The Dregs and an HHV Update

A few weeks ago reader Barrister commented that not only is inventory low, but much of what is listed are actually just the dregs.   Those houses that are overpriced for the market and merely represent wishful thinking or fishing expeditions by the sellers with no real motivation to sell.   Of course those properties exist in both slow and active markets, but assuming that the number of sellers that are either deluded or out fishing remains more or less constant, one might conclude that with such low inventory the dregs represent a greater percentage of the active listings than usual.   Let’s take a look.

What constitutes a stale listing?   I’d say in this market anything that’s been on the market for over 3 weeks.  Any commodity house that’s priced right should sell more quickly than that so those that linger are overpriced and at best will have to drop their prices or wait for the market to catch up.

Out of over 1000 properties on the market, the majority are actually just the dregs sitting on the market for sometimes years in the vain hope they will be sold at unrealistic prices.   Of course luxury properties would be expected to sit longer so not all of the dregs are necessarily overpriced.  On the other hand you have to keep in mind that a good chunk of the 364 properties that have been on the market for less than 3 weeks are overpriced and just haven’t sat long enough to qualify as dregs.   The common trick of relisting stale properties means there are probably fewer than 300 serious sellers of residential property right now.   

Narrowing in further to condos vs detached, we can see that a greater proportion of single family homes fail to sell promptly, which makes some sense as they are harder to price correctly and there are more luxury houses that sit on the market.

Any way you slice it, once you take a look at what is realistically for sale out there, you can see why people are having a hard time.   We need more inventory to come on to the market and that has to come either from new builds or people leaving the region.   Given the latest population numbers from the census it doesn’t seem like we will get much help from the latter.


HHV Update:  How did I do this analysis?  Well as you may have suspected I have managed to become licensed as a used house salesman REALTOR®.  What does that mean for House Hunt Victoria?   Will it devolve into just another boring sales blog for houses?  Nope.  I have a full time job that I’m quite enjoying and am not intending to leave for the time being.  I also have zero interest in carting buyers around and twiddling my thumbs at open houses.   So why the heck get licensed?   Here’s why:

  1. More data.   While I appreciate how open the VREB is with their public data, there is a limit to what can be done with what is published.
  2. Opportunity for more automation.  I have some very crude tools for automated market analysis over in the market summary, but I think there is much more potential in this area to increase the information available to the general public.   Being licensed allows me access to the data feeds that can be consumed by web tools and turned into interesting visualizations.   My goal has always been to provide evidence based market analysis and the more transparent the data, the less people will be misled by the industry spin.   If you think the information I’m presenting is one sided or biased in some direction, please let me know and I’ll correct it.
  3. Explore alternative business models.  Why can’t you easily hire a real estate agent just to write up an offer?   Why is much of the business stuck in 2003 as far as information tools go?  How can we correct the information asymmetry that exists in the market and bring more power to the people (MREGA?)  My goal is to find some way to tackle some of these without introducing conflicts of interest.   The market already has more than enough of those.

What do you think?  Big sell out?   What kind of tools or information is missing out there?

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142 thoughts on “The Dregs and an HHV Update

  1. In BC, the public can now access that information through an online title search that includes the declared value of the property. They have to pay a fee for the service but the same would apply if they were getting the data from the board.

    Since there already is a system available to the public, I don’t see why it’s necessary for the real estate board’s in BC to duplicate the service.

  2. “I suspect their board is more permissive with the data”

    You are probably right that the boards have different rules. I know there were lawsuits in Ontario about who should be able to see what data.

    A similar result might be achieved here by ingesting the data already made public by realtor.ca (the listing details, dates, selling realtor, etc.) and by the provincial property assessment website (sales price and date). Or maybe I’m out to lunch. I do know that I miss that information.

  3. Certainly someone in this fertile tech startup city can mimic what a company in Nova Scotia did a few years ago

    I suspect their board is more permissive with the data. During my reading of the VREB regulations on use of their data feed, this kind of site would not be permitted.

  4. The issue of information being withheld from the public (sales history, fake new-listing date) to make using a realtor necessary is solvable. Certainly someone in this fertile tech startup city can mimic what a company in Nova Scotia did a few years ago. They collect all data available on property listings, sales, and assessments, and provide it to the public on the web (www.viewpoint.ca).

    These days every potential home buyer can look at the data no matter if they have a realtor or not. Want to know what that property sold for 5 years ago? The data is there. Has it been de-listed and then re-listed the same day? The data is there.

  5. I doubt anyone on here can be classified as anything but working middle class +-.

    Pretty sure you are off on the middle class thing Dasmo.

    Middle class by income is a family income of $61-88,000/year. Many, if not most, posters here are above this level. Plus several posters are retired.

    Middle class family net worth falls between $283-489k. Depending on how long you have owned a home and whether or not you have a pension your net worth may be below this despite an above middle class family income.

    http://www.macleans.ca/economy/money-economy/are-you-in-the-middle-class/

  6. Property Kings? Careful what you wish for. These prices combined with more and more regulation and taxation will create exactly that. HPO is a fine example. These things won’t lower the cost but rather increase the barrier to entry such that there will only be property kings and the serfs that rent as it has been for probably most of our time on earth. I doubt anyone on here can be classified as anything but working middle class +-. I think these prices are messed up and I know there is big profit being made in the new spec homes being built. The only real way to stop it is to stop giving the money out for nothing. Not that I want that, but that’s the truth.

  7. Garth laid out all the new house taxes coming. I’m sure the property kings will be bitching for years to come.

    Er, the only change to taxation is a possible one which will affect the capital gains inclusion rate and which was already discussed here.

    Capital gains have always been payable on property that was not eligible for the capital gains exemption for a primary residence. There is no change.

    And as far as “property kings”, if you mean people with a family home with a suite, the requirement to report will probably mean some will pay capital gains on a % based on floor space used for a suite. Also already discussed here in detail.

  8. “Sunnymead has always been very pricey.”

    True. I’ve never really understood the appeal of Sunnymead and Broadmead, other than that they were obviously designed as exclusive, affluent neighbourhoods (Broadmead especially, which I think was designed by the same people who did the British properties in Vancouver). I find Broadmead to be really dark and Sunnymead to have a suburban, cookie-cutter, boring planned community feel to it. But I guess that’s what some people want.

  9. Seems like there’s always at least one or two units at 770 Fisgard for sale at any given time. Is there any reasoning behind this, is it a shitty building or something?

    Developer is still slowly selling off units they rented out initially. I’ve sold a few units in the Hudson and I like it especially if the entire area being re-developed in the next 2-3 years.

    The sunnymead is my WTF one of the week. That was a 500k one a few years ago I would think. That is over 525 dollars a SF, that has to be a record for that area by far.

    Sunnymead has always been very pricey. That would have been low 600s a few years ago. Certainly not 500k.

  10. Seems like there’s always at least one or two units at 770 Fisgard for sale at any given time. Is there any reasoning behind this, is it a shitty building or something?

  11. Trudeau already pissed off the millennial and gen x’ers flipping on electoral reform. He won’t piss off the boomers with any housing taxes.

  12. Garth laid out all the new house taxes coming. I’m sure the property kings will be bitching for years to come.

  13. Anyone besides me weep for all the poor realtors who don’t have houses to sell? Hope they don’t default on the their mortgages. I know that sounds sarcastic but not intended that way.Some of my best friends are realtors.

