Real eState
Prices for Okanagan real estate continue to fall while supply increases
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“Realistic expectations” are one of the changes in the Okanagan housing market, according to the Association of Interior Realtors.
In its May release of sales figures, the association said that there were 1,662 residential unit sales from the Shuswap to the South Okanagan in May, amounting to a 3.4 per cent decrease in sales compared with the same month last year. Compared to April’s 1,226 unit sales, however, things are looking up.
“Some buyers seem to have recovered from the rate shock and re-evaluated or have adjusted their expectations of what they desire to more realistic expectations so that they can resume their real estate efforts,” said Chelsea Mann, president of the association.
“While this is great to see, interest rates are still top of mind for many buyers.”
That’s probably more so as of Wednesday, when the central bank raised its benchmark interest rate to 4.75 per cent, an increase of a quarter-percentage point, in its first hike since January. The policy rate, which sets the cost of borrowing in Canada, now stands at its highest level since May 2001.
Whether that will affect buyers in the days to come remains to be seen. In Central Okanagan, there were 249 single-family homes sold in May, which was a rise of 2.4 per cent from the year earlier.
The price, however, saw some downward trajectory with the price coming in 6.7 per cent lower at $1,048,900. The number of days that a single-family home is on the market has also increased to 47 this May, which is a rise of 79.8 per cent year over year.
The Shuswap also saw more sales this May, with 61 transactions amounting to an uptick of 3.4 per cent.
Like the Central Okanagan, the benchmark price was down 5.7 per cent to $712,100, while the average number of days on the market was 62, which is up 105 per cent from a year earlier.
In the North Okanagan, the volume of sales decreased the greatest, with a drop of 14 per cent to 93 sales.
The price of a home in the North Okanagan also fell to $777,600, which was down by 4.6 per cent. It took 52 days to sell a property, which is a rise of 97.5 per cent from a year earlier.
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The South Okanagan saw similar trends. While the number of sales was down 10 per cent to 88, the days to sell had grown 50 per cent to 50. Prices were also 6.6 per cent to $772,200.
The total number of active listings saw an increase of 25.5 per cent of total inventory compared with May last year, with 6,767 total residential listings recorded across the association’s region.
The highest percentage increase in active listings was recorded in the North Okanagan, with a total increase of 44.8 per cent relative to the same month last year.
“The upward trajectory of new listings from just a month ago is a promising sign that inventory may be rebounding and starting to replenish at a healthier pace than before. It will be interesting to see if this momentum continues to help bring a more balanced market,” Mann said.
Pricing shifts are something that Mann indicated people may want to come to terms with.
“When looking at housing prices, especially with regards to B.C. assessment values, it is important to note that there may be a disconnect in perception when it comes to property assessed value versus actual market value,” Mann said.
“The B.C. assessment value will not always correlate with the actual market value,” Mann explained. “Those property assessed values were calculated last year, which does not necessarily reflect what is currently happening in the real estate market today.”
Real eState
Real Estate Stocks Fall As Mortgage Rates Rise To 4-Month Highs: 'Inflation Is Proving Tougher To Bring D – Benzinga
Real estate stocks slid at Wednesday’s market open, weighed down by the latest disappointing data on housing starts and a spike in mortgage rates, darkening the outlook for the sector.
By 9:00 a.m. EST, the Real Estate Select Sector SPDR Fund XLRE had dropped by 0.3%. This marked its fourth consecutive day of losses and set a course for its lowest close since the end of November 2023.
The fund has also slipped below its 200-day moving average, a critical long-term benchmark, signaling that investor sentiment has turned negative.
The average interest rate for 30-year fixed-rate mortgages with loan balances up to $766,550 climbed by 12 basis points to 7.13% for the week ending Apr. 12, 2024, according to the latest figures from the Mortgage Bankers Association. This rate is the highest recorded since early December.
On Wednesday, the yield on a 30-year Treasury bond, a key benchmark for long-term mortgage rates, traded at 4.75%, at the highest since mid-November 2023, as Fed Chair Powell admitted that there has been a lack of progress in the disinflation trend.
Chart: Real Estate Stocks Fall Below Key Long-Term Moving Average As Inflation Bites Again
Weaknesses In Multifamily Segment Continue
Joel Kan, MBA’s Vice President and Deputy Chief Economist, explained the rise in rates, stating, “Rates increased for the second consecutive week, driven by incoming data indicating that the economy remains strong and inflation is proving tougher to bring down.”
Despite the uptick in mortgage rates, there was a 3.3% week-over-week increase in the Market Composite Index, which measures mortgage loan application volume.
Kan further noted, “Application activity picked up, possibly as some borrowers decided to act in case rates continue to rise. Purchase applications were the primary driver of this increase, although they are still about 10% lower than last year’s levels. There was a slight uptick in refinance applications, mainly due to a 3% rise in conventional applications.”
Chart: US 30-Year Mortgage Rates Rose To The Highest Level Since Late November
The real estate market’s challenges are linked to affordability and a shrinking availability as the supply of new homes falls.
Andrew Foran, an economist at Toronto Dominion Securities, commented on the trend in home building, “Homebuilding activity moderated in March as weakness in the multifamily segment persisted and the single-family segment gave back most of its considerable gain from the prior month.”
