House sales down; prices holding
Local real estate market looked good in 2008, but has slowed
December 04, 2008
Meredith Macleod
The Hamilton Spectator
http://www.thespec.com/News/Business/article/476674
Sure, real estate sales are down, house prices are expected to dip and properties are taking longer to sell.
Local realtors acknowledge all that. But they are also quick to point out that 2007 was a record year.
They say 2008 was shaping up to be pretty good too, until an overheated housing market boiled over in the U.S., sending stock markets tumbling and slamming credit markets shut.
Local sales fell in October by more than 27 per cent over the same month in 2007.
Prices, so far, appear to be holding steady. Average home prices in Hamilton-Burlington are expected to climb by 4 per cent this year and then fall by the same amount next year, according to a national report released by ReMax yesterday.
The Realtors Association of Hamilton-Burlington will release numbers today that show local home prices are up 5 per cent, and November prices rose 6 per cent, over last year.
"We've had a great year in 2008, but it's definitely slowed down. People are nervous now," said Judi Caplan, realtor with Coldwell Banker Pinnacle Real Estate.
But people are still buying. The difference this year is that buyers are taking their time. In many cases last year, there wasn't that luxury. Homes were snapped up quickly and bidding wars became relatively common.
"A balanced market is better," said Caplan. "There isn't the pressure to jump on things and pay higher prices."
Caplan says banks are also taking their time. Mortgage approval used to come in a day; now it takes a week or more.
According to ReMax, national home sales are projected to be about 15 per cent lower in 2008 than they were last year.
In Hamilton-Burlington, sales will fall 12 per cent, says the national realtor. Next year, sales could fall by another 6 per cent, but ReMax says if consumer confidence bounces back, a recovery could come as early as spring.
Hamilton is especially hurt by blows to the manufacturing sector, says Ralph Schmidt, CEO and co-owner of ReMax Escarpment.
But he says this current market is nothing compared to 1981 when unemployment was high and interest rates were 21 per cent for first-time mortgages. "History shows this stuff all works out. No one likes the cuts and bruises but we're in a much better position today."
There is still strong demand for homes under $250,000 but those $500,000 and up aren't moving, says Schmidt.
Realtor Zena Dalton is happy to see the real estate market swing back in favour of buyers and isn't worried about falling sales.
"It can't always be high. Last year, you could put a sign on the lawn, get three offers and sell in a few days. This (market) will separate the agents who really know how to work a listing. There's been a lot of gravy years; it's time to work a little harder."
That hard work includes convincing sellers they can't expect to get the high price their neighbour sold for last year.
"Sellers haven't really caught up to the new reality," said Dalton, a realtor with Judy Marsales Real Estate who has been selling in Westdale and Hamilton's southwest for about 20 years.
"It's like pulling teeth getting some of them to drop (their price.)"
But she says properly priced homes are selling well. She recently sold a property for $490,000, just $4,000 under asking price, after only four days on the market.
John Sebastiano of ReMax Escarpment Realty says 2008 numbers are similar to those of 2003, before the housing boom began.
"That was a really good market and it is now, too."
He says listings might get half the showings they did last year and take twice as long to sell. If homeowners do drop their price, it's by $10,000 rather than $5,000.
"The slowdown is there but you can't set a record every year."
Sebastiano recently sold a four-bedroom house on the west Mountain for just over $299,000.
The sellers dropped their price three times by a total of $30,000. Similar houses sold last year for $320,000, says Sebastiano.
A tale of two years
Ancaster
2008
WHAT: 4-bedroom, 2 1/2- bath,
two-storey detached
HOW LONG: Has been listed on mls.ca for 104 days.
HOW MUCH: $418,900
2007
WHAT: 4-bedroom, 2 1/2-bath, two-storey detached
HOW LONG: Sold in 50 days.
HOW MUCH: $430,000
Hamilton Centre
2008
WHAT: 3-bedroom, 1 1/2-bath, two-storey detached
HOW LONG: Has been listed on mls.ca for 98 days.
HOW MUCH: $156,900
2007
WHAT: 3-bedroom, 1 1/2-bath,
two-storey detached
HOW LONG: Sold in 10 days.
HOW MUCH: $157,000
Stoney Creek
2008
WHAT: 3-bedroom, 2 1/2-bath,
2 storey detached
HOW LONG: Has been listed on mls.ca for 34 days.
HOW MUCH: $399,900
2007
WHAT: 3-bedroom, 2 1/2-bath,
2 storey detached
HOW LONG: Sold in 31 days.
HOW MUCH: $369,000
Source: Realtors Association of Hamilton-Burlington
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