I received an email from a regular reader that informed me of a new home that has dropped in price 26% from peak pricing only six months ago. I looked into this alleged price drop and it checked out. Here is a link:
This is a development of 40 or so smaller townhomes in the eastern Fraser Valley - Chilliwack. The asking price for these townhomes in May 2008 was $269,900 and today they are $199,900 with an additional offer of special financing for the first 3 years. It appears the developer is getting eager and wants to quickly unload the rest of this project. I am certain there is a fair bit of margin for the developer to work with here but I suspect the bonuses for those working at the developer won't be gigantic this year.
This is the biggest recorded asking price drop that I have seen so far. It is no surprise that we are seeing the biggest and fastest price drops in the farther reaches of the Fraser Valley. This is exactly what happened in the other North American bubble markets only it is happening here faster! In fact, this is quickly approaching affordable levels, albeit in Chilliwack. But with $10,000 down and a mortgage / strata / tax payment of $1300 / month it is comparable to rent. Very accessible for a first time homebuyer with stable employment, you just better not have to commute further than Abbotsford!
Post your anecdotes of price drops here with the developer's website or MLS Listing number.
I went to see V738727 last week, just because we were in the area, and I knew that two other listings in that building had dropped from $368 & $379 to $309K. At the time, V738727 was listed for $349K. I told the Realtor that I wouldn't pay more than $250K for the unit, especially considering the other 2 units in the building are $40K cheaper and bigger. She called me back 2 days later and said I could have it for $299K. Getting closer, but no thanks. The owner purchased the unit for $285K in '07.
A 35% drop from $349K would put the unit cost @ $230K. With a 20% downpayment, 25/yr 5.5% mortgage, you'll be lucky to break even renting it out - $1300/mo for a bigger 21st floor unit.
To make matters worse for the seller, there are 25 listings in the building currently and there's an identical building nearing completion across the driveway, in the same complex.
Very informative. Here is a tip to the beginners : Be disciplined. While its good to go to the movies, dine, have a binge once in a while, don't compromise on the money you have decided to set aside every month for retirement. And importantly do a 'cost-benefit analysis'. If the Rs 1,000 you spent on movies and dinner last week was instead invested in an equity fund, it would have grown to nearly Rs 20,000 (at 10% compounded growth) after 30 years!
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Realestate Talks: Underwater Sales/Listings
THL at 1199 Marinaside Cres has also reduced by 26% in 6 months.
Orig $1,175,000 in May.
It's a bargain relative to other properties in the area.
For anybody STILL doubting the coming of hyperinflation in another year or two:
Rest assured Harpo will have the Bank of Canada running the digital printing presses over time, cuz otherwise, our dollar will be worth about U$4.00, and poor, bloated, union saddled Ontario and Quebec will export NOTHING.
According to this thread in RET,
"A very nice house in the College Park area of PoMo just sold for 450K. The owners TURNED DOWN an offer of 628K last Spring. The address, in case you are interested, is 170 Harvard Drive. So there."
Here's a listing for 498K just down the street, the houses are all pretty much the same.
Remember folks - somebody ALWAYS has to sell.
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