Hugh Bray

OCTOBER SLIDE STEEPENED

Halifax Dartmouth MLS^® home sales continued to slowly slide as global economics soured during the month of October. At month's end our region's year to date market performance was down 8.3% compared to the same 10 months in 2007 (the best MLS^® sales year on record).

While our local market is still "healthier" than markets in many other areas of the country, we do have an obligation to report to you on those market conditions that are going to affect your success as a Buyer or Seller in the weeks and months ahead.

• Halifax Region Sales for the month of October 2007 performed at -18.2% versus October 2007.

• We witness a continuing slide in the number of homes sold in 2008 to date vs. the same ten months in 2007 (-8.3% or 575 units less).
• Average home sale prices are starting to moderate in many of the neighbourhoods within the Halifax Dartmouth region.

NOVEMBER - MORE OF THE SAME!

We have continued to see more of these same trends in the month of November as evidenced in the preliminary monthly stats shown below. As of today's date November has performed at a rate of -39.1%, or 182 fewer sales than November last year. This is a very strong signal that we are in the beginning of a market correction; which again points toward "Buyer's Market" conditions.

"Days on Market" have climbed to an average of 112 days to sell a home in November, up from a healthier 98 day average in November 2007. Homes are selling more slowly and with slowing price increases; more definite signs of a cautious, "deal shopping" Buyers' Market.

THE ECONOMIC IMPLICATIONS FOR BUYERS & SELLERS

• Our regional economy continues to send us mixed messages. Barely two months ago, gasoline was selling in the $1.20 - $1.40 range; today we are buying a litre of gas in Halifax for $0.81; proof that commodity prices have seriously deflated. It is difficult to say yet where the economy is going or if we are at the beginning of a short term slide or in the midst of a full blown recession.
• While the US real estate market is in continued bad shape, and home prices in other centres across Canada are deflating from several years of record growth (Edmonton, Calgary, Vancouver etc.) our Halifax Region real estate market is still fundamentally sound and those who understand the market dynamics will be prepared to prosper.
• Home sale prices are slowing down, toward the lower levels of 2007. Short term price growth is at an end for the foreseeable future (see average November sale price above). Lower prices mean buying opportunities are on the rise for Investors and first time home buyers.
• Buyers may perceive that they are losing money when selling a home in these market conditions. However home value is only determined by what motivated Buyers are prepared to spend for a specific home, in a specific market, at a specific time. One has to understand and accept this, then plan accordingly.
• Sellers soon become buyers and must remember they will be buying their next home in the same Buyers' Market conditions in which they sold their home. The return on the sale of their home will be proportionate and complementary to their purchasing power and options for their next home.
• Good news! Mortgage rates are still low and readily available. Working with a professional Mortgage Broker will ensure that your credit qualifications are in place before shopping.

WHAT DOES THIS ALL MEAN TO ME?

One has to be very well prepared in order to generate a profitable home sale. Clearly one has to manage their expectations in order to maximize the return they receive. Avoid confusing a desire for the double digit price gains of recent years with a "reasonable profit". Those days are gone for now.

Motivated Sellers and Buyers must heed the market indicators in order to have success. Successful, profitable home sales will occur for those who respect these changes and choose to work with an experienced, professional REALTOR^®.

Please remember that only three things sell a home - Good Preparation, the Right Price and Good Marketing!

Expert Marketing and full-service support are essential for success. Avoid discount service plans or do-it-yourself "For Sale by Owner" services - doing so may well mean the difference between an efficient sale and a home sale disaster!

• Every neighbourhood and price bracket has competition - be aware of your competition and be ready, then price aggressively to sell ahead of them. The Seller that sells first amongst "equal competitors" is more likely to extract the highest value! More time on the market means eventual price reductions and fewer net dollars in your pocket!
• You can't live in a RRSP! Think about investment strategies where the proven long-term stability of Real Estate puts accrued home equity or retirement savings to work for you. Think about income property buying opportunities for long term investment growth. Call your REALTOR® today for a professional investment property consultation!
• Remember that prices are slowing down in most neighbourhoods in Metro and surrounding areas; set your expectations realistically and then get to work on a positive selling strategy with your REALTOR^®.
• REALTORS® are trained experts and poised to assist. They understand thee tougher market trends; they know how to manage delicate, changing market conditions and are ready to serve!
• Call a REALTOR® today to help you prepare your property for sale and to experience an efficient and happy home selling or home buying experience.

You couldn't before and you sure can't today!

The housing market slowdown in Halifax Dartmouth is subtle in comparison to the huge upheavals that the average investor has suffered due to the meltdown of the world's equity markets. Personal savings and retirement plans that relied upon Mutual Funds, RRSP deposits and owning equities in publicly traded companies have turned "sour" big time and folks are reeling from the losses they have already incurred.

Real Estate has been affected as well. Even in our relatively "safe" Halifax market we are experiencing change. However compared to most other Canadian metro regions our "safe harbour" will not experience the negative market surges that the Toronto, Vancouver, Calgary and others are experiencing to the same degree. So what does this mean folks?

