A great time to buy or sell a home

For most people a home is the largest purchase they will make in their life.  And it’s so complicated!

Now you could do a bunch of research or you could relax and let an expert tell you what to do.

Fortunately there’s a whole bunch of people that specialize in the finer points of buying and selling real estate and they form organizations to help you, the potential buyer/seller.

In the USA there’s the National Association of Realtors or NAR and they put out this great ad in 2006:

LOL on bad timing.  In 2006 in the US only one of those options was a good move.  And yes, that’s a real ad.  Found it over at Burbed with thanks to gordholio.

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patriotz
Member

It’s a great time to buy or sell Research in Motion!

Er, um, ah…

jesse
Member

“Interest rates near record lows.”

“Near” was right, alas they fell further.

The latest talking point in Canada goes along the lines of:

“Interest rates at record lows and won’t be going up anytime soon.”

If falling interest rates didn’t help the US, one wonders, what will be Canada’s fate if rates simply stay put?

The Ant
Member

@jesse: If falling interest rates didn’t help the US, one wonders, what will be Canada’s fate if rates simply stay put?

..Or (heaven forbid) eventually start rising towards historical norms?

Shouldn’t be too bad right? If you pay $1000 a month and interest rates go up by 2 percent that’s not a lot. What’s two percent of $1000 again? I need to ask an expert..

jesse
Member

“Once in a lifetime buying opportunity”

They were right about that one. But not in the way they thought.

Told-you-so-in-2007
Guest
Told-you-so-in-2007

“Shouldn’t be too bad right? If you pay $1000 a month and interest rates go up by 2 percent that’s not a lot. What’s two percent of $1000 again? I need to ask an expert..”

Potential sarcasm aside, you do realize tha ta 2% increase in rates don’t equal a 2% rise in your payment, right?

http://www.gailvazoxlade.com/articles/home_sweet_home/how_interest_rates_affect_costs.html

jesse
Member

@Told-you-so-in-2007: Is it really too much to ask for homedebtors to google “convexity”? 🙂

VMD
Member
[Most Canadians plan no home buying in next 2 years: RBC] 4/5/2012 Reuters A growing majority of Canadians do not intend to buy a house in the next two years, even with mortgage rates near record lows, according to a Royal Bank of Canada survey released on Thursday. In RBC’s annual poll of Canadian homeowners, 73 percent of respondents said they are unlikely to buy within the next two years, an increase of 2 percent over the previous year’s survey. However, 46 percent of those polled expected mortgage rates to stay at ultra-low levels next year, up sharply from 30 percent in 2011. The poll also found that nearly 60 percent felt this year was a good time to buy a house, compared to 41 percent that felt 2013 would be better. “Canadians still feel confident about real estate but… Read more »
The Ant
Member

@Told-you-so-in-2007: Great link, here’s the chart from that page showing how much interest you pay on $200k at different rates and amortization schedules:

Amortization      5%               5.5%               6%            7%
20 years	 $115,500	 $128,500	 $141,800	 $169,200
25 years	 150,000	 166,200	 183,900	 220,200
30 years	 184,300	 206,000	 228,300	 274,200
40 years	 259,700	 291,100	 323,300	 389,600
Told-you-so-in-2007
Guest
Told-you-so-in-2007

@jesse,

“Is it really too much to ask for homedebtors to google “convexity”? ”

Yes! The banking beast survives off the backs of the ill-informed. 🙂

vreaa
Member

“Garassino has actively discouraged her own kids from waiting around to find out how it unfolds” – “I tell my kids to go out and seek their fortune elsewhere. You can’t do it here. These are kids that could build Vancouver. They’re educated, ambitious and entrepreneurial, and they don’t think that Vancouver represents opportunity for them.”

– from an article by Max Fawcett

http://wp.me/pcq1o-3Vu

Best place on meth
Member
Best place on meth

“Home ownership is a safe, secure way to build long-term wealth.”

There’s a lie that destroyed millions of American families.

The realtors should be lined up and shot for that doozy.

b5baxter
Member

New inventory graph at: http://vancouverpeak.com/groups/inventory-graph/forum/topic/2012-april-graphs/#post-2358

The rate of inventory increased slowed for much of March but now it seems to be picking up again. This is consistent with 2008 which saw faster increases in April and May compared to March.