  14. Crestview was last purchased for $895,750 in March 2015. (Its current assessed value is $1,298,000.) It has obviously had some serious renos but a sale price of $2,180,000 means that the owner made an outrageously huge profit off that house in less than 2 years.

  15. What is or is not a dreg is a personal opinion.

    A two bedroom house in Oaklands is a dreg to me but it may not be to many people on this blog.

    But has the typical house that people are buying changed? Are people buying older, smaller houses on smaller lots than last year?

    This time last year the typical property people were buying in the core was a 1961 built home having 2,191 finished square feet on a 7,405 square feet lot.

    This year they are buying a 1958 built home having 2,290 finished square feet on a 7,800 square foot lot.

    Not really a significant change.

  16. Let’s take another look at Leo’s current post:

    “Out of over 1000 properties on the market, the majority are actually just the dregs sitting on the market for sometimes years in the vain hope they will be sold at unrealistic prices.”

    That’s why just looking at the number of active listings doesn’t tell the whole story.

    After several years of “dregs” accumulating in number, if the total # of listings remains stable, the dregs become a higher % each year, and then there are actually fewer new good choices than previous years.

    “there are probably fewer than 300 serious sellers of residential property right now”

  17. Then how about some real facts and not unverifiable anecdotes.

    Active listings have remained stable for the last year while the number of house sales in the core have been declining since April. Last month was the highest month of inventory for houses in the core since February 2015.

    That’s two years.

    January’s 3.6 months of inventory is far from last April when it bottomed out at 1.06 MOI. And while some price ranges and neighborhoods are still having shortages the market has improved with actively participating buyers having more selection and more time to make an informed decision.

  18. The January before there had been 122 house sales in the core. That’s a 32% decline from the year before.

  19. Vancouver had the same conditions last summer then the hammer fell. Sales are down from last summer and last Feb so how is that not facts ? The cracks are showing no matter how you spin it.

  20. Hawk

    Just trying to deal in Facts and actual market condition being faced by buyers. Not wishful hoping/praying or whatever you call it.

  21. John Dollar’s (aka JJ) favorite thing to do is try to scare & manipulate with his access to the board’s data.

    An example from last month:

    January 25, 2017 at 3:48 pm
    Despite there being almost 300 activing house listings so far this month, there have only been 62 house sales in all of the core districts of Oak Bay, Saanich East, Saanich West, Vic West, View Royal and Esquimalt!!!!!!! House sales are down by 35% in the core from last January!!!!! YIKES!!!!! Could this be the start of an economic recession?

    Meanwhile, core house sales came in at 92 last month and the median price showed a jumped of 3.0% from Dec.
    http://www.vreb.org/media/attachments/view/doc/statsrelease2017_01/pdf/January

  22. Keep pumping gwac, Mike needs a break. Facts are showing declining sales and job growth is down from last summer as well. First volume then prices just like Vancouver. 😉

  23. I have no frustration except with manipulating numbers in order to again prove how wrong you have been for years Lets see where the month ends in sales and prices. Tell your friend Hawk that it is not a 75% decrease since he is using a MTD number over a monthly number. More manipulation…

    https://www.youtube.com/watch?v=EwYHqqVZCRg

  24. We might project 130 to 150 house sales this month down from last year’s 228.

    And in some price ranges there is a shortage of listings relative to sales that may lead to some irrational buying. But that’s only temporary. Every time a fool over buys that’s one less fool in the market.

  25. “But what has changed – is the number of sales. There are 49 house sales so far this month. Last year there were 228.”

    Wow, that’s like 75% decline in sales, I thought Victoria was booming gwac ? . Looks like you’ve been practicing Mike’s fake news storyline without checking the facts but why am I not surprised.

    Those who protest the loudest say the least. I post the real news from real sources, not out of my ass like yourself.

  26. And how about all those wealthy Vancouverites?

    By this time last year there were 16 houses sold in the core to people from Vancouver. Since January 1 of this year there have been FIVE.

  27. Thank you I stand corrected we have no inventory issues. Lots of choices out there for everyone looking. I guess that’s what leads to someone paying 900k plus for a 1700 bungalow in Sunnymead.

    It is like the twilight zone on here from reality out there sometimes.

  28. Low inventory? Low relative to what? To December? To January? to last year?

    Right now there are about 288 active house listings in the core. That’s close to the same as last month at 294 and more than the month before at 271.

    How about the last 15 years! There have been years with lower active listings in February inventory in 2003, 2004, 2005, 2006, 2007 and 2008

    For the last 12 months the number of active listings hasn’t changed much ranging from a low of 271 to a high of 418. Average number of active listings over the last 12 months was 321. Active house listings in the core have stayed fairly steady for the last 12 months.

    But what has changed – is the number of sales. There are 49 house sales so far this month. Last year there were 228. But that’s to be expected since the median asking price has gone from$720,000 to almost $832,000 in that time period.

    That adds about another $400 a month to conventional mortgage payment.

  29. GWAC:

    The “fact” that you are not dealing with is that HAWK IS ON A MISSION FROM GOD AND FACTS DONT COME INTO IT.

  30. Hawk the only thing you are hunting is more articles trashing the housing market. Really hope no one has followed your advice the past few years.

    Lets deal in facts

    Low inventory
    prices still rising
    Economy is strong in Victoria.
    Interest rates are stable.

  31. gwac, that’s hilarious. Homeowners with no intention of buying come here to obsess over their paper profits or FOL (Fear of Losing) while the blog is called “House Hunt”, not “House Owner OCD”. There’s HGTV for you diseased types. 😉

    Bearkilla now scrounging at the dump is definitely a sign the end is near.

  32. Bear

    I spit out my coffee with that one. Maybe a gofundme account for Hawk to buy a house. I would throw in a 20.

  33. Agreed Hawk this is a sure sign of impending doom. I talked with someone in the lineup at the dump last week and he said he was there looking for scrap and he lives in a million dollar home in Fairfield. It’s habbening.

  34. The sunnymead is my WTF one of the week. That was a 500k one a few years ago I would think. That is over 525 dollars a SF, that has to be a record for that area by far.

    I think Hawk has real-estate PTSD. You can get help, Be strong.

  35. You forgot about the other 20 plus price slashes I posted the last few weeks in prime areas and the dozens more I didn’t.

    When Bearkilla strains himself to write more than one convoluted sentence you know the hardcore bulls are sweating it. Just like Mike saying the Vancouver tank is over, it’s just getting started. 😉

    Steve Saretsky ‏@SteveSaretsky 1 hour ago

    REBGV townhouse sales down 41% through 13 days of February. #VanRE
    condo sales down 25% through first 13 days of Feb. Again year over year.

    Through first 13 days of February- REBGV detached sales down 59% year over year. #VanRE
    fewest sales in Van West Detached on record Might want to check that out

  36. What does it all mean? TWO price reductions on one property in the fairfield and then another massive price slashing in fairfield. Then a massive high price is fetched for a shitbox rancher in the horrific sunnymead boonies. I think what we have here is what’s known as the calm before the HUGE MASSIVE crash all the bears have been waiting for. This is the one where the house prices go to zero guys.

  37. No wonder the OSFI is telling banks to get some serious protection in order. Trumponomics is scaring the international bond investors bigtime. Rates could rise very quickly.

