Kelowna real estate will be severely affected by recession

[Queen K]

I spoke to a person at the Home Show this weekend and he said he is carrying three mortgages, two of which were condos meant to be flipped. But now he can't get tenants, is thinking of moving into one of those condos himself because his SFD is more desirable as a rental than condo full of strata rules. And hoping for the best. His last line was, "and I don't plan to give them away."

[Devil's Advocate]

His last line was, "and I don't plan to give them away."

"Plan" being the operative word. His original plan didn't work out too well either did it?

[Queen K]

His last line was, "and I don't plan to give them away."

"Plan" being the operative word. His original plan didn't work out too well either did it?

Maybe it did until RE, condos that is, went bust. The fact is even if one got renters, there is risk involved. Just today a subcontractor came to clean out the house that the RCMP had to use a battering ram to evict the renters. So that would not be covered by insurance because cleaning up after tenants is a normal cost of property ownership. I'm sure the Property Managers will just tack the clean up job on to the owners bill, as they would all the stuff they had to haul out in the last few days.

Risk risk risk.

[SCL]

http://www.bnn.ca/7149.html

[duke98]

The RE bust can cause even bigger problems to many home owners because of the lending style in Canada.

Unlike US with fixed-term mortgage throughout the term (i.e. 30 years), we need to re-finance every 5 years (or shorter). With floater rate mortgage, the increase of interest rate will impact instantly. The central bank of Canada lowered the rate to 0.25% which is the lowest since their first operation in 1934. This is very bold sign of economic down turn. They believe that they can prop up the economy by lowering the rate, just like Ben Bernanke in US did. Most people now enjoy very low mortgage rate, but it won't last and will change in less than a year. The unemployment rate is rising fast as it went from 6.5% in December 2008 to 8.0% in March 2009. Losing jobs is a huge issue in US as their unemployment rate went from 5.5% to 8.7% in less than two years, but the speed of losing jobs is much faster in Canada. It took a year in US to have 1.5% unemployment rate increase compared to 3~4 months in Canada. This is a big concern. Canadian economy relies on US and there is no positive sign of recovery in sight yet.



As more people lose jobs, more homes will be on sale. Vancouver will be hit the hardest as they don't have big enough industry to maintain the cash flow. Calgary will be the next as their oil industry is not doing well and some oil companies will file bankruptcy causing large scale job losses. Toronto will follow the same trend.

Everyone!! Hold on tight as our roller coaster goes over the apex!!

[nansibusch]

Hello I have been wondering why the Real Estate agents are always vocal about the market, but I have not heard one word about what they might do to help the market sustain! Many of the agents have been made millionaires in the Okanagan while the market was rising. Are they prepared to pitch in now? Are they prepared to drop their rates? $30,000.00 every time a house sells is not acceptable. They need to acknowledge their part in this reduction in A. people being able to afford a home, and then B. Severe reduction in sales in the Okanagan. Lets hear what you have to say!

[Captain Awesome]

Hello I have been wondering why the Real Estate agents are always vocal about the market, but I have not heard one word about what they might do to help the market sustain! Many of the agents have been made millionaires in the Okanagan while the market was rising. Are they prepared to pitch in now? Are they prepared to drop their rates? $30,000.00 every time a house sells is not acceptable. They need to acknowledge their part in this reduction in A. people being able to afford a home, and then B. Severe reduction in sales in the Okanagan. Lets hear what you have to say!

That is a bit of backward logic. If you want to save money when selling the house, there are plenty of discount agents available or you can even sell it yourself.

If you're worried about being able to afford a home because of their fees, may be you should't be getting into the game in the first place.

[SCL]

I agree with nans. If a realtor's stock broker tried charging him/her the commission a realtor charges on a home, the realtor would have a conniption fit.

[Boda]

I agree with nans. If a realtor's stock broker tried charging him/her the commission a realtor charges on a home, the realtor would have a conniption fit.

Maybe some realtors overcharge, or maybe you get what you pay for but I don't think that comparing those two "professions" is fair. They use different tools of the trade, they probably spend varying amounts of time on transactions, and therefore have varying overhead costs.
You can't fairly compare the fees charged by two "professionals" offering different services.

