What is the Salt Spring Island real estate market doing?

The Salt Spring island real estate market is in a state of "price compression".

Price compression is when the bottom end houses do not go down in price (they are in the 400k range and they are selling fast) but the top end houses over 2 million are dropping asking prices and are still not selling.

This real estate price compression goes all the way through the market and makes all the houses, over that bottom price, drop in price.

The market is like a slinky that is fixed at the bottom and stretched. At the top end the slinky is very stretched out but at the bottom end the links are very close. This is what happens when the market takes off; the high end soars and the bottom end is fixed in place or rises a little. When the market turns into a buyers market and there are lots of listings, the slinky retracts and the high end starts to snap back.

I have seen BC real estate listed at 4 + million and not sell, drop to 3 million and not sell, drop to 2 million and not sell, dropped to 1.5 + million and sell............ What is the house that was listed for at 1.5 million worth when a supposed 4 + million dollar house is listed at 1.5 million? Way less.

Sellers need to be the value leader in their price range to sell. The buyers are looking for deals. If sellers are really not into dropping their prices to reflect the current market conditions they should take it off the market. It would make it easier for the buyers to sort through the listings if the houses with unrealistic prices were off the market.

It is just basic supply and demand. Right now  (December 2007) there is very little demand for high end homes.

 

 

8 Comments on What is the Salt Spring Island real estate market doing?

Ouch, any sign of that virus spreading to Vancouver Island?

01/04/2008 01:58 AM by ladyinred

It is the same market on VI. The high end is retracting. To much product at unrealistic prices and not enough buyers

01/04/2008 01:02 PM by Salt Spring Island real estate agent Scott Simmons (One Percent Realty Vancouver Island)

I'm seeing this happed here in Vancouver and the lower mainland of BC

01/04/2008 10:46 PM by TJ Jones

The slinky analogy is the best description of price compression I've ever seen, it makes the concept very clear. I'm seeing the same thing in Vancouver as well, lower priced condos are selling and still going up in price, but higher priced homes sit for longer and see more price fluctuation over the last year.

http://vancouvercondo.info

01/08/2008 01:16 PM by Lahlahlah

This blog post has been linked to on quite a few other blogs and the local paper is going to publish it in the paper tomorow. The high end houses are like a tell tale on a Sail boat and they could mean change is coming fast.

01/08/2008 03:18 PM by Scott

Scott - I see you don't post to many groups... did you know you can post to 5 groups each time, and get more eyes on your blog.  Just a suggestion. 

02/07/2008 06:01 PM by Georgina Hunter Maui Realtor R(S) (Jim Sanders Realty Inc. - Maui)

I dont really try to post to active rain groups. The groups seem to make comment to get points and what is the point.

02/07/2008 08:45 PM by Salt Spring Island real estate agent Scott Simmons (One Percent Realty Vancouver Island)

The point of the points is to move you up in your area, to the top of the pile, so consumers will find you.

Maybe you're already at the top, as your area is limited, like mine. 

02/08/2008 05:23 PM by Georgina Hunter Maui Realtor R(S) (Jim Sanders Realty Inc. - Maui)

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Real Estate Agent: Salt Spring Island real estate agent Scott Simmons (One Percent Realty Vancouver Island)
Salt Spring Island real estate agent Scott Simmons
Salt Spring Island, BC
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One Percent Realty Vancouver Island

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Salt Spring Island real estate information by Scott Simmons a agent that can help you find your dream home at the right price. Scott's brokerage is One Percent Realty Vancouver Island