    U.S. debt seen as a risk? America’s biggest creditors dump treasuries in warning to Trump

    “In the age of Trump, America’s biggest foreign creditors are suddenly having second thoughts about financing the U.S. government.

    In Japan, the largest holder of Treasuries, investors culled their stakes in December by the most in almost four years, the Ministry of Finance’s most recent figures show. What’s striking is the selling has persisted at a time when going abroad has rarely been so attractive. And it’s not just the Japanese. Across the world, foreigners are pulling back from U.S. debt like never before.”

    “Yields are going to be in an uptrend,” he said.

    http://business.financialpost.com/news/economy/u-s-debt-seen-as-a-risk-americas-biggest-creditors-dump-treasuries-in-warning-to-trump

  38. “While job creation in the Victoria CMA was strong in the third quarter, it highly favoured part-time workers. At the end of September 2016, the year-over-year employment gains were 6,300 part-time jobs and 1,900 full-time jobs. Typically part-time employment is expected to support rental housing demand more so than the market for homeownership.”

    Great points Local Fool. Mike has a habit of spinning the facts like that Spicer guy. As he’s maxed out to the hilt and seeing Vancouver tank we can expect to see more of his “you were wrong 3 years ago stuff.” and his lame charts.

    Bears only have to be right once and the last 5 years of profits can be wiped out in 1 year as past booms and busts have shown.

    Over-speculation ya think ?

  39. @ Michael,

    You’d be an interesting person to meet in real life. For a little while you were actually writing a few rebuttals on here that were thought provoking. Then just as quickly you seem to write things that just come out of the twilight zone. I alternate between “okay, that makes sense”, to “what planet is this guy broadcasting from?”

    And if you think now is a good time to buy Michael, go for it. Right now a speccer is likely to make a few bucks…or more. But for the rest of you who want to buy a house to live in, here is an excerpt from the CMHC’s HMA for Q1, 2017:

    “One of the key measures assessed by the framework is “price acceleration”, which is detected when price growth exceeds normal market changes on a persistent basis. Researchers have shown that this indicator can be a sign of excessive levels of speculation.

    With price acceleration now detected in Vancouver, Victoria, Toronto and Hamilton, home buyers should be prudent and ensure that their purchases are aligned with their needs as well as the long-term market outlook.

    While job creation in the Victoria CMA was strong in the third quarter, it highly favoured part-time workers. At the end of September 2016, the year-over-year employment gains were 6,300 part-time jobs and 1,900 full-time jobs. Typically part-time employment is expected to support rental housing demand more so than the market for homeownership.”

    https://www03.cmhc-schl.gc.ca/catalog/productList.cfm?cat=192&lang=en&sid=4r7mLr2SRFJbAA6m8CLDKj2jNDSatQ1uJKLbAcwNoSyOkhSXbDIEKQ49XIt4Zl1Q&fr=1486965166724

  40. Let’s not forget the banks are about to go on the defense as the last of the sheep get fleeced.

    ‘The housing bubble has burst’: Economist warns market imbalances are threat to economy in long run

    ““The largest banks are now being strongly advised by OSFI, the federal banking regulator, to bolster their working capital base for their own protection,” write Madani.”

    http://www.vancouversun.com/housing+bubble+burst+economist+warns+market+imbalances+threat+economy+long/12887647/story.html

  41. Yep all those thousands of part time jobs are going to qualify for mortgages as banks tighten the noose. Pump it up Mike ! 😉

    OTTAWA — The national labour market unexpectedly added 48,300 jobs last month thanks to surges in part-time and private-sector work, Statistics Canada said.

    Looking back 12 months, Canada gained 276,100 net new jobs overall with the addition of 86,200 full-time positions and 189,900 part-time jobs.

  42. 1234 Richardson is a total crap box – therefore the price reduction.

    No, it’s a sign of the apocalypse. Or whatever.

  43. I don’t think my cell phone is registered with any federal agency. It is registered with bc medical. I think a lot of people are the same now. I also don’t accept telephone messages as I find it cuts down on annoying callers and people who know me text. If I was away for the census period I’d have been unreachable by those methods. But I think this would be unusual.

    I believe the data on vacant houses is not a reliable indicator of homes that could or should be added to the rental market and the census methods are better than the stats can website indicates (tx for the info!), but even more, the empty home tax is going to be expensive to administer and ineffective and the public probably would not support it if they understood this.

    I’m open to a relocation package – is gen x getting the boot too?

  44. Hey Michael,

    Re: “I’d say the correction is pretty much over.”

    It appears Rich (http://www.robchipman.net/) is lumping condos, townhomes and SFH’s together in his figures? That kind of skews the stats because there’s 3 different markets going on right now in Van, with condos doing great and SFH’s floundering. I think it would be more accurate if he looked at each category individually.

  45. Phenomenal jobs number for January. This is shaping up to be another hot Spring.

    Employment rose by 11,000 in British Columbia last month, continuing an upward trend that began in the spring of 2015, Statistics Canada said Friday (February 10). In the 12 months to January 2017, employment increased by 82,000 or 3.5%, the fastest growth rate among the provinces
    https://www.biv.com/article/2017/2/bc-adds-11000-jobs-january-statistics-canada/

    Congrats on your licensing Leo.

  46. @totoro
    Telephone #’s for the census are gathered from various other government sources as are secondary addresses etc. You pay taxes either property or personal and that information is there. Also in cases where there is a change of number time is spent searching for new numbers but usually it means that the ares supervisor has to keep sending out enumerators for the full period of collection, usually twice a week in most areas. In the case of empty homes searches are done to see if the home is for sale MLS listings etc. The only time the home is considered unoccupied is if there is evidence that there is no one living there, no furniture inside, no window covering, no hydro bills or the property is managed by a company holding the keys who informs the census that the property is currently unoccupied.

  47. Just my opinion but I think 1234 Richardson is OK – a tad small but it’s a 55×150 lot, 1140 sq foot main level, 7′ basement. Priced below assessment. The only disadvantages are that it’s a slightly busy road (although only a secondary feeder route), and on a T intersection. In Vancouver, a T intersection made it harder to sell – don’t know if it’s the same in Victoria now.

    You’d think that a flipper would have pounced on it by now (?) but maybe there’s something I’ve missed, eg., something on the property, basement, etc

    Luke, agree that previous generations have been lucky in the housing market – having said that, they weren’t encouraged to rack up debt like people are now (I was just talking to a young guy who put a $70k luxury SUV onto his mortgage/LOC).

    So the fed/provincial gov’ts (with low interest rates & lack of vision for economies of the future), inexperienced city council members, & tiny condo developers have created the mess we’re in now.

    That’s why I want the focus to stay on solving issues with zoning, transportation, and homes appropriate for families (not on seniors who haven’t had any part of creating this mess, no matter how friendly the bunnies are 🙂 )

  48. 4664 Sunnymead Way sold for $910,000. I’ve been keeping an eye on Sunnymead, although it’s near the bottom of my list of potential neighbourhoods because it’s pretty far out of the way for me. That house (a 1700 sqft rancher) just sold for an outrageous amount of money compared to what I was seeing for the same type of thing last year. It’s on a 10,000 sqft lot, which I guess is something, but still.

  49. @ Totoro,

    “Middle age has arrived.”

    Watch out. There some here who’ll be clamoring to have you shipped off to a Texas bunny ranch pretty darn soon.

