September, 2010.
So, here we are, perhaps at the shift moment.
Last Fall, I projected that our secondary home/discretionary market region would not see "uptick" until August/Sept/Oct of 2010.
This uptick does seem to be underway, right on cue. Throughout 2009 and the first half of 2010, no rural area in my region saw good action. That seemed to be limited to the primary residence/city markets. Rural/secondary home/discretionary markets can be "put on hold" during uncertain times.
I realize that media reports are stating this and that, but they are generalized comments. When they spoke about the huge increases in real estate in this region, in 2009/early 2010, it wasn't describing the secondary home areas, but only the city markets. Very misleading then, for all those sellers who were languishing in rural areas, wondering where all that action was.
It is acknowledged that media reports are usually 90 to 120 days in the past, based on the statistics they have at their disposal, and that their broad sweep ignores the micro picture of specific areas.
We may be reading about what is happening right now, then, in this specific secondary home marketplace, in November.
There is no road map in existence, at this exact moment. Wish we could all carry a crystal ball with us!
Huge potential, then.
Things I have noted, right at this exact moment:
Some realtors/companies, perhaps needing "incoming" not just expensive "outgoing" may be stating that things are continuing to collapse, so that sellers might be encouraged to reduce property pricings by 100,000 +. This is called local market manipulation.
It might be a decision, company-wise, or by an individual realtor, to generate income. There are apparently very few increases in viewings or in offers, though.
Instead of bringing forward activity, this localized price suppression makes reluctant buyers "put on hold", a little longer, their new desire to "do".
Or, if they do want to "act", in the here and now, they will offer far lower than they might have done, based on these wildly low and realtor driven personally skewed price reductions.
It is Buyers that set markets, not Sellers or Realtors...if realtors plunge prices, though, for their own (not market responsive decisions) benefit, then it does create that local market manipulation moment.
When these potential buyers see such wildly enormous reductions, "all at once", it makes them hold off from action: "if I can wait another 4 months, I can get it cheaper" syndrome!
A misunderstanding that may cost them. I would feel more sanguine if we were hearing the buyer's voice, initially, with direct sales at prices reduced from list figures, without the spiralling price reductions in between.
However, the early responders, it seems, may already have acted.
Along with localized responses, we have the very beginnings, it appears, of the desire to get out of cash positions and into good hard asset investment opportunities. That appears to be what the early responder buyers are saying.
I realize that the deflation vs inflation "argument" has been apparently "evenly weighted" since 2008.
The word "inflation" appears to be gaining ground when one pays attention to current media reporting.
There is also a renewed interest in fine art sales; unique items are being purchased by individual appreciators and not by museums or corporations. I often think that real estate purchases in discretionary areas follow the path of fine art auctions, perhaps within three or four months of same.
That kind of purchase may be a desire to preserve capital, and may signal a move back to all good hard asset investment options.
A shift in a market!
On Salt Spring Island, and on all other Gulf Islands, there will always be a limited inventory. The provincial government body, known as the Islands Trust, created in 1974, capped growth on all the Islands, through strict zoning/density bylaws.
The Trust is for the benefit of all B.C. residents, so it's not about the Islanders at all.
Topographically, on the entire Pacific Northwest Coast, there is a very thin rim of habitable land -- limited land between the sea and the mountains.
Along with that "natural" limitation, on the Gulf Islands we have this government imposed cap on growth.
Low interest rates, a seller who has bought into the myth of a collapsed market and so is over- ready to be rescued with an offer, hungry realtors who further push the idea that housing is a lost cause as a viable investment, an area that is the desired destination for 90 percent of Canadians (the weather, if nothing else!), a move towards worry about a too heavy cash position/fear of inflation, a seeking of a safe haven to protect the family and the capital...it all adds up to a "nexus position"...shift, change...call it what you will.
It means the fog of indecision with the markets, since 2006, in all secondary home/discretionary marketplaces, and globally so, is evaporating.
Ah...the contrarian position has never been more essential.
Last year, the buyer offered and the seller dropped to meet that buyer. This year, the seller is holding firm and if the buyer is "real" they are rising to meet the seller.
The shift is with us!
This truly is the time to buy -- a short window on this Gulf Island gem.
More information/statistics? Call me!
liread33@gmail.com
How may I help you to buy your special Salt Spring Island or Gulf Islands treasure?
How may I help you to discover special Salt Spring Island & the Southern Gulf Islands? Call me!
