2.99% interest rate. How much lower can it get?

http://www.vancouversun.com/business/lock+Pondering+merits+rate+financing/6025780/story.html

In 1991, my very first clients secured an excellent rate of 13.5%.  Over the years, I've heard economists, consumers and financial experts say "it can't get any lower" when rates dropped past 7%, 6%, 5% and even the 4% in the not to distant past.


There are some who believe that high inventory, low rates and uncertain global economy will translate to plummeting prices but Victoria market fundamentals have always proven those to be incorrect assumptions.


I'll never forget a gentleman I met about 10 years ago:  he wanted to sell his house because he felt Victoria prices would drop 50% in the next 6 months.  Another agent sold his house and he ended up in the rental market only to watch prices DOUBLE in the 5 year span of 2002-2007.  He effectively removed  himself from an upward moving market and had to repurchase at a drastically higher price.  I would call that a massive error- the economists and opinons he believed in betrayed him!

Last night I had a chat with Ken Strattford, www.businessvictoria.net who mentioned an article last week written by an economist in Florida who was quoted saying Victoria Real Estate prices will drop 60-70% in the next 12 months.  What?????  I'm not sure where he's getting this idea:  we have the lowest vacancy rate in Canada, strong annual net migration of 3500 or so persons, and have a diverse economy including Government, Tourism, Military, Universities, Lifestyle (weather) and a growing Technology sector. 

I need to find this Floridian economist and invite him to a game of blackjack.  I may be totally unskilled at gambling but with a guestimate like his I'd stand to make some money!

Weekly stats, January 16 2012 (Video)

Victoria Real Estate Board weekly stats

Weekly Victoria Real Estate stats: Jan 16 2012

Monday, January 16, 2012 8:00am

	MTD	January
	2012	2011
Net Unconditional Sales:	154	339
New Listings:	497	1,187
Active Listings:	3,428	3,283

There's lots of activity out there, even though the numbers may not give that impression.  Looks like we will (again!) exceed last year's sale figures but the dusting of snow we've had has definitely caused a few rescheduled appointments or delays in activity.

We are fielding many calls from owners who put off listing their home for sale in 2011, being ready to go now.  As a result, the inventory for January will again be high- many options for those looking to buy!

Tips on selecting an agent

There are 1300 Real Estate professionals serving Greater Victoria.  Here are some pointers on how to find the right person for you:

·         Do you feel a connection with the agent?

Buying or Selling a home is a complicated process.  Does the agent give you the sense of competence, experience and knowledge?  Do you feel you can trust this person and does rapport exist?

·         Is he/she a Buyers Agent or a Sellers Agent?

Most agents do both.  But many specialize in exclusively working with buyers or with sellers.  Be sure to ask.

·         Does the agent have recent experience in this price range and market area?

An agent who specializes in condo sales may not be able to provide valuable advice on commercial properties or vice versa.  A true professional will explain their scope of expertise.

·         How accessible is the agent?

If you require someone who can respond quickly to emails and text messaging, you need to determine in advance how the agent handles contact from you.

·         What are the agent’s previous successes?

Testimonials from recent customers is a great way to gauge the agent’s dealings with other people.  Good agents keep testimonials and often will provide contact information for you to speak directly with previous customers.  You do background checks on employees or tenants- why not on your agent too?

If you are interviewing agents to serve you, please add us to your list.  We’d be pleased to show you our results with buyers and sellers and demonstrate how we can help you reach your Real Estate goal.     

info@tonyjoe.ca

250-370-7788

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Arbutus one level home

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One level home in the Arbutus area.

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ASSESSED VALUE: TRUTH OR FICTION?

Whenever dramatic changes occur in our Real Estate Market, one of the most hotly debated topics among consumers and Real Estate professionals is the applicability of a property’s Assessed Value (referred to as ‘AV’ in this article) relative to pricing in the open market.

The double-standard relating to AV is just amazing.  People want their AV to be as low as possible while living in their home, the idea being that lower Assessment means lower property taxes (FYI mill rates determine this, not necessarily the AV).  When they want to sell, they want their AV to be high as it reflects well on their asking price.

Human nature has it that a consumer generally wants to sell for higher than AV but come time for that exact same person to purchase they want to buy below Assessed Value.  We hear arguments daily from agents commenting on pricing as it relates to AV, usually at the time an offer is being presented.  “Homes in this area are all selling below AV”, said an agent to me recently.  Strange, I couldn’t help but notice her own listing in the area was listed $120,000 above AV!  When confronted about this discrepancy, her defense was “…the house has been totally renovated…”.

Therein lies the true issue with using Assessed Value to determine pricing.  When was the last time an Assessor actually visited the property noting all of the upgrades and value enhancements to the house?  Virtually all (at least 90%) of the homeowners I ask have tell me they’ve never had anyone from the British Columbia Assessment Authority (BCAA) through their home.  One client had owned their house for 42 years and never once had such a visit!  So how is the AV established?

Generally, BCAA takes the last sale price of the property and adjusts annually based on increases or decreases in the marketplace.  Permits taken out for renovations at the Municipality are also accounted for.

Problem is, many homes have had cosmetic upgrades and redecorations which would not be known to the BCAA since they neither have access to a permit nor have visited the property.  The ensuing effect is that Assessed Values are all over the map, being higher or lower than eventual Sale Price with little or no pattern or justification.

As a Home Buyer, would you pay a Seller a price based on AV?  Of course not.  You would survey recent sales history in the area to determine a true market value.  Market Value is what consumers are willing to pay for properties at a given time.

The bottom line is that the Assessed Value is useful for Municipalities to fairly determine annual Property Taxes but mean little, if anything, to a Buyer or knowledgeable Agent at the time of purchase.

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Perfect family townhouse just around the corner from UVIC, schools and close to shopping and amenities.  Quality built in 2004 and well kept.  Call us for more info at 250-370-7788 or info@tonyjoe.ca.  A sound investment with rental ability as well!

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