The Royal Bank of Canada (RBC) released the results of their latest monthly consumer confidence survey today.  As the Canadian economy climbed out of recession in the third quarter, the RBC survey finds that just over 60% of Canadians expect the economy to improve next year.  Details can be found by clicking here.  RBC is forecasting that the tiny bit of growth recorded in Q3 2009 will be followed by an increase of GDP by 3.4% in the fourth quarter and by 2.6% overall in 2010.

South of the border the financial markets were buoyed today by three big factors:

1.  Increased U.S. home sales.

2.  Updated data suggesting that the fallout from Dubai’s debt default announcement should be relatively contained and not be a contagion for the world’s financial markets.

3.  Favorable orders and inventory data.

Further details found in the WSJ article by clicking here.

In addition to the 3.7% increase in pending home sales in October mentioned in the WSJ article, the National Association of Realtors (NAR) the volume of home sales increased by 11% in the third quarter of 2009 (including a 3.7% increase in October) and were 5.8% higher than Q3 2008.  Pending sales are up 31.8% year over year, although these volume increase have not been accompanied by an increase in prices.  Prices have been moderating and NAR expects foreclosures to be on the decrease.  Details found by clicking here.

Thanks for reading!  Please contact us for all of your real estate needs in Victoria BC.

Sean Farrell

Well, well, well, we know that many real estate markets are in better shape than the media portrays in the headlines, but even this news was surprisingly upbeat to us. 

Ozzie Jurock reported in his daily facts-by-email newsletter yesterday that sales are up 100.8% in January of this year over January of 2008.  Let me reiterate that is year-over-year, and not month-to-month. 

I was tempted to not post this story, because some astute people will point out that the big reason for the increase in CA sales is, as Dennis Gartmann points out via Ozzie’s newlsetter, that the laws of supply and demand apparently are still working:  The median prices of homes in CA have decreased 40.5% in that same time. 

My reluctance post those statistics stems from hoping to avoid having some people come to the quick (and incorrect) conclusion that median prices must drop 40% in all real estate markets.  This will simply not be true of all real estate markets as they are heavily regionalized due to climate, economy, standards of living, taxation and so it goes.  I could write a book on this stuff, and we will invariably keep referring to this concept over time, but I am also doing my best to not write book every time I post.  Suffice to say, Canada’s banking system and economy are in much better shape that they are in the U.S., and there are many more regional differences within Canada as well.  Some markets will see price decreases of more than 40%, some much less.

Ozzie often includes a ”Major Point” in his articles, in this case, he points out that the time period involved in these numbers are YEAR OVER YEAR figures (January 2008 to January 2009), and not month to month figures, which make them statistically much more significant as they are very unlikely to just be “blip” numbers.

I’m going to follow Ozzie’s example and highlight a “Major Point” of my own.  If you remember only one fact from this post, please, please, please remember that real estate markets are highly regionalized; price drops of 40.5% in California are not indications of what is happening in other real estate markets such as British Columbia, Florida, Ontaria, Alberta, Nicaragua, Italy, and so it goes.  That being said, we’re very happy to see the increased sales in California.

If you would like to read the entire excerpt from Ozzie’s newsletter please click here.  If you would like to subscribe to Ozzie’s newsletter, you can sign up at his website: http://jurock.com/

Thanks for reading, please contact us if we can help you with any of your Victoria real estate needs.

Sean