years ago) will have the toughest slog in a generation

I'd agree with this analysis. I don't think the value of moderately priced homes is set to crash, but neither do I think it's going to surge like one would expect from a stock market rally.

Again - the question comes to whether one is buying an "investment property" or whether one is buying "a place to live in".

I agree that a change in philosophy needs to occur - because it appears from reading certain posts that many look at a home purchase purely from the investment aspect, as if they were purchasing on the stock market.

 

[northstar]

Also, if anybody know, is this '1st time buyer wave' occured in the previous downtown? and is this signals the end of the downturn or not? Thanks.

I doubt this first time buyer wave happened back in 1990 because mortgage interest rates were in the double digits at that time.

To help cope with uncertainty, people like to compare to previous recessions, to help predict what the future may bring.
However the underlying fundamentals are so completely different, that it's dangerous to make blanket and simplistic comparisons.

 

[yyzer]

all good points raised, including the cautionary ones by TrickyRicky....

at the end of the day, who knows? Everybody needs to live somewhere, and as long as your job is relatively secure, it may make sense to buy now...one thing is certain - as soon as the economy recovers, interest rates will jump..

Ken, I think the sales are all of the above - Semis, detached, townhouses, etc....

 

[urbandreamer]

Homes under $400k (semis, bungalows, etc): moving quickly at or slightly above ask.--selling mostly to condo kids moving out and 1st timers....

Homes above $400k: very slow, below ask.

Homes in Rosedale and Forest Hill: on sale for 35-50% off peak 2007-8 prices! Best deals in town!

Resale Condos: below $250k: moving along okay.

Presale/resale condos: luxury product (above $500k): forget about it!

Power of sales: Big increase here.

One interesting note: massive surge in new listings this past week, anyone else notice it? (See Montreal MLS for what's in store.)

 

[mrl14]

I don't recall my salary doubling from 2002-2007...so not sure how I can afford a home that's doubled in price too. People are in for a real shocker if they think prices are going to not only go back up in 3 years, but go back up to bubble prices . We need to collectively stop buying and giving developers the ability to keep raising prices!

Homes under $400k (semis, bungalows, etc): moving quickly at or slightly above ask.--selling mostly to condo kids moving out and 1st timers....

Homes above $400k: very slow, below ask.

Homes in Rosedale and Forest Hill: on sale for 35-50% off peak 2007-8 prices! Best deals in town!

Resale Condos: below $250k: moving along okay.

Presale/resale condos: luxury product (above $500k): forget about it!

Power of sales: Big increase here.

One interesting note: massive surge in new listings this past week, anyone else notice it? (See Montreal MLS for what's in store.)