    Though I suppose, depending on the kind of bunnies, that might be fun.

  50. Are you an agent on the side too Luke ? There were many reports on here of government workers with agents licenses milking the system while moonlighting on the tax payers tab. You seem to be at every open house and listing. One man’s crap box is another man’s treasure as they say and many are overpaying by $500K for their crap boxes. 😉

    Funny how those who got lucky in Van and came here are now authorities on the subject.

  51. @ Inspector:

    While I agree in principle it isn’t legally possible. The uplands review committee is in place because of regulations that were put in place many years ago (before current provincial regulations). The remainder of Oak Bay is governed under provincial regulations that don’t permit the municipality to affect the design of the building.

    Interesting, and slightly depressing.

    Wonder if we’ll see folks putting up yurts as low-cost alternatives to conventional frame construction. Or maybe geodesic or air-supported domes.

    But at least OB could put an end to Maxed-mansions by modification of floor-space and lot coverage ratios.

  52. 1234 Richardson is a total crap box – therefore the price reduction.

    What I found really interesting was this new listing – 192 Bushby St. – in an incredibly desirable location steps to Dallas Rd beach, being reduced already! Hawk should’ve been all over that one. Only on the market six days and already ‘slashed’ (as he would put it) from $989k to $948k
    That said, Bushby also looks like it totally needs updating.

  53. Thanks Barrister for that comment re. my supposed sense of entitlement. Not knowing me shines through, as no one who knows me personally would ever say that.

    However, I do ‘get’ how those in your generation (you said you were 80?) would see those in my generation – under 45’s and esp. the millennials as being like that. Many are still living in their parent’s basements playing video games – and they will eventually reap whatever reward they get from that.

    A little about me: I started working at age 15 (and had paper routes since age 10) – I was raised by parents who were 20 years older than everyone else in my generation (they started really late – people used to ask if they were my grandparents). My mother, for instance, lived through bombings in WWII England. Most of my compatriots parents were hippies in the 60’s. I bought my first house with my partner at age 23 in the suburbs of Vancouver – Now at age 38, we have now built up over a $1 million in equity and live in North Oak Bay. Now, I work in public service job so I have an alternative pension should the Fed Gov’t ones not be there when I retire. I’ve taken care of myself, it’s others in my age group I voiced concerns about.

    My point about talking about how the Baby boomer generation (and those older – i.e. your generation) have had the most opportunity is that it’s just reality. You may have worked hard during your life, but you also just got lucky with timing and you can’t deny that! Every individual’s situation is different, and some are luckier, or smarter, than others. My point is, now – many of the younger folk face challenges your generation didn’t, and that is just a fact, and there does need to be some more attention paid to that than there is. It seems, because seniors are the one’s who vote (and by the way, unlike many in my generation – I do vote) they are paid more attention.

    I don’t think wealthy senior’s deserve an additional subsidy from taxpayers on their home owners grant. I also disagree with the Gov’t raising the subsidy to $1.6m – thereby giving everyone wealthy more of a subsidy. But in the end, that’s small potatoes – and it’s the empty homes and zoning issues (leading to the chronic housing shortage problem we have here) we should really be dealing with. What should really shine through about me is that I actually care about the plight of others, and am not just concerned about myself.

    And, Victoria can hardly be compared to Malibu or Carmel – these are just little enclaves for the uber-wealthy – not a diverse city like Victoria is. I have been to both places and Victoria compares more to Halifax than those places (and Halifax has far cheaper housing).

  54. Researchers said that the City of Van/BC Hydro vacancy report also had a lot of weaknesses – it missed a high% of empty homes. (remember that Van had a lot of homes being torn down) As SFU’s Andy Yan has said, “offer the underlying data from the report to accredited researchers, not only for transparency and accountability, but to conduct their own analyses with other data sets to hopefully add context to the issue.”

    Poking holes in Vancouver’s housing vacancy study
    http://www.theglobeandmail.com/real-estate/vancouver/poking-holes-in-vancouvers-housing-vacancy-study/article29181730/

    “The author of the study, Bruce Townson, is frank about the study’s limitations – and there are several … ” (that Townson himself pointed to)

    “Houses that had the electricity turned off – such as old houses that sit empty as they await permits for demolition and redevelopment – were NOT counted in the study. They were only counted after electrical service had been restored for a full year.” (I saw for myself the huge numbr of homes being torn down & re-built)

    “Many newly built houses were also exempt. They too were only considered empty once the electricity was turned on, and remained on, for one year.” (Again, the ghost town neighbourhoods)

    “Houses that only have visitors during summer months were counted as occupied.” (I lived in a neighbourhood where people came from overseas to live in houses only during July/August)

    “Houses that sit empty but have a caretaker come by and generate electricity use at least five times a month were also considered occupied. And a house with the lights on timers and a housekeeper or maintenance person who comes by and uses the electricity, were also counted as lived in.” (that’s why Yan wanted to use more data than just BC Hydro)

  55. May 10th through to the end of July

    Good to know. I guess in some cases people would have been away for three months but that is fewer than those away for one month.

    How does the census get its contact numbers for a household like ours which does not maintain a land line and did not live in the same home for the previous census?

    What happens if the contact number you are using is not in service or leads to someone who has moved?

    In any event, the deeming of homes to be unoccupied if they are occupied by someone with another residence in Canada or abroad, such as is the case with Canadian students, kind of defeats the legitimacy of the numbers of “vacant homes” being bandied about by the media and politicians. In a student town like Victoria this is particularly misleading.

    A better identification might be through hydro records, although who knows with that because some heat water and space and cook with natural gas. The survey they did in Vancouver based on hydro records indicated the percentage of unoccupied homes has remained steady since 2002 – for 14 years – or about 4.8% for all housing types and that 90% of them were apartments and condos, many of which did not permit rentals.

    http://vancouver.ca/news-calendar/city-releases-comprehensive-study-on-empty-homes.aspx

  56. “I’d say the correction is pretty much over.”

    You said that last month Mike then it tanked $100K AKA bull trap sucker. Anymore fake news ?

  57. Fairfield getting price slashed $45K at 1234 Richardson St. Looks like the third price slash. Peak Victoria in motion. Maybe they just need a mere listing. 😉

  58. Sudden surge in new listings in most metro Vancouver neighbourhoods in January

    New lists actually fell 7% y/o/y:
    New listings for detached, attached and apartment properties in Metro Vancouver totalled 4,140 in January 2017. This represents a 6.8 per cent decrease compared to the 4,442 homes listed in January 2016

    Feb’s first 8 business days for Van’s sell/list is also hopping.

    41%, 63%, 100%, 53%, 67%, 91%, 82%, 73%

    http://www.robchipman.net/

    I’d say the correction is pretty much over.

  59. @ Toro “Non-response follow up is a telephone call for the 2016 census. If you were away all May and did not respond your home would likely be deemed unoccupied for the census. If you refused to respond you can be fined. Not being there is treated differently.”

    This is not correct. I worked for the census at the call centre in Victoria and the follow up calls went on from May 10th through to the end of July. If you did not respond to the census form then you would receive many calls both over the phone and by enumerators at the door until the census form was completed. So you would have to be away for three months not to be included. The 2016 census was far more thorough than the previous one.

  60. Mario is a valuable contributor here

    I’ll take Mario….when I was born my parents came down to two names; Marko and Franjo.