Data revealed a 14.7% month-over-month decline in housing starts in March, with the figures dropping to 1.32 million annualized units, significantly below the anticipated 1.49 million.
Both the single-family and multifamily sectors experienced declines, with single-family starts down by 12.4% (or 145,000 units) and multifamily starts plummeting by 21.7% (or 83,000 units). This retreat in multifamily starts marked the lowest level since April 2020.
Additionally, residential permits decreased more than expected in March, falling by 4.3% month-over-month to 1.46 million annualized units. This included a 5.7% drop in single-family permits—the first decline in fifteen months—and a 1.2% reduction in multifamily permits.
Rising & Falling
The weakest performers among real estate stocks with a market cap of at least $1 billion on Wednesday were:
| Name | 1-day %chg |
|---|---|
| Prologis, Inc. PLD | -6.55% |
| First Industrial Realty Trust, Inc. FR | -3.33% |
| STAG Industrial, Inc. STAG | -2.89% |
| EastGroup Properties, Inc. EGP | -2.89% |
| Rexford Industrial Realty, Inc. REXR | -2.35% |
Those showing the highest gains were:
| Name | 1-day %chg |
|---|---|
| SL Green Realty Corp. SLG | 3.18% |
| Opendoor Technologies Inc. OPEN | 2.55% |
| Medical Properties Trust, Inc. MPW | 2.49% |
| eXp World Holdings, Inc. EXPI | 2.32% |
| Vornado Realty Trust VNO | 2.25% |
Now Read: Best REITs to Buy in April
Image: Midjourney
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
A Toronto real estate agent posted a picture of a $799,000 house that appears to be burnt down on TikTok saying it’s perfect for first-time homebuyers on a budget.
The agent, Ruthie Miller, was half joking.
Miller’s real estate career has run parallel to being a stand-up comedian. She found the run-down house as she was trying to look for a place to invest in herself.
Though she wasn’t the seller of the house, she thought posting the entertaining video on TikTok would attract more buyers to it.
The Yorkdale-Glen neighbourhood home is placed on a 25 x 130 ft. lot and the listing includes pictures of burnt down areas in the home.
Miller posted the video a week ago, but now the price is currently over $1 million on Realtor.ca.
“This house did have a fire and probably needs a lot of work. If you’re anything like me and you think to yourself, ‘Oh, I can fix him. All he needs is a little bit of TLC. He’s just had some bad relationships in the past,’ then you might be into this one,” Miller said in the video.
Some viewers were confused and wondered if the video was a parody.
“LOL genuinely can’t tell if this is a joke or not … a budget? Your gonna need another 200k to fix it it’s not even livable,” one person commented.
When asked if she thought her comedic approach to real estate could mislead people, Miller said, “I don’t know.”
Miller told Now Toronto that she was joking about some parts, especially about the house being suitable for a first-time homebuyer because of the structural issues.
Miller believes she’s bringing attention to real estate regardless of the method and people are going to look at the listing and request more information if they want to.
“I’m a comedian also, so why not mesh the two? It’s a clever way of doing it,” Miller challenged.
Miller believes Toronto’s real estate market always has room for humour.
“I personally like it. I hope I’m not breaking any rules with my professionalism. I like blending comedy with real estate. It’s easy to make fun of realtors because they’re usually advertising multi-million dollar properties when most of the city can’t afford rent.”
Real eState
Former HGTV star from Los Gatos sentenced in $10M real estate fraud case – CBS San Francisco
LOS GATOS – A Los Gatos man who starred in a real estate reality show was sentenced to jail and ordered to pay back nearly $10 million to his victims after being convicted of real estate fraud, prosecutors said Tuesday.
According to Santa Clara County District Attorney Jeff Rosen’s office, 58-year-old Charles “Todd” Hill received a four-year sentence. Hill starred in the HGTV show “Flip It to Win It“, which featured teams buying dilapidated homes and fixing them, before selling them for a profit.
The show aired in 2014.
Prosecutors said Hill was convicted in Sep. 2023 after admitting to grand theft with aggravated white-collar enhancements for committing real estate and financial fraud against 11 victims. Hill was indicted in 2019 following an investigation by the DA’s office.
“Some see the huge amount of money in Silicon Valley real estate as a business opportunity,” Rosen said in a statement. “Others, unfortunately, see it as a criminal opportunity – and we will hold those people strictly accountable.”
According to the DA’s office, Hill engaged in “multiple fraud schemes”, with some scams dating back before the HGTV show.
Prosecutors said in one instance, he diverted construction money for his personal use. In another, Hill created a Ponzi scheme by taking money intended to buy homes from an investor and spending it on a lavish lifestyle instead. He hid the theft by creating false balance sheets and used fraudulent information to obtain loans, according to prosecutors.
In a third case, prosecutors said an investor who provided $250,000 to remodel a home toured the property, only finding it to be a “burnt down shell” with no work performed.
Hill had used the money on a rented apartment in San Francisco along with spending on hotels, vacations and luxury cars, prosecutors said.
In addition to jail time, Hill was ordered to pay back $9,402,678.43 in restitution and serve 10 years probation. Hill has been remanded into custody, the DA’s office announced.
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