It means that investors like you who are looking for a safe investment strategy should be talking to their REALTOR^® about diverting a portion of their portfolio toward buying investment properties. This is an excellent time to become a landlord with a solid "buy and hold" strategy. This can be a time of very positive change for you. Read on:

1. There are a lot of good, affordable revenue properties on the market and more coming - houses, sets of flats, duplexes, and multi-unit properties.
2. Combined with an increase in foreclosures, decreasing sales and a slowing of the price increases experienced the last several years in Halifax indicates a strong shift toward a Buyer's market. That means you!
3. Compared to the "up and down" surges of the stock markets, income generating real estate shows more resilience and a smoother ride than the "roller coaster" effect other forms of investment will continue to give investors for the foreseeable future.
4. A "Buy and Hold" investment property strategy is a great way to ensure a safe a haven for your money with a higher likelihood of long term gain. Halifax and Region continues to show excellent affordability compared to other markets meaning that you have enhanced opportunities for acquiring and profiting from income properties than most other parts of the country.
5. There are great buys out there, and if you are not averse to injecting a bit of sweat equity into your new investment property (upgrades, fresh paint, regular maintenance) it can contribute positive, rapid ROI.
6. Vacancy rates are extremely low, and the demand for good quality rental housing is increasing... lots of available customers; another good reason for buying and managing your own income property.
7. Mortgage interest rates remain at historically low levels which encourages qualified individual investors to buy now. Ask us about introducing you to a great mortgage broker who can assist today.

8. You know nothing about managing a property? Hire a qualified property management company to do the work for you; management and maintenance costs are tax deductible expenses.

Halifax Region real estate truly offers many positive investment opportunities and alternatives to the individual investor. Need answers to your questions? Want to know more? Call your REALTOR^® today to put the wheels in motion!

Halifax Dartmouth homes sales in October fell off the stratospheric rates of 2007 by more than 30% and November is showing more of the same. What does this mean for folks that have to sell their home in these softening conditions?

Well for starters it means that one should definitely engage the services of a REALTOR® who will guarantee great communication, hard work and an aggressive marketing strategy that includes "visibility, accessibility and availability" for your property.

1. The REALTOR'S® marketing strategy must be broad and complete and include:
   1. Visibility - comprehensive web exposure, virtual tours, for sale sign, lots of online photos as well as cable TV and print exposure
   2. Accessibility - fewer buyers mean more aggressive positioning of the home for sale to attract Buyer eyeballs - make sure Open Houses are part of the plan
   3. Availability - some REALTORS® are hard to reach and often have the phone off when it should be on; check to make sure that your agent can be reached easily from 9:00 AM until 10:00 PM as a rule of thumb before you hire them. Cell phones that go directly to message services are a turn off. If the agent doesn't call back within 15 - 30 minutes buyers will say "next!"
2. Remember that the days of double digit price growth are over - do not expect anything more than flat pricing as of today's post. Your agent will help you understand what the current level of market pricing is for your neighbourhood.
3. Work with your REALTOR® to set a realistic and flexible pricing strategy:
   1. The market is "fluid" meaning that home prices are affected by the global economic conditions, even in our small marketplace, and they will continue to change as we go forward, possibly downward. Don't wait until prices bottom out looking for an unrealistic profit!
   2. Don't take it personally, and get on with the process. Listen to your REALTOR® and price your home to attract the largest number of buyers possible in your price range.
   3. Be aggressive, identify the competition with your agent and price to look better than them; clearly identify the features that may set your home apart for the price being asked.
   4. No action after two weeks? No viewings, no offers? Then look at a price reduction; tell the market that you are seriously "for sale" and open to buyers taking a look and making an offer. Remember, when bananas go soft the grocer reduces the price for a reason. Make your home attractive to buyers and stay "fluid" in your thinking and you will reap a higher sale price!
4. Keep your home in "show ready" condition at all times. Make sure that you are ready for viewings even during the work day. Out of town buyers will often be looking during weekdays and often viewing requests will offer no more than a couple of hours notice! Remember to keep your home "visible, available and accessible" at all times so that your REALTOR® can sell your home in the optimal time for the best possible price!
5. Call you REALTOR® today and get started!

This little news story from Yahoo Reuters News will surely make us all feel better in this time of uncertainty, and increase our national regard for our Canadian banking system. While it does not say we are out of the woods at all in regard to the world credit crisis, it does demonstrate relative health, strong fundamentals and the strong likelihood that we will be able to weather the storm better than most Western Nation's including such power house banking systems as those of Sweden and Luxembourg. The ratings were published by the World Economic Forum, and we encourage you to check them out.

http://ca.news.yahoo.com/s/reuters/081009/canada/canada_us_financial_soundest_banks

After having read this article pass it on to colleagues family, friends, clients and anyone on your contact list that may need a bit of positive reassurance about our national system and the uncertainty being felt across the country. Thanks to Yahoo Canada and Reuters News.

Monday morning, and what can I do to perk me up in light of everything that is going on in the world? Well for starters, I could run a query of the September MLS^® data for Halifax Dartmouth for the month of September to see where our homes sales ended up for the month. Is everything doom and gloom?

Actually no! Unofficially September Halifax Dartmouth transactions chugged right along with 527 sales, only 19 units behind the records of September 2007 (best year on record), making for a rather bullish month of sales. Our region continues to resist the trends being experienced in larger centres across Canada where double digit growth has been replaced by similar rates of decrease these last few months. While our numbers are down over last year, as predicted by economists, they are nowhere near those of other areas of the country and in America. Consider:

Year over year, homes sold for an average $229,074 this September versus $206,333 last year, an average gain of 9.9%. Not only that, but the average number of days on market decreased, meaning sales happened 5% faster (99 days average this year versus 104 days on average in 2007).

Are we out of the woods? Certainly not, but we are for the time being weathering the storm rather well. Advice? Buy to hold, add value to your home in the form of sensible upgrades and improvements, mitigate household debt by getting rid of those credit card bills and when you shop for a home, shop with a pre-approved mortgage commitment in place so that you will be ready to take advantage of any bargains you find when working with your REALTOR^®. Good luck, and Go-Halifax-Go!