    Dodged a bullet there. While Franjo is easy to pronounce in Croatia would have been interesting here.

  61. CS: “and subject all building permit applications to review by an architectural committee to determine consistency with the character of the surrounding properties”

    While I agree in principle it isn’t legally possible. The uplands review committee is in place because of regulations that were put in place many years ago (before current provincial regulations). The remainder of Oak Bay is governed under provincial regulations that don’t permit the municipality to affect the design of the building. The only exception is when an owner/builder asks for a variance of some description. Then Oak Bay gets to put in their two cents worth. This is the same throughout the province (except for the City of Vancouver that has it’s own charter).

  62. “That’s quite the Vancouver slowdown. How long til it spreads to here?

    Well, since Vancouver’s situation is nothing like ours, I’d say pretty fu**ing long.”

    That’s pretty fu**ing funny, when you praise the Asian inflow in Vancouver having the ripple effect here, but then when they are leaving to Seattle and all points east there isn’t a peep.

    It will hit you between the eyes when it happens and won’t be long. You chop off the head of the snake of their money flow and look what happens.

    I see there are many rents being slashed in prime areas as Peak Victoria hits reality. Landlords who are used to gouging are finding out the renter is not paying for his vacation to Hawaii any longer.

    China’s Yuan Outflows Plummet, Showing Capital Controls Pay Off

    https://www.bloomberg.com/news/articles/2017-01-20/china-s-yuan-outflows-plummet-showing-capital-controls-pay-off

  63. I feel like the VREB is going to sue you when you release all this information. I assume you’ve looked into this.

    Yes. There are definitely limits to what you can put on a public site. Aggregate data is ok as far as I can tell from the data feed terms of use and speaking to the VREB. They know about this site and I plan to keep them apprised of plans. Only way it can work.

    Any data that is listing specific beyond the basics would have to be on a private client site where you would need a login and there is some required vetting.

  64. By the way, I heard speculation that the City of Victoria council is planning on solving the inventory crisis by culling seniors.

    Let’s send our seniors to a sanctuary in Texas.

  65. Re: “the two flat roofers by the same builder just South of the Uplands”

    But then, come to think of it, those two flat roofers are actually in the Uplands, and they look like Hell. Obviously Oak Bay needs a better architectural review panel — and a deer catcher.

  66. A lot of flat-roofers are designed by architects. Many curious design elements are often due to bylaws (and their lack of flexibility).

  67. By the way, I heard speculation that the City of Victoria council is planning on solving the inventory crisis by culling seniors.

    We can’t even cull deer.

    They force you to stretch it over 10 weeks though. Total cost about $4k.

    $4,000? That’s serious, Leo.

    Mario – I have recommended you to many people.

    Mario is a valuable contributor here.

    That’s quite the Vancouver slowdown. How long til it spreads to here?

    Well, since Vancouver’s situation is nothing like ours, I’d say pretty fu**ing long.

    So it will take some time before I can get the automated tools programmed so that we can get this info on the site.

    I feel like the VREB is going to sue you when you release all this information. I assume you’ve looked into this.

  68. “then you have to go back and forth with an architectural committee 2-3 months”

    That’s not an unreasonable penalty to pay if it eliminates truly ugly new houses such as some of those that have gone up recently just south of the Uplands. And the financial cost of such delay doesn’t substantially alter the economics of building a house. Moreover, any actual cost incurred as a result of the architectural review would be offset by the increased value of the end result due to the fact that you haven’t built a winning entry for Oak Bay’s Ugliest New House of the Year contest.

    The Flash house with the flat roof in the Uplands is actually not bad now the landscaping is complete, although there is a curious inconsistency in the height of windows and exterior cladding along the Norfolk Road side. The end result is, anyway, vastly better than the two flat roofers by the same builder just South of the Uplands.

  69. 15% increase in Vancouver:

    http://vancouversun.com/news/local-news/census-counts-25502-unoccupied-homes-in-vancouver-more-than-double-the-estimate-by-city-hall

    Units occupied by persons who considered (or who were deemed to have considered) their primary residences to be elsewhere (in Canada or abroad) were classified as occupied by foreign and/or temporary residents.

    Note this means if you have a second property you have elsewhere in Canada that you have chosen as primary for whatever reason your home is unoccupied even if you live in it 11 months of the year. This also captures CANADIAN students who maintain a primary residence with their parents and rent in Victoria.
    http://www.urbanfutures.com/foreign-unoccupied/

    The Census definition of unoccupied units includes much more than units that are vacant on Census day. In addition to units that were empty (without people or furniture), unoccupied also includes all other units that were not designated as a main residence by a Census respondent and in which there were no occupants on Census day. These units range from the vacant and available for occupancy (including newly constructed units for rent or sale, and vacant existing units for sale and rent), to units vacant on Census day but with occupants on their way (e.g., people moving into a recently-purchased home), to occupied by usual residents who were temporarily away and did not complete a Census questionnaire and, finally, to being full of furniture as second residences for people whose main residences are elsewhere. It is important to note that the Census count occurs on May 10th, after the exodus of many students at the April end of the fall/winter academic term, something that has a significant impact on the number of unoccupied units counted in the Census.

    Which is the same in Victoria.

    the Census provides no indication of the degree to which foreign and/or temporary residents were not Canadian residents or their actual citizenship; no indication of the duration of temporary residency, which could be for as long as eleven months in the case of students who only stay with their parents between school and job; no indication of whether the temporary residents were owners or tenants; and no indication to the degree to which unoccupied units were vacant rather than temporarily unoccupied on Census day

    Unoccupied houses were 9.9% in Victoria in 2011 and 7% in 2016 – a decline in %.

    https://www.cheknews.ca/3400-unoccupied-dwellings-victoria-census-data-show-274666/

    Non-response follow up is a telephone call for the 2016 census. If you were away all May and did not respond your home would likely be deemed unoccupied for the census. If you refused to respond you can be fined. Not being there is treated differently.

    http://www.statcan.gc.ca/eng/ca2011/201101/110013

    Just ridiculous to implement an empty homes tax like Vancouver has. Won’t apply to so many people and those it might apply can just invite a friend or relative or housesitter to stay for six months and it doesn’t apply.

  70. Take a look at mere postings in condo buildings and then compare to what units sold in the same building in the same market using full service.

    Sure, but again the consumer can’t do that check.

    It is in no ones interest to analyze this data as the result are obvious.

    Well it would be in the interests of the mere posting companies. So why don’t they have that data?

    You don’t really need data for something that’s common sense.

    Well clearly something is missing because the vast majority still go for full service. The arguments being made for reduced commission are ineffective. Likely due to the lack of motivation as you say. Why would a realtor think too hard about how to convince someone they should pay less? However from a pure market efficiency standpoint it irks me so I’ll be looking into that.

  71. Look – the census data counts Homes as vacant if no one was there on census day

    Source? Haven’t seen their methodology yet. I believe the census people are pretty persistent tracking people down.

  72. Congrats Leo, hopefully see the real info flow now.

    I have access to the info now, but don’t have time to do the detailed analysis that Just Jack does/did manually. So it will take some time before I can get the automated tools programmed so that we can get this info on the site. Don’t hold your breath, I’m thinking nearer to end of summer, need to put some resources towards it.

