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In real estate it is both nicer and easier to give and receive messages of optimism and assurance. No one ever wants to hear from a pessimistic broker or agent. But then no one wants to hear from a stupid one either. Pessimism should never be confused with pragmatism or objectivity. It would be wrong not to prepare sellers and ensure that they are in the best possible position to make the very most of the market we are in. Property is sold by people with their feet on the ground, not by those with their heads in the clouds – or worse!

So realistic brokers and agents are putting the Champagne back on ice for little longer in the UK. For a while many people thought that a buoyant property market had returned. In many places prices had regained their pre-2007 levels and there was strong demand.

But it would be foolish to ignore the many signals we have. In the market, all is not quite so rosy as it was. Demand has slackened off; mortgage lending is at a six month low; harsh economic measures are ahead and, despite low interest rates and helpful noises from the IMF that the British economy is looking better, few are deceived into thinking that the next twelve months or so won’t be a challenge.

For buyers with cash, or enough deposit to take advantage of some very good mortgage rates at the moment, this is a great market with lots of choice and a good degree of negotiating room. If purchasers missed the wonderful window of buying opportunity in spring 2008 now is a second chance to make a very good property investment in the UK just as it is in the US.

For sellers in the UK it is time to become hard-nosed business people. The message is clear. Pitch your price to attract lots of viewers and undercut the competition. Ensure that your home is always window-dressed to impress. Keep your eye always on your objective and try not to worry too much in the meantime. Encourage all offers and do not react crossly to low ones – it is not the first offer that counts, but the last! Negotiate hard on your next purchase. Finally, use a realistic broker/agent and not a silly one. Then, at last, you will be able to open that Champagne.

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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

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It is Tuesday morning January 1, 2008 and I am rededicating myself to writing in my Nova Scotia Real Estate Blog. I have taken more than a year off from writing and have missed it quite a bit.

Nova Scotia real estate has been very exciting over the past few years and continues to grip my interest in a number of areas.

MARKET REVIEW

The US buyers market: Obviously the the weakness of the US dollar is impacting our Nova Scotia real estate market. Nova Scotia, since the 1920′s, has long been considered a second home destination by thousands US citizens. Many began traveling here by rail and steam boat, however, whether it is now by modern air or road travel our American friends are slowing their pace of purchasing their second (and sometimes third or forth) home in Nova Scotia. All is not lost, as recently as December our web traffic, according to alexa.com, indicated that 55.6% of our web traffic comes from the US, relatively unchanged from 6 months ago. Where we see the difference is actual feet on the ground in Nova Scotia. Our walk-in traffic at our Chester office slowed considerably in the fall of this past year. While sales to US citizens is still happening, the tap is but a trickle of what is was a year ago. One advantage of the slow down has been that the American buyers who do see their way to our province are serious buyers and are not wasting our time, as they have brushed off the concerns of our dollar and are zeroing in on a NS second home, come hell or high water.

The emerging buying market from the UK: 22.2% of our web traffic is now from the UK., about double the increase in traffic from just a year ago. Our major investment in Mayfair International Realty is paying off with exposure to the UK market through the Mayfair site, the Daily Telegraph and recently Country Life web sites. And more recently, we also picked up propertyfinders.com and thetimes.co.uk (both under development – on-line end of Jan 2008) thus extending our market influence deep into the UK with hundreds of thousands of potential homes buyers looking at our portfolio of homes for sale in Nova Scotia. Lastly, our biggest weapon in our arsenal is the development of secondhomenovascotia.com by our Realtor, Kilmeny Fane-Saunders, singlehandedly she has had a tremendous impact on our sales to the UK market and has to be congratulated for her efforts. Well done Kilmeny!

Upper Canada Buyers: During late 2006 and and early 2007 it was predicted by many of my clients that we should watch out for the Upper Canadian buyers, but quite frankly this has been a non-starter. While we still have any number of buyers coming out of Ontario, it has not been a landslide by any means. One thing for sure, as we carry over 600+ listings throughout Nova Scotia, we will be ready when the tide turns in that area.

Alberta buyers: Not a land office business by any means. The magazine publishers would want to make us think that it is a goldmine or an unexplored oilfield ready to tap, well maybe out there it is, matter of fact, that is just what they have out there goldmines and oilfields. The trickle down is not happening as fast as one may think. Yes, we have some Alberta patch people returning home and buying, but again not hand over fist. It was interesting, about 8 months ago there was a pieced published in the Chronicle Herald newspaper that a Nova Scotia lad returned from the oil patch to buy his mother a home in Sydney, good on him, but the article wanted us to believe that this was only the beginning and every Nova Scotia worker out in Alberta would be buying two homes soon, one for himself and one for his mom. We it’s quite like that. It is starting to build, we have started advertising into the Alberta buyers market, we see how it unfolds this spring. However, I am noticing another phenomenon, native Albertans leaving Alberta for Nova Scotia. I recently sold a 20 acre organic garden and log home to an Albertan couple, that are just aching to get out of Alberta. They can’t wait to move here and live the good life. Now, that is a nice story!

NEW VENTURES

Costa Rica & Panama: This has got to be considered a bit strange, but we have done it none the less. Last June, Tradewinds officially began selling real estate in Costa Rica and Panama. Rene Flinn has moved to Latin America, more particularly in the city of David, Chiriqui Province in Panama and has been very successful in establishing Tradewinds trademark in Panama and Costa Rica. We presently have several million dollars of real estate represented in Panama & Costa Rica. and slowly but surely Rene is putting us on the map there. Our first sales should close early in 2008.

In Panama, we have formed an alliance with Alvarez Realty to co-list selected properties from there enormous 5000 listing inventory and market them on a global basis. And in Costa Rica we have partnered with n American land fund group to market Tenant-in-Common land parcels for pure investment and eventual ownership is desired along the Nicoya Peninsula below Samara and above San Teresa. More on this development, Tenants-in-Common and other places for sale when I return form my visit to Costa Rica and Panama in late February.

Halifax office: Finally the ground has been broken for our new office in Halifax at 53 St. Margaret’s Bay Road. It has been a long time coming. Our developer is citing rising construction costs and lack of manpower for the slow start. Regardless, it will be coming out of the ground soon. The condominiums above our offices wil be called Crown Bay, with the first two levels being set aside for commercial. We have purchased approx. 1600 square feet of the main floor with ample parking (23 spaces) for our office. We will be doing the interior design later in the year, but expect some innovation in our gallery area and display techniques. Our targeted occupancy date is Dec. 2008.

Thank you all and I hope you have a happy 2008.

th