Buy or Sell in our Canadian Realestate Market

[GHVan]

I have recently noticed our market on a slite decline. There has been a number of new listing and very few sales. I'm currently holding 2 properties, 1 fixer and 1 spec home which I'm half way to completing. I'm hesitating on purchasing any other properties feeling that the US market has effected our market. Not sure if I should continue investing here or look at investing in the US?

 

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[8 SNAKE]

What's the economy like in Vancouver?

 

[kimberland]

The analysts are predicting
flat house prices for the next two years
in Toronto.

That said,
houses around my neighborhood have been sitting.

Vancouver, however, is a whole other barrel of fish.
You have the Olympics there in 2010.

Does anyone know housing trendlines
for an Olympic host city?

 

[AroundTheWorld]

Olympic City Housing Market... interesting to think of looking at that!

A Canadian told me once that their observation is that the Canadian Housing Market seems to lag the US market by about a year.

 

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[GHVan]

Thanks for the reply!! Our economy is in pretty good shape at the moment. However, we do generaly tend to follow the US having said that, the sudden Realestate decline here in Vancouver has my guards up.

 

[Yankees338]

Thanks for the reply!! Our economy is in pretty good shape at the moment. However, we do generaly tend to follow the US having said that, the sudden Realestate decline here in Vancouver has my guards up.

Hmm...well, if that's the case, then perhaps you could plan around your future predictions?

Maybe you could take on the strategy of buying and holding properties? In this case, maybe following RK's philosophy that "you make your money when you buy, not when you sell," would be better for you. If you can successfully locate cashflowing properties, then you can hold them for as long as you need to in order to build equity. Of course, you should then create a whole new plan around this strategy.

Another idea would be to pursue the commercial sector of real estate investing. Commercial properties gain their value strictly through their profitability. It's a complete numbers game. The only effect the market will have on your property value is really however it affects your property's income. (Please, anyone, correct me if I'm wrong.)

Good luck; keep us posted!

 

[kimberland]

Isn't 70% of Canadian trade with the US?

Much of that is oil and natural gas.
Canadian Trade Surplus with US Falls: Canada’s Job Losses Result from Higher Loonie and Weaker USA Economy

And the auto and manufacturing sector
is very heavily Eastern Canada based.

Vancouver WILL have issues
as they are competing
for baby boomer retirement living
with price dropping Florida.

 

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[PablitoCroft]

I don't believe that the Canadian real estate market will get into as much trouble as the US market has.... Typically the Canadian lending institutions have tighter qualification rules. Not saying that it won’t cool off at all but we won’t see that same dramatic decline that the US has seen. In response to the situation in the US, the CMHC (Canada Mortgage and Housing Corp.) has recently changed the guarantee rules for Canadian mortgages. They no longer allow 40 yr amm. terms with any less than 20% down. This will help ensure that people can actually afford the houses they are purchasing.

I believe the housing market in Vancouver has been alittle over valued (much like Toronto has been). I read a while ago that the average cost of a SFH in Vancouver was $1,000,000….. There are still plenty of area’s in Canada that are prime candidates for RE investing. As with the RE boom that was associated with the Oil boom in Fort McMurray AB, there are plenty of spin off opportunities… Have a look in Saskatchewan. Good Market…. Bad Market…. There are always RE strategies that can make money.

 

[kimberland]

I agree, PablitoCroft,
and I understand that
Canada didn't have the bump up in investment real estate
that the U.S. did.
Even our REITs were fairly conservative with their buys.

Again, real estate is regional.
Toronto may be flat for house pricing
but Oshawa (think a Cdn Detroit - 32 miles from Toronto)
will definitely be decreasing.

 

[PablitoCroft]

I completely agree kimberland. With all of the impending layoffs at GM in Oshawa, that will put a real dent in that market. But as always, in every adverse situation there is always opportunity as well.

I did read that Oshawa will be producing the new Camaro though.....

 

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