  73. On the other hand, some new houses in OB fit in very nicely

    Problem is this is incredibly subjective. Let’s say it takes you 2-3 months to pass the HPO exam, then you have to go back and forth with an architectural committee 2-3 months, then the city permit department. It just doesn’t become feasible to build a home unless you are ridiculously rich, i.e. Uplands.

    and re Uplands there is a brand-new contemporary flat roof house that to me personally looks like a gas station, not sure how it got passed the Uplands committee.

    I’ve heard people complain about the Uplands committee too. For example, in the past they have had retired architects on the committee who don’t like when homes are designed by home designers (way cheaper than architect on average). It’s the type of slight some GPs might have towards nurse practitioners.

  74. “Don’t know if we need this….already becoming impossible to build a home with the owner-builder exam and a bunch of other things that have been introduced in the last 5 years.”

    Marko, the concern with architecture is unrelated to any question about structural integrity. I don’t care if everything built in Oak Bay rots or collapses in short order. What I object to is houses that are totally out of character with the neighboring properties. This is not a problem in the Uplands where all building plans are subject both to public scrutiny and comment, and architectural committee review. But there are some egregious examples of houses inconsistent with the character of neighboring homes elsewhere in OB. On the other hand, some new houses in OB fit in very nicely, for example the house on Musgrave St. recently completed by GT Mann.

  75. If this stat becomes regularly available, it will be interesting to watch the trend in dregs percentage. One might expect inventory to increase and prices to fall with increase in this metric. At least that’s what I expect.

  76. subject all building permit applications to review by an architectural committee to determine consistency with the character of the surrounding properties.

    Don’t know if we need this….already becoming impossible to build a home with the owner-builder exam and a bunch of other things that have been introduced in the last 5 years.

    How about bylaws that make sense? City of Victoria and Saanich are hilarious when it comes to various bylaws. They restrict max square footage of homes but then they allow 20′ ceilings (i.e. the volume of the house increases but not the square footage). If you want don’t want homes to dominate the neighbourhood in terms of size write something up that actually makes sense.

  77. @ Leo S:

    “Let’s just fix the supply side…”

    Yes, I prefer that to being euthanized or subject to a ruinous tax.

    One way to increase supply would be to rezone.

    Almost any house on a larger than average lot in Oak Bay is currently worth several times the cost of building a new home. So if owners of such properties were able to subdivide, some would likely split off a lot and use the cash to build themselves a custom, energy efficient, old-age-adapted house. Or in any case, when they peg out, the probability is that a developer will buy the property and double the density.

    Oak Bay, as we know, prefers monster homes, which have a block busting effecting destroying the character of old established neighborhoods and generally lowering the tone of the municipality. Instead they should go for a minimum lot size of 4000 square feet, as in Vancouver’s Point Grey, and subject all building permit applications to review by an architectural committee to determine consistency with the character of the surrounding properties.

  78. and Leo, no that you are licenced and have access to the back-end system we use if you think selling a home is rocket science and worth more than someone makes in a year working at Thrifties please enlighten me 🙂

  79. No data out there on mere postings vs full commission, so you can’t really blame the consumer for falling for the realtor rap of “I’ll get you a higher price to more than cover my commission”

    Take a look at mere postings in condo buildings and then compare to what units sold in the same building in the same market using full service. It is in no ones interest to analyze this data as the result are obvious.

    You don’t really need data for something that’s common sense. It’s like when I got my first real job at VIHA and needed new glasses and had no benefits yet. Local brick and mortar place priced them out at $670….as I walked home my thoughts were how on earth can two pieces of plastic and some crappy frame made in China cost $670? The other thing that crossed my mind was my optometrist had a $220k Porsche and he had a business selling glasses attached to his optomertry practice. Even at 21 yrs old it was enough to trip me off that something didn’t add up.

    Got home, hit Google, and ordered my first pair from Clearly Contacts for $70 shipped to my front door. That was 2007 and haven’t looked back since. 10+ pairs all purchased online. After my first pair of glasses I invested a lot of my money in Clearly Contacts (which was eventually bought out and paid for a huge chunk of my home construction) and I followed the BC Optician forums on line for years and it was hilarious the arguments they were using against Clearly Contacts and trying to lobby the government to shut them down. All 100% non-sense scare tactics.

    Let’s say a home is market value $1,000,000. Are you saying that $33,000 in commission will yield $1,033,000? $50,000 in commission will yield $1,050,000 and so on? I don’t think so.

    It’s pretty simple, mere post your home, delay offers 4-5 days, review offers, and if you have any concerns add “This contract of purchase and sale is subject to sellers’ lawyer review by such and such date.” It is not rocket science.

    I use to run very complicated ventilators and oscillators at the hospital….like 10x more thought involved than reviewing offers.

  80. All comes down to my Costco gas concept…..people will line up for 10-15 minutes to save a few cents on gas but when it comes time to saving 10-20-30k on the sale of their house they can’t do 10 minutes of research.

    I don’t think it’s quite that simple. Does a realtor get you a higher price than selling it yourself? Well, it’s quite possible if you don’t have MLS exposure that that is the case. But does a realtor get you a higher price with full commission than with a mere posting? Well economics would indicate no, but how do you really know?

    No data out there on mere postings vs full commission, so you can’t really blame the consumer for falling for the realtor rap of “I’ll get you a higher price to more than cover my commission”.

    Same for selling. You advocate offering full comission to the buyers agent of 3%/1.5%. Yet 1% realty routinely sells houses offering less than a third of that to buyers agents. So who’s right? Does going with 1% reduce your chances of selling? No way to tell.

    Much more research on the financial side showing that high MER is almost certainly wasted.

  81. That’s debatable as a property has to be exposed to the market for a reasonable period of time. And that reasonable period of time will likely be different for different classes of property.

    Totally agreed. My definition is crude at best, so some properties classified as “dregs” will not actually be those, and vice versa. However I am not including vacant land or triplexes and other revenue property so that takes care of some of it. I’m not sure that a house on a busy road or a fixer upper really has a much smaller pool of buyers. Many “normal” buyers would consider one at the right price.

  82. Look – the census data counts Homes as vacant if no one was there on census day. This catches people on vacation or people who do live in palm desert for four months who hire a house sitter. It also catches houses for sale or under renovation and completely derelict places. Plus those occupied by foreign students. And the number has actually declined since 2011, unlike Vancouver which went up 15%. I agree you can add an extra tax to derelict buildings – seems sound policy. And I agree if we have a foreign buyer issue then it should be taxed. The rest -no. Smoke and mirrors to deflect political pressure from any real solution – like maybe solving transit issues in Langford, increasing density in some areas, and supporting smart growth and government jobs in these areas.

    Retained equity and low interest rates don’t help inventory but if I understand the issue it is less inventory and more about demand. Time to adjust expectations and stop trying to force seniors out of their homes or penalizing those who want to travel the world. Sour grapes creates bad policy.

  83. Barrister:
    “I dont think that Victoria has a housing crisis what we have is a perception problem. It is like saying that there is not enough affordable housing in Malibu or Carmel.”

    Lol, Barrister, you are absolutely correct about regular middle class people not being able to afford the core homes in MAJOR cities. I’m not quite sure that you can lump Victoria in with Toronto, though. let alone Malibu or Carmel.

