A client this morning asked abut the market in Nova Scotia. While he asked in general; “How is your business doing in the midst of the recession? No doubt the strong Cdn. dollar isn’t going to help sell my house anytime soon.”

I know what he was really asking “Why hasn’t my home sold?”

To answer his question I responded with this comment on the market.

Dear Tom,

I wrote more than intended to answer your question, but here it is all the samel…..

The real estate market is odd this year. I had prepared my agents for hard times this year, but everyone seems to be selling. Luckily we have a very, very broad range of product and spread across the province (700+ listings), so on a company level I have something selling somewhere, which insures cash flow. Having said that, January & February were scary, as the cash was freely flowing out the door, just on heat, lights and salary and no income for those 2 months. I can see where big companies get in trouble quickly when they can’t stem the cash burn during no-sale or slow-sale months.

On a local scale, our under $500,000 sales are good. New listings are selling quickly, back-logged properties are a bit stuck as they have been passed over by the market. Very hard to kick these back in gear. You almost have to paint the house another color and move it over a block on new foundations to get people to look at the property in a new light. Something like the Monty Python’s sketch “That parrot is dead” and switching it to a conversation with a Buyer.  Buyer:”That’s not a new listing, that was for sale last year, that property is dead!”, Agent: “No it wasn’t, it is not dead, it is just sleeping, it was a different  colour last year, so it is a different listing, have a look. I can hear it breathing.” Buyer: “But is the same house, and it is dead, expired, no longer of this earth!” Agent: “No, it is not, it is a different colour, it’s not expired, it is a new listing, so it is a different house, have a look.” etc…

On the serious side, what we are lacking, are Buyers! The US Buyer is close to non-existent and the UK Buyers went real quiet in the past 6 months. However, this is light at the end of the tunnel. There is some turn around, as we have had a few UK buyers in the shop in the past few weeks. But all under $500,000 in interest. Over $1,000,000 sales have not happened this season as yet. Having said that, we have a few, very few, potential Buyers coming in this late spring, but they are holding their cash tight and expecting the best of product for their dollar.

House prices are not depressing, but they are not growing either (some MLS figures indicate a 10% drop in selling prices, year over year, but that is data prepared against the total NS market). If the property is priced well and value is evident on first blush, Buyers respect the price and aren’t cutting back their offers. But if they suspect it to be over-priced for the market, they either dismiss it or make an offer to low to work with.

What has been evident for the past few months is that pricing is key. Some new Sellers entering the market are pricing at a net loss, after they take in all house costs and upgrades over the years. But in all our sales thus far this year, the ones that sold, the market asking price was set by the Realtor. The days are gone that owners can dictate their own asking price and expect to beat the market and sell above the line.

Tom, the above is just a very general comment on the market and not specifically targeted to the Chester market, your house or any house particularity, these are just my observations of the market in general.

cheers.

Tim