I've had the pleasure of attending many events over the past couple of weeks, from fundraisers to family dinners to just chatting over a quick coffee. Whether it was seeing family, renewing acquaintances or making new friends, the most popular questions remained the same. "How is Real Estate?", "How much more will prices fall?".
Reports in the media about prices falling, bubbles bursting, and home ownership being a bad investment has Canadians worried. Home ownership and building equity are part of our fundamentals. How dare people question these? A question I'd like to ask these writers is, "do you own the home you live in?". Wouldn't the answer to that tell us a lot?
It boggles my mind how creative journalists can assemble irrelevant information from uninformed sources and make these armchair real estate agents the industry experts.
First of all, real estate values and market conditions are very local. Days-on-market (DOM) in Windsor doesn't mean Markham's DOM will increase, and a last year's $650,000 home in Edmonton that fetched $600,000 this year doesn't mean that a townhome in Halifax just dropped $50,000. Articles like "Look Out Below" in this month's Money Sense has me shaking my head. Absurd recommendations and bad advice sum up the content of this article, so save your $19.95 on this annual subscription if real estate information is your desire. Articles like this have been printed in most publications and they definitely are effective. They have people talking about the market as well as extend a lifeline to the struggling print media business. Important thing to remember is that the numbers being thrown around are averages from across the Canada and USA. Some of the information being printed has no basis and is strictly based on opinion. There's even advice that can't be acted upon because the scenarios and solutions presented don't apply to Canadian real estate. The Money Sense article goes on to recommend that you sell privately in today's market. If you're selling your home in a "confusing" market like now, your best move is to get a professional realtor on your side to make sure you're not leaving any money on the table. Trying to sell on your own when the market is as confused by media reports, as it is now, is like trying to perform your own root canal to save a few dollars. The damage inflicted could cause more problems.
I'd like to reiterate that real estate values are very local. If your realtor has done their homework at the time you purchased your home, you will have paid market value for your property and the nonsense about prices falling 10-20% will not concern you. As with anything, if you went into an "auction" style purchase and paid a premium to beat out competing offers, then you paid above market value for your home. This doesn't mean the market value has changed for the area, it just means that the home was worth the premium TO YOU at that time. Factors that affect price, appreciation, and depreciation are different for each locality and you can't extrapolate figures and make them general.
As a real estate professional, I take great pride in providing my clients with the true value of their home by considering all local factors as well as keeping an eye on nationwide trends. If you're looking to see what is happening in your neighbourhood and find out how your home is appreciating during this time, ask your Realtor. They research your local markets, work in the field day in - day out, and trade in real estate locally every day.
Back to the two most asked questions from the past few weeks, and how I answered them:
1. "How is Real Estate?"
The answer to that varies on whether you're buying, selling, investing or renting today. The market is always great for one or two of those moves at a time, so which one are you considering?
2. "How much more will prices fall?"
Market prices are not falling. The average price year-to-date is up across the Board, you can't dissect figures to come up with generalizations. You need to look at the whole picture. When would you like to meet and discuss your specific situation and how we can build your real estate portfolio to protect your investments?
Perhaps the most interesting conversation I had this weekend was with someone I met for the first time. He said something that hit the nail right on the head. While chatting about the market, he said "I've been following you and a couple of other popular agents on Twitter for the past few months and realized that it doesn't matter what the market is doing, all you need is an agent that knows what THEY are doing." I couldn't have said it better. Relate that to any aspect of your life. Hire the best accountant and you will keep more of your money, the best doctors will make sure of your well-being and a great Realtor will do the same for your Real Estate portfolio.
Friends don't let friends rely on the media for real estate advice. Call me today for an update on your home and pass on my information to your colleagues and friends that are looking for today's value for their properties.
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