Where is this market going in 2009?
I get asked this question every day by Sellers, Buyers, and people on the street, and so do most real estate professionals! Everyone is curious, as though somehow real estate in Belleville were an indicator of where life in Canada is going in general. But is it?
We have a very locally defined market, as most places in Canada do: in the case of the Quinte region, it is fairly economically stable because there is no major industry on which the entire local economy relies. Other mitigating factors, such as being located very close to a major military base, Canadian Forces Base Trenton, has a very stabilizing influence. Hence the statistics from the Quinte and District Real Estate Board do not reflect the same drastic changes in house prices and sales volumes that some areas of Canada have delivered: that terrible sort of news the media rely on to deliver their doom and gloom economic scenarios.
The simple truth is that the Quinte Region is managing fairly well to weather the current "recession". We are not far enough into the 2009 market to really know how it will all pan out in the long run, and to compare to sales volumes and statistics from 2007 and 2008, is, well, quite misleading.
So what answer can a realtor give to those who for one reason or another, just must sell or buy this year?
There is no answer but hard work and diligence, I believe. That means a lot of comparative shopping and a lot of research on the part of the realtor to protect both seller and buyer. All a realtor can do is to disclose what the markets have proven to date. We do not own crystal balls, nor can we tell you where the markets will go in 2 years or 5 years.
The other answer is that we need to move forward with confidence as a local economy, to avoid taking a paralytic stance that is the norm when perceived "bad weather" lies ahead.
No doubt there are those who are suffering due to job losses and indebtedness. Hence my comments which follow:
One factor which may affect the sale or purchase of a property, is the inability of either party to close due to overleverage of the property. In a rising market, prosperity and price increases have insulated Buyers from the truth that may hit them shortly before closing: their lawyer may discover that so many encumbrances (mortgages, liens and other debts registered against the property) are in excess of the property value and the purchase price. The Seller may not have excess cash in addition to the purchase funds advanced on closing to pay off the additional encumbrances and thereby give clear title to the Buyer.
What a realtor needs to do is be prudent in investigating the situation long before the offer stage is reached. Listing realtors need to do their homework on the financial situation of Sellers before the property is listed for sale. Buyer representatives also need to ask the right questions of the Listing representative of the seller. Otherwise no one benefits, no deal is possible, everyone is disappointed and many other opportunities are lost. For further information, refer to the Ontario Real Estate Association's publication: "Realtor Edge" "Do Your Homework Ahead of Time to Protect the Deal." The guidelines in this article will save everyone a lot of heartache on closing.
Century 21 Lanthorn Real Estate Ltd.,