Bad news travels fast. So when the news papers quote a 50% or more increase in foreclosures for the Vancouver area,everybody thinks the worst.
But how bad is it really here? What is 50 or 60% of zero? Even a 100% of zero is still zero.
I don,t mean to be funny or undermine the problems that some people have, but I am not for generalizing the situation. If the only source of information is the newspaper, than we may be all in trouble. Good news doesn't sell the papers or magazines. That is why you can read some incredible quotes on front pages of your supermarket magazines. A child born with three heads?
You and I know that is not the truth, but enough people buy those magazines just to find out if maybe there is such case.
The following chart shows you the current listings in different areas and the percentage of foreclosures as part of the total listings. There are also two columns that show December 2006 and December 2007 sales with the percentage of foreclosures as part of the total sales.
Showing a one month sales only may not give you a true picture, but it seems very consistent. In any case, current listings show that only 5% of all the listings in the areas shown are the foreclosure type.
Even in good times we will have 2-3% of all the sales classified as foreclosures.
You can play with numbers all you want but the fact is tghat the foreclosures are not a huge part of the local real estate market. For us that can still recall the late seventies and early eighties, and 14% mortgage rates or more, we will remember the newspaper stories of home owners walking into a bank and dropping off their keys because they could not afford the mortgage payments any more.
So there you are. What do you think?
For illustration purposeshere are some USA housing stats;
With so many foreclosures as part of the regular listings the banks are competing for customers and that is why the discounts are and wiil be deeper than in Canada.
Are foreclosures a good deal?
Check back on my next blog and we will tell you if local foreclosures are indeed a good deal.
If you are looking to Buy or to Sell real estate in Vancouver area, give me a call. My consultations are FREE. The benefits to You, may be worth a lot of money.
Call Jeff Star at 604-506-8481 or email me at jeff@jeffreystark.net
