:: The Barrie spring Real Estate market

The weather in the first week of April is as confused as the Robins and those optimistic drivers who took their snow tires off in March.

The Real Estate market has been about as predictable as the weather has been over the past year. Finally the buzz around my office has returned and my cohorts can once again look you strait in the eye without their voices going up two octaves when they reply on being asked "how's things going?"

It is getting busy once again.

Buyers have left the den, seen their shadows, yes and more importantly they are seeing mortgage rates are at record lows and the neighbourhoods are thick with an abundance of listed properties containing anxious vendors waiting for an offer to come to them.
Average prices are down over last spring and this spring's market is the first one in a dozen or so years where the buyer is in control at the negotiating table. (click links below for detailed statistics)

Now is the time to begin the hunt if you are planning a summer time change of address. If you are serious about a move, go to HotBarrieListings.com and start receiving instant updates on newly listed properties that match your custom search criteria.

After a long hibernation I am well rested and ready to help you buy your new home. Give me a call.

MLS® Statistics

Employment Trends

Interest Rate Changes

Consumer Confidence

Migration

:: Barrie Real Estate: 2009 = Buying opportunities ::

2009 holds opportunity for buyers

If there has been a time over my nine years working as a Realtor where the home buying public has had a financial advantage I can say with absolute certainty it is now and over the course of the next few months.

A snap shot of the Barrie area real estate market and the economy in this first week of 2009 shows us a higher number of greatly reduced property prices than at any time in the past ten years. Many of the homes I see for sale have been listed for months and as shown in the examples below continue to lower their prices every few weeks in the hopes of finding a willing purchaser.
Many are selling out of necessity over choice which for the buyer means their is additional room to negotiate prices down even further than the reduced list prices shown.

The efforts of our government to stimulate the economy has given us greatly reduced lending rates which right now are sitting lower than the average of the past ten years. This translates into lower monthly mortgage payments and a greater portion of your monthly payment going toward the principle that pays down the house.
2008 saw record numbers of resale homes listed for sale in Barrie, lower list vs... sale price ratios and longer list to sell times. Many homes that were pulled from the market in the weeks before Christmas will re-emerge on the market over the next few months in what is traditionally the high volume time of year. In short we are likely to see even greater numbers of homes for sale in the Barrie area between now and the end of spring which will keep the balance of negotiating power in the hands of the buyers.

It is entertaining somehow to watch the hordes who will line up in sub zero temperatures to save $50 to $100 off of a TV or computer component at the Boxing day sales each year or will burn $2 worth of fuel while lined up to save 2 cents per litre on a tank of gas.Right now the real estate climate is such that those people could effectively save themselves many tens of thousands of dollars on a home right now. Translated into bargain hunter lingo; enough coin to buy a new flat screen TV and a few full tanks of gas every year for the next twenty five years if they take advantage of the home buying opportunities available this year.

List price January 2008
$339900
Current list price
$299000

List price June 2008
$349000
Current list price
$299000

List price April 2008

$389900
Current list price
$312000

 

List price April 2008
$324900
Current list price
$259900

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You will also receive email alerts when prices are reduced on active listings that match your search criteria.

Barrie 2009 Market forecast
Best time to step up during a market correction

:: I qualify: Therefore I am ::

Consumption on a per capita level in the United States and Canada has grown in our lifetimes reaching a point within the last ten years that could be considered glutinous. If nothing else it certainty has proved to be unsustainable as we are witnessing in our economy

You cant just blame consumer society for this. It has been instilled into us from birth through marketing. Our sense of self worth and the value of life in general is dictated to us. From the growing numbers of glossy weekend news paper inserts to magazine, television and radio advertising. Where ever we go, our landscape is overwhelmed by media marketing. I can't even stand at a public urinal, a mans most solitude moment, without being face to face with an ad telling me what I need to do next after I zip up in order to add the value that is missing from my life.