    For what it’s worth the latest financial system review by the Bank of Canada seems to have pinpointed the problem rather well.

    http://www.bankofcanada.ca/wp-content/uploads/2016/12/fsr-december2016.pdf

    Key Vulnerabilities in the Canadian Financial System
    The Bank continues to judge three vulnerabilities as the most important for
    the Canadian financial system:
    ƒ the elevated level of Canadian household indebtedness,
    ƒ imbalances in the Canadian housing market, and
    ƒ fragile fixed-income market liquidity

  84. Yes congrats Leo! Appreciate your unbiased presentation of data and always searching for the truth behind the numbers.

    As for seniors, I also think it’s Orwellian to tax seniors if they live alone – they’ve already paid a huge amount in taxes all their lives. We need to deal with the excessive speculation first, not punish people who have contributed to society already.

    All of us are living longer, 80 is the new 60, we’ll all be there before we know it. Using my parents as an example, their home is much more than a physical location – they’ve already paid taxes to support Canada’s social programs, worked hard to have a safe & familiar place to put their stuff and to work on projects into their senior years. Most people (80-90%) don’t develop dementia or Alzeimer’s, and heart & stroke drugs are helping people live productive lives. They deserve their rewards. It’s not their fault that city planners & gov’t building-industry insiders can’t get their act together.

    Agree, Barrister, there’s a perception problem. My first home wasn’t near a downtown area. Millennials won’t be able to “move up” the same way unfortunately, but I paid a lot of dues before I could live in an ideal location.

  85. Congrats Leo, hopefully see the real info flow now.

    Credit tightening coming up by the looks of things as the OSFI is warning the banks to load up on protection and credit ratings are in jeopardy. Hello higher interest rates.

    Canada’s AAA Rating Is on Thin Ice

    “If trade protectionist measures are produced that hit Canada, that’ll affect government revenue negatively and a credit rating downgrade would increase the risk premium investors demand for holding government bonds,” said Randall Bartlett, chief economist at the Institute of Fiscal Studies and Democracy in Ottawa. “At this point, all of the risk is to the downside.”

    The increase in government debt yields since the election is expected to make it more expensive for Trudeau to fund his spending plans, Bartlett added, as new bond issues and rolling over existing borrowings from previous rounds of stimulus are poised to push up the cost of public financing.”

    https://www.bloomberg.com/news/articles/2017-02-10/canada-s-aaa-rating-on-thin-ice-as-trump-policies-threaten-trade

  86. “Jez Marco:

    “I run into a smart person like twice a year”
    “The average person has poor common sense and you can manipulate them so easy it’s not even funny”
    “Most people don’t have enough common sense”

    You kind of come off like a jerk posting stuff like that….”

    Finally someone else noticed too. I’m sure that will gain you some new customers.

    Most people after 6.5 years might think that just maybe, that their so called cash saving system doesn’t work ,the math is wrong and the public isn’t stupid, they just smell something that doesn’t add up. But that’s just me. Arrogance doesn’t help either.

  87. Luke:

    I dont think that Victoria has a housing crisis what we have is a perception problem. It is like saying that there is not enough affordable housing in Malibu or Carmel. I spent my whole life not being able to afford to live in a house in downtown Toronto and I worked seventy hour weeks. Such is life. Your sense of entitlement is showing.

  88. @Vicrenter
    Note that it’s listed below assessed. 3 beds on the main, updated kitchen, 2 bed suite with separate laundry …yikes …can’t see this going for less than 800k but it’s not my money! Best of luck.

  89. Think of how stupid the average person is, and realize half of them are stupider than that!
    – George Carlin

    Congrats Leo. I’m with Dasmo – I want in on the ground floor!

  90. Def. they should do something about the empty homes first and foremost. In reality, I think nothing will ever be done about seniors living in large homes by themselves.

    I think homes that are empty year round should be taxed heavily in a city like Victoria which has a housing crisis, to discourage speculators… problem is – how to enforce that?

  91. The comment that Nan made about seniors not being subsidized anymore by gov’t to stay in their homes longer was food for thought. I don’t think it ‘Orwellian’ if that subsidy was just simply taken away if they live in a home much larger than they need. The seniors grant is not much larger than the regular home owners grant anyway. If taxes go up for that senior living all by themselves in a large house, why not?

    It would never happen anyway, seniors vote too much. I’m not sure why an extra subsidy for seniors in the home owners grant is in place? (I can understand the disabled one though)

    What we have is a situation where the people who are seniors now, those that were too young to have to go off to fight in WWII, and the baby boomers now coming to senior years – have had the most privilege and opportunities of any generation, ever. Good for them, however, the Gen Xer’s (myself) and those after me (millennials) may be left with virtually nothing in the way of Gov’t social safety nets when we reach our senior years. This, after encountering a job market with falling prospects, falling wages, and less job security. On top of that, often, an over the top expensive housing market that far exceeds what older generations had to deal with. Thereby making having a normal life unaffordable for many. Many have had to forget about starting a family, for instance.

    Some thought should be given by all levels of Gov’t as to how to prepare to meet the needs of the future generations, so everything is not squandered by the time we get to our ‘twilight’ years. I’m preparing to take care of myself when I get old, as I don’t expect Gov’t benefits to be there. However, many of those in my generation and younger are not, so I do find myself wondering what things will look like for us after the baby boomers are done? As they say in many things… timing is everything. Good timing for the boomers (and those slightly older).

  92. Congratulations Leo!

    Mario – I have recommended you to many people. I have friends who used your services and were very happy.

  93. But you should reconsider your public approach to discussing your thoughts on your clientele. Many of us are so called “average people”.

    I think most of my clients are smart enough to realize when I say “I meet a smart person twice a year” that it is an exaggeration….

    Plus I can tell you someone who is going to be sensitive to me making a comment about the average person having low common sense in terms of finances is probably not a good fit with me in terms of a good working relationship. That type of person needs a realtor along the lines of “beautiful colours in this home, I think it will be a great place to call home and grow your family, let’s put in an offer the seller can’t refuse”

    It’s just not my style, whether it be right or wrong.

    Finally, I don’t think that HHVers are average. They are doing some research by being on the blog which immediately puts them above average.

  94. Marco, love the flat fee. But you should reconsider your public approach to discussing your thoughts on your clientele. Many of us are so called “average people”.

  95. You kind of come off like a jerk posting stuff like that….

    No but seriously…..I am an industry insider and I am saying what da to people paying 30k to sell an average Victoria home.

    Just trying to wake people up. I’ve been trying to help the consumer for 6.5 years now. Let me know how many other realtors (there are 1325) in Victoria offer this -> http://markojuras.com/849-flat-fee/

    I know I sound like a jerk but the proof is in the pudding. The vast majority buy some sort of argument that they should pay 30k to sell their home, how else do you explain it? I can’t.

  96. Jez Marco:

    “I run into a smart person like twice a year”
    “The average person has poor common sense and you can manipulate them so easy it’s not even funny”
    “Most people don’t have enough common sense”

    You kind of come off like a jerk posting stuff like that….

  97. Congrats Leo and best of luck figuring out the venture. I hope you give us all the opportunity for first round investing!

  98. I know of 3 friends/family members selling houses right now and all of them are looking into alternative models first (for sale by owner, etc). It’s just impossible to justify the commissions paid out on house sales, especially in a market where one open house leads to multiple offers. There has to be a better way!

    The problem is no one does it in the end. The average person (seems to apply to rich people too) has very poor common sense and you can manipulate them so easily it’s not even funny…. there are literally 100s of go to sales pitches that work in real estate that people eat up.