[SCL]

I agree with nans. If a realtor's stock broker tried charging him/her the commission a realtor charges on a home, the realtor would have a conniption fit.

Maybe some realtors overcharge, or maybe you get what you pay for but I don't think that comparing those two "professions" is fair. They use different tools of the trade, they probably spend varying amounts of time on transactions, and therefore have varying overhead costs.
You can't fairly compare the fees charged by two "professionals" offering different services.

I work as an accountant and get to see their expenses and income, they are very overpaid for what they do. A house sells itself, not a realtor.

[Devil's Advocate]

I agree with nans. If a realtor's stock broker tried charging him/her the commission a realtor charges on a home, the realtor would have a conniption fit.

Maybe some realtors overcharge, or maybe you get what you pay for but I don't think that comparing those two "professions" is fair. They use different tools of the trade, they probably spend varying amounts of time on transactions, and therefore have varying overhead costs.
You can't fairly compare the fees charged by two "professionals" offering different services.

I work as an accountant and get to see their expenses and income, they are very overpaid for what they do. A house sells itself, not a realtor.

:coffeecanuck: :dyinglaughing:

What can I say? Oh the temptation. Misconceptions, realities, deaf ears.... must hold back, must not get into an online arguement.

There is no education like experience and an education is a bargain at any price...

:sleepdeprived:

[Static]

I notice sales volumes are half of what they used to be and inventory nearly doubled so where has all the magic Realtors perform gone to? What are people paying you guys for when you cannot sustain sales levels and prices? The market is doing a great job of confirming my belief in the uselessness of Realtors.

[Static]

I know, I know... send these people away to a place far far away. Tell them to call Glen MacKenzie at One Percent Realty Ltd (Van) cellular 250-870-4536. He will list your home for a lot less (and offer the selling broker a lot less too). Good luck. sarcasm off

So basically what your are saying is that unless a realtor is compensated the way he/she wants, that realtor will not look out for the best interests of the client? Very ethical. Just proves my point again.

[Devil's Advocate]

I notice sales volumes are half of what they used to be and inventory nearly doubled so where has all the magic Realtors perform gone to? What are people paying you guys for when you cannot sustain sales levels and prices? The market is doing a great job of confirming my belief in the uselessness of Realtors.

Perfect! You have an eloquent way of making a point that you should run with. And what exactly is it you do for a living Static? It's a free world, well has been, so if being a Realtor is such a lucrative endeavor why don't you become one? After all to be a successful Realtor all you have to do is take a short correspondence course, stick a for sale sign in some agreeable wanna-be sellers lawn at their stated asking price and sit back in a comfy chair waiting for the offers to come rolling in while you check out the local blogs. It's a cake walk man - a license to print money. Tell you what, I might even consider trading you jobs and paycheques for a time. Surely you could do my job and I know I could do yours. What do ya say?

[Devil's Advocate]

I know, I know... send these people away to a place far far away. Tell them to call Glen MacKenzie at One Percent Realty Ltd (Van) cellular 250-870-4536. He will list your home for a lot less (and offer the selling broker a lot less too). Good luck. sarcasm off

So basically what your are saying is that unless a realtor is compensated the way he/she wants, that realtor will not look out for the best interests of the client? Very ethical. Just proves my point again.

Not at all. I have shown many "discount brokerage" listings to clients. What I will say is that the vast majority of those listings are overpriced - comes with the mindset of the sellers who choose such services. Consequently very seldom do my clients choose to make an offer on such properties. Additionally, I have a written "Buyers Agency" agreement with my buying clients which specifically states the terms of the agency and what I will be paid upon successfully doing the job, be it from the proceeds of the sale or otherwise, so I am only interested in doing what is right for my client after having agreed to the remuneration. At the end of the initial meeting that agreement is handed over to them with the recommendation they take time to read it over and if they wish to use me as their agent and bring it back to the next meeting before we proceed. Haven't had anyone say no or not show up to the next appointment, but then we haven't met yet have we? No conflict of interest, no breach of ethics and a lot less potential for either.