Over the last month the average daily increase was:
54 (up from 47 last week)
At this rate we will reach 17,000 in 14 days (Apr-19-12)
At this rate we will reach 20,000 in 69 days (Jun-13-12)
and 25,000 by September-13-12

jesse
Member

@Best place on meth: “There’s a lie that destroyed millions of American families”

I think families would prove quite capable of destroying themselves without NAR. Executing them is a tough call, only because it might somehow absolve the populace of personal responsibility. OTOH I enjoy a good old-fashioned execution.

Boombust
Guest
Boombust

“However, 46 percent of those polled expected mortgage rates to stay at ultra-low levels next year, up sharply from 30 percent in 2011. The poll also found that nearly 60 percent felt this year was a good time to buy a house, compared to 41 percent that felt 2013 would be better.”

Guess what? On Global TV News this morning, when they reported this story they also added that one of the main reasons holding back potential buyers is (are you ready?) “The Greek Crisis”.

patriotz
Member

@Boombust:
No surprise. Even in the US people haven’t caught on that the root cause of all RE busts is the excessive prices themselves, not other factors. And that includes “subprime lending”. They keep thinking that “if only” things had been different prices would not have come down. They had to come down of their own weight.

WS
Guest
WS

This is the other very often mocked commercial that came out from the NAR around that time.

Suzanne Researched This!
http://www.youtube.com/watch?v=tN7GI0lkWPo

Very infamous down here.

WS
Guest
WS
skippa_azza
Member
skippa_azza

@Boombust: HaHaHa…The Global story (Greek crisis) made me laugh. This is the most absurd thing one can imagine about Canadian housing prices and confidence to buy. The people are delusional thinking the current prices are sustainable.

asalvari1
Guest
asalvari1

Hello,

Question to the Admin of the site:

Is it possible to get the “Show All” button next to the story, before it collects 51 comments ?

I find my self appending the “/all/#comments” to the story link to get the comments in chronological order. Also, in this mode, the page refresh nicely works and I can get the browser properly positioned on the last message I read after the refresh.

Eddie
Guest
Eddie

@Best place on meth: “There’s a lie that destroyed millions of American families”

And tranfered trillions of debt from the banks to the balance sheet of the government. Coming soon to a country near you!

registered
Member
registered

14 Boombust Says: “….they also added that one of the main reasons holding back potential buyers is (are you ready?) “The Greek Crisis”.”

Reporters report, they don’t hypothesize. Someone said that to Global, a juicy tidbit with the Fed’s scent all over it. The Greeks, the Americans, Asia crisis, Ireland, your greed (we warned you!), lunar phases: the finger pointing is just beginning.

Anonymous
Guest
Anonymous

@Best place on meth:
“Home ownership is a safe, secure way to build long-term wealth.”
There’s a lie that destroyed millions of American families.
The realtors should be lined up and shot for that doozy.

Agreed. There are laws out there that prevent the promotion of other types of investments in such a way…but it seems Realtors get a free pass…

VMD
Member
[Financials regulator (OSFI) says bank executives don’t always follow board policies] 4/5/2012 Bank executives in some cases have not been following policies set down by their boards of directors, raising the possibility of undue lending risks, Canada’s banking watchdog said Thursday. Julie Dickson, head of the Office of the Superintendent of Financial Institutions, said the federal agency has created a new safeguard against such practices as part of a slate of proposed new guidelines. “Going forward senior management will have to provide a declaration to the board that the financial institution is in compliance with the OFSI guideline (that they are following board policy),” she said. “This was added because we had noticed cases where board-approved policies were not being followed.” In an era of low interest rates and high household debt, real estate lending is one of the biggest… Read more »
b5baxter
Member

Quote from an interesting article on people renting instead of buying in a post-bubble Vancouver:

…In addition to facing stricter lending standards, many prospective buyers have cold feet. That drives up the demand for rentals.

“You have a younger generation that has seen the residential bubble pop,” Barry said. “The concept of homeownership is not necessarily something they’ve had at the top of their list.”

At the same time, landlords are seeing more renters enter the market as newcomers to the …. Vancouver area. Many belong to the generation, an age group born from around 1981 forward….

Yes, it is the “other” Vancouver.

http://www.columbian.com/news/2012/mar/31/rents-on-the-rise/

rp1
Guest
rp1

#15 @patriotz: “They keep thinking that “if only” things had been different prices would not have come down.”

And they have Canada to reinforce that belief.

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