    “If I can’t negotiate my own commission, how am I going to negotiate the best possible deal in a huge bidding war on your property?”

    It’s the same as mutual funds. Most people don’t have enough common sense to realize that you won’t get anywhere paying a 2% MER when the market is returning 7% on average.

    Back in the day when I had time I use to get all my cars through private lease take-overs. Average person just didn’t get it so there were some insane deals out there. One of my Civics Sis I got off a guy in Cordova Bay. Had 11,000 km, 16 months into the lease, $328 per month, 0.9% lease, and he gave me $3,600 cash to take it over, and it was worth more than the buyout at end of lease, and he had it on usedvic for over a month with no takers.

    All comes down to my Costco gas concept…..people will line up for 10-15 minutes to save a few cents on gas but when it comes time to saving 10-20-30k on the sale of their house they can’t do 10 minutes of research.

    The list to sale ratio on my mere postings is higher than the market average and the amount of mere postings dropped YOY. Zero consumer appetite.

    I run into a smart person like twice a year:) Had one guy I referred to a colleague last year that had his Sooke house listed for $449,900 with full service agent, wasn’t moving after 45 days. Cancels listings, re-lists it with my colleague using mere posting for $434,900 and sells right away for full asking price. Was smart enough to realize that at the end of the day the price is the most important factor which seems to elude 99% of others.

  99. Would they sell more quickly if the dregs were lower in price?

    That’s debatable as a property has to be exposed to the market for a reasonable period of time. And that reasonable period of time will likely be different for different classes of property.

    Vacant land usually takes longer to find a buyer relative to other properties. The same with acreage and waterfront to say houses in the core. That’s not because they are priced too high but the market is smaller for these properties and therefore they require a longer market exposure than say a house in Gordon Head or a downtown condo.

    One blogger mentioned a four-suite duplex on a 0.4 acre lot in Oak Bay that just sold at full price for 1.4 million. That property appealed to a smaller market segment and it took 150 days to find that buyer. That property did not fit the profile of the typical mainstream Oak Bay home buyer looking for a character home to live in. The typical mainstream buyer might look at that property and consider it both a dreg and overpriced but they are not the target market for that type of property.

  100. Good luck Leo, I hope you are able to get some insight into an alternative business model and bring power back to the people. Too many bad realtors have soured people’s tastes for the profession, and many prospective buyers and sellers are looking elsewhere. I know of 3 friends/family members considering selling houses right now and all of them are looking into alternative models first (for sale by owner, pay $500 for MLS listing only with no further realtor involvement, etc). It’s just impossible to justify the commissions paid out on house sales, especially in a market where one open house leads to multiple offers. There has to be a better way!

  101. Some of them are indeed overpriced, but others are just unusual or appeal to a smaller segment of buyers. You mentioned luxury listings, but fixer-uppers, tiny houses on huge lots, houses divided into 3 or more units, very busy streets, unusual layouts – all can be hard to sell but aren’t necessarily overpriced

    True. However they would still sell quickly if they were priced lower. Also in this market they may sell eventually just because the market has caught up with their asking price. Last year someone could have listed at a delusional price $100k over market and in only a few months their place would be fairly priced.

  102. I suspect you did it to get a peek behind the curtain?

    Yes. Although of course my other motivation is that I think there is a business opportunity on the tech/real estate side. What exactly that looks like I’m still thinking about.

    On another note, was it as easy as everyone says it is?

    Yes, quite easy. If I wasn’t working you could probably do all the assignments in about 2 weeks. They force you to stretch it over 10 weeks though. Total cost about $4k.

  103. Property taxes should go up when you live all by yourself in a 3000 square foot house. High property tax for singles in big houses, the more people you have in there, the more grants you get for deploying the resource efficiently.

    Way too Orwellian for me. Let’s just fix the supply side instead.

  104. Congratulations Leo! I don’t think you sold out. I suspect you did it to get a peek behind the curtain?

    On another note, was it as easy as everyone says it is?

  105. Congrats, Leo!

    As for the analysis, I’m not doubting the ‘ultra-low inventory’ thesis, but I’m not sure about how you characterize the dregs. Some of them are indeed overpriced, but others are just unusual or appeal to a smaller segment of buyers. You mentioned luxury listings, but fixer-uppers, tiny houses on huge lots, houses divided into 3 or more units, very busy streets, unusual layouts – all can be hard to sell but aren’t necessarily overpriced, and are (eventually) bought and sold by perfectly ‘serious’ people. I know turnkey sfh’s are popular, but our market is more diverse than that.

  106. Seniors should be encouraged to consume appropriate housing, not be subsidized by govt to do what they want making it even harder for the younger generation cranking their kids in condos. With housing so tight, Property taxes should go up when you live all by yourself in a 3000 square foot house. High property tax for singles in big houses, the more people you have in there, the more grants you get for deploying the resource efficiently.

  107. Congratulations, Leo! And wow — that’s dedication to the blog. I so appreciate everything you do to provide us with great information on the housing market.

  108. When you were compiling the numbers did you just use the VREB listing date. I have noticed a real pattern of some houses either being taken off the market briefly or changing agents only to appear as a new listing on the VREB site.

    Yes this is common practice to try to make a listing appear fresh. If the agents changed then it is also possible that the sellers switched agents thinking that will make a difference (which it won’t)

    I really wish that the VREB would map out recent sales with the actual purchase price like Zillow does in the USA.

    Would be nice. Unfortunately not yet possible on a public site due to restrictions the board places on this data. Likely another couple years away.

  109. Good one Barrister – culling off seniors! Very funny!

    It certainly would lead to an increase in inventory – as I have noticed that often a house only comes up for sale in the core when someone has become ‘dearly departed’. (ex. 1908 Greatford Pl.)

    With seniors living longer than ever before, and staying in their homes as long as they possibly can, and Victoria’s core being home to a higher proportion of seniors than the National avg. (though arguably, now becoming younger) – Those who are younger and are looking for a property in this city can thank the awesome medical system contributing to their longevity for the lack of inventory moving forward… I think the lack of inventory will continue for years in the core until the baby boomer bulge finally reaches their twilight years… around the year 2045. Since, who wants to leave paradise?

    On a side note, a rare reduction on a new build that has sat for a long time in South Oak Bay (I guess, this one could be called a dreg). 2161 Beaverbrooke St, on a 3300 sprawling sq ft lot, reduced to $1,389k + GST + PTT. Hurry while the bargain is still there! Open house Sat & Mon! (now I’m really starting to sound like an agent)

  110. I had the passing thought if one removes the dregs out of the calculation then this would really impact the months of inventory number.

  111. Leo:

    Thank you for providing me with an answer that confirms what I suspected from following the SFH in Rockland, James Bay, Fairfield and Oak Bay (south Victoria).

    When you were compiling the numbers did you just use the VREB listing date. I have noticed a real pattern of some houses either being taken off the market briefly or changing agents only to appear as a new listing on the VREB site. There were three houses that had sat on the market for over three years in Rockland and they keep showing up as a new listing every three months or so. They were not flips and had not sold.

    Overall I think that you graphs portray the real situation.

    By the way, I heard speculation that the City of Victoria council is planning on solving the inventory crisis by culling seniors.

    Again thank you for all your hard work. I really wish that the VREB would map out recent sales with the actual purchase price like Zillow does in the USA.

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