Not only is consumption pushed on us, we are massaged by it and subconsciously forced to compete with ourselves and compare ourselves with our peers by the messages within. We are so inundated with bits and blurbs of what we are missing and what life can be if we choose this or that. It has us blinded to the here and now and has us living in a perpetual state of motion towards some consumer nirvana that lies just out of reach.

You can't be without satellite radio when they offer the first three months free. You can't refute the zero down zero interest for twelve month terms on the new car to replace the perfectly functional three year old car. Especially now that it is dated according to media determined society standards. Your home is incomplete without the don't pay anything till 2009 hot tub you will use only six times a year and even that is incomplete without the time share or cruise package that Marcy and Jim told us about.

I qualify: therefore I am. That should be the catch phrase to symbolize the last decade.

Well the rubber has now met the road and the financial slack with the carrot on the end is being reeled in. There is a contraction taking place and it needed to happen.
What I think is going to and is already happing as a result is reassessment of our material values for many. A new mass mindset where society will dictate less on what I drive, my car works fine thank you very much and I am quite comfortable with my four blade razor, I don't need to move up to the new six blade Gillette decapitator.

I don't need ten more separate twenty nine dollar a year Internet programs and services and that latest terabyte hard drive, though it rolls off the tongue nicely and does get my ram flowing, it really makes no sense when I have barely filled even half of my current hard drive.

I might even start to buy my groceries based on what I can consume thereby throwing out less and reducing the number of condiment jars in my refrigerator by twenty or thirty. I will learn to be content for more than a year with my current television, cell phone and digital camera regardless of the technological advances the next year brings and as hard as it will be, I will come away from Costco having purchased only the items I came for.

People are beginning to take a breath and starting to allow practical logic to govern their purchasing behavior once again. As they do they will find that not only can they manage but they will realize their financial health is stronger than it has ever been. Business is tweaked right now to keep production in pace with the demand of the consumer junkies we have become and the next few years will continue to be a period of adjustment.

It will run contrary to those of us within the Real Estate industries expectations of the past ten years as well, with people learning to value their homes in a manor our parents and grand parents once did as we begin to see a house as more than an investment or financial leverage tool.

People are going to trade up less often as a result but it will also mean that many, many more who are learning to act with more fiscally responsibility and live within their means rather than their credit card limits are soon going to be in a position to buy into the real estate market. Millions who otherwise would never have learned to save a down payment or build a credit rating will become purchasers of real estate over the next few years. I think this will more than compensate.

;; When should Barrie home buyers step up?

Buy low, sell high, the universal principle of investment and if it were as simple to implement as it sounds we would all be reaping the rewards.

The real skill is in best determining where the bottom of any market is before it passes by and it takes a few months of steady value increases to know we have hit it. It also lies in having the confidence to step up.

The logic one needs to apply is really no different than that used by a practical shopper in Wal Mart. When an item you have wanted goes on sale you snap it up, you don't shy away from it because the price has dropped. Perhaps if the headlines you've been seeing for the last six months read "Sweater market in trouble" then shopping for sweaters at any price tends to become an unnerving experience. That is exactly what happens in Real Estate and the media hyperbole typically overwhelms the opportunities lying within.

You can wait until the eventual upswing confirms the bottom has come and gone but by then the sense of urgency is returning to the real estate market and the squeamish have become frenzied buyers once again taking to the streets to stake their claims. Vendors quickly become aware that the negotiating control they lacked when prices were stagnant or heading south has now shifted back over to them.

Ok, so where are we now on that curve? Have we hit the bottom yet?

In Ontario and much of Canada over the better part of the last year demands for housing have softened. The biggest factor is the down shift in consumer confidence brought on by what we are seeing in the United States, and to a lesser degree here at home. It is a self fulfilling prophesy. The news tonight interviewed a couple in the mall and asked if they will be spending as much this Christmas. The answer was a resounding "no, the economy is too unstable." Meanwhile they stated their employment situation is unchanged. They and everyone are paying far less for gas and heating fuel than a year ago. Chances are they are in better financial shape all around than last November but the mood has changed.

Responsible spending within our means is taking hold, what will we do? Less spending and less borrowing to spend means fewer goods need to be produced by companies that expanded to accommodate a boom without any thought to it ending at some point. Now companies are downsizing to adjust and unemployment numbers are on the rise. The local widget plant is laying off 200 workers and when we see it on the six o’clock news our consumer confidence drops a little bit more and so on….

At some point when we begin to sense things are stabilizing the media hype shifts to everything is rosy mode. Stories on new and expanding businesses, profit gain and closing bell increases on the stock market get people excited and they start to spend their money and up their visa limits once again. New housing starts increase and we all do our happy dance spending and buying for a few more years. Donald Trump and Warren Buffett probably read Marshal McLuhan's works.

In the US it isn't quite that simple. More than just confidence has shaken their financial foundation. Their experiment with high risk lending has put them into a situation that will take a couple years at least to correct. Hopefully measures will be put in place to assure it can’t happen again, measures like we have here in Canada already that regulate lending practices.

Right now in the Barrie area, home sales are down; the number of active listings continues to accumulate with the inventory of resale home listings at record highs. Residential real estate prices on properties under the $250,000 mark have held their value and for the most part, continued to climb during the past year, all be it at a slower rate than in each of the previous eight years.

The under $250,000 range has been the most active for sales over the past year in the Barrie area. This is the price range most first time home buyers default to where carrying costs remain within range of what they were comfortable with paying in rent. In each of the next few higher $50,000 ranges the percentage of total sales drops lower and the gap between initial asking price and the percentage of initial list price received on sales drops as well the higher you go. A combination of factors is challenging sales in the above $300,000 range, The first and most obvious is higher carrying costs and tighter qualifying requirements. A wave of fiscal and environmental conscience has started to effect the housing industry the same way it has impacted on the auto industry. The Hummer is out, the Prius is in.

During the housing boom we just came through you saw a return to low interest rates that allowed many the opportunity to buy their first home. Builders responded in kind with record numbers of new home starts in most years. Many of these people bought townhouses or lower end homes being what they could afford, then within a year or two these buyers realized their home had appreciated by $25,000 to $50,000 and they now qualified for more and had equity to trade up into a bigger and better home with little perceived impact on their monthly budget. (One more entry level home for the market and the next first time buyer and one more buyer for the higher end market homes being churned out as fast as the land could be cleared.) That cycle has slowed and most who bought their first home in the past couple years are sitting tight and many who bough a higher end home in the last few years are looking to sell and find something more affordable. Those higher end homes are taking longer and longer to sell and are accumulating to record levels in and around Barrie and other Ontario communities.

Homes over $300,000 could drop more in price before we see a levelling off and a climb once again. This could take another year or so. Home buyers whose price range is under $300,000 are less likely to see average prices drop much if at all any time soon. What buyers have in their favour right now is a slower market where the urgency of the seller often translates into substantial dollars saved off the list price through negotiation. (This is where your Realtor proves their worth.)

A home listed for $250,000 today could possibly be had for $235,000 to $240,000, maybe less after some back and forth bargaining. Once the market is in full recovery mode the seller is more likely to guard the list price, confident that demand will bring other buyers willing to pay more.

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Questions to ask yourself;

Are homes in the price range I am interested in more like to go up or down over the next year? How much more? Am I going to save anything by waiting a year? Are interest rates more likely to go up or down if I wait a year? Will negotiating strength work for or against me a year from now?

The fact is interest rates are low and pressure will likely take them even lower in the coming months. Negotiating strength still lies with the buyers due to the abundance of active listings and a hesitant buying public most of which to their own disadvantage will not step into the market until it heats up again. It is a good time if you are buying your first home. First time buyers are benefiting well from our current market conditions.

As I said in a previous post. Stop reading the paper and watching CNN and spend some of that time looking at the nice thick catalogue of homes for sale.