Here is an update on the Kamloops real estate market for April 2016. In this update you can learn about which areas of Kamloops are hotter than other areas and which types of properties tend to sell the fastest.
March real estate numbers are out and here is a video detailing what is happening in the Kamloops market! Find out which areas of Kamloops are the hottest right now and what types of properties are in demand the most.
Brocklehurst or as the locals call it Brock is one of the older parts of Kamloops that was largely farm land as little as 40-60 years ago. Brock has great soil and nice flat building sites. The lots in Brock can be quite big. The Kamloops airport is located in Brock and if you travel past the airport you come across land that looks prime for further development. You can eventually get to Kamloops lake which has recently benefited from the Resort community of Tobiano and it marina facilities. If you are thinking about looking into Kamloops real estate for sale contact Andrew Thompson for the best information about Kamloops and area real estate.
Single Family Houses
During 2011 there were 140 sales of single family houses in Brock. Based on the houses that sold the average list price of these houses was $343000 and the average sale price was $334406. The average days on market for the houses that sold were 85 days. The average size of the house was 2000 square feet.
This is a picture of that average house. It is a 3 bedroom, 3 bathroom home.
There were 44 sales in Brock in 2011. The average list price of a Brock townhouse/condo that sold was for $200879 and it sold for $192622 after being on the market for an average of 56 days.
This is a picture of an average condo/townhouse that sold in 2011: This townhouse has 3 bedrooms and 2 bathrooms
There was 2 sales of lots in Brock in 2011. The average list price of the lot in Brock was $121950 and the average sale price was $118,000. The average days on market for the two sales was 6 days. The average size of the lot was 11350 square feet.
In a Buyer’s market where prices are coming down more people are thinking about buying rental properties. If you are one of those people you will be one of the elite! In fact only about 4 percent of Canadians decide to buy rental properties as part of their investment portfolio.
One of the herdles that investors have to get over to begin buying rental properties is finding down payments! Here are 7 options for you to consider to get those funds:
- 1. Liquid Assets
You can sell off some stocks, sell your car, your coin collection, or rare doll collection etc.
- 2. Real Estate equity
Properties tend to appreciate over time you can now take up to 85 percent (as of March 2011) of your equity out of one of your other properties! You usually have two options take out a mortgage for the full amount of equity (usually at lower interest rate or get a line of credit (LOC) for the amount. By getting a LOC you don’t have to borrow the full equity amount. You bank might offer a ‘re-advanceable mortgage/LOC’ combination where every time you make a principal and interest payment on your mortgage, the amount of principal that is reduced in the mortgage is automatically available to you on your LOC.
- 3. High-ratio insured Mortgages
Put less money down on a property. This is a very difficult option in the present market conditions, as described below:
Up until 2006 The Canada Mortgage and Housing Corporation (CMHC) was the only mortgage insurer who would insure rental properties. AIG United Guaranty entered this market in late 2006 and targeted the residential market coming up with 90% financing for investment properties. As well GE Financial entered the market and matched any service AIG would offer. Then in August of 2007 a rumbling from a hedge fund in France led to an avalanche called the “sub-prime crisis.” As a result GE and AIG both withdrew from the market of residential rental properties in Canada even though Canada was relatively impervious to the sub-prime crisis.
In April 2010 bowing to the concerns that the Canadian housing market had not only recovered from the recession, but was in fact getting overheated once again, the government stepped in and annouced further changes. They simply eliminated any CMHC-insured high-ratio mortgages for real estate investors with less than 20% down.
- 4. Sub-prime Mortgages
Not many people understand sub-prime mortgages. Sub-prime mortgages are lent out when the person or the property is ‘sub-prime’. In Canada the number of sub-prime mortgages represented less than 5% of the mortgage market where as in the US sub-prime mortgages represented up to 25%. Sub-prime mortgages came about to service the individuals who had a hard time proving their income (for example the self-employed).
Ever since the sub-prime crisis virtually no lendersare active in this market. The few that remain will go up to 85% but that changes every month depending on market conditions.
- 5. Private Money
When every option is exausted to get cheaper conventional money look at private money. Private money is not for everyone. Private money is best used on a short term basis. Suppose you find an ideal property but the current owner has the rent well below market value, but you have to wait a year to increase the rent. At present the CMHC will only grant you a first mortgage for up 55% of purchase price based on the current DCR calculations. If you are very confident in the market and value of the property private money might be a great short-term solution. Financing for flips might also be a good option.
Don’t confuse private with a zero-down option. Just because the money comes from a private source and not a bank doesn’t mean that the lender doesn’t worry about risk. Some private lenders worry more about security than the banks.
- 6. Vendor take-back mortgage
In the case where the market favors the buyer vendors might be willing to do a vendor take back mortgage (VTB). VTB’s are essentially a second mortgage that is arranged by the vendor. Say for example, you wanted to buy a property but didn’t have 20% to put down you could approach the seller and ask them if they would ‘take back’ or grant you a portion of the down payment say 10%. There is currently no Canadian bank that will allow the VTB to be as high as 20%. Banks typcally only allow up to 10% of the mortgage to be VTB on rental properties.
- 7. Joint Venture partners
A joint venture partnership (JV) can be structured many ways but the most popular is when one partner does all the leg work while the other provides the cash. Both parties would be on the title and therefore responsible for the mortgage. The JV can be for whatever percentage you negotiate.
I hope you have found this information informative. Finding a good rental property includes using a good Realtor. Please contact me if you are considering buying rental property in my area!
As the old saying goes…”Times change.” That is never more true than with the real estate business. Back before there was internet marketing running ads in the newspaper for your home became a vital part of the selling process. Newspaper ads were vital in getting the word out that a property was for sale. Buyers were far less sophisticated and at the mercy of the local information that was available to them and that information was limited to their individual agent or brokerage that they were dealing with at the time. Buying a home back then could be a lot harder and depended greatly on brokerages to give out information.
Since the internet age the marketing of a well known product, like a house, has been dramatically streamlined and made easier. The internet has allowed organizations to easily gather information and sort it so that it can be easily viewed and analyzed. Everyone knows that if they want information on a certain topic they can “google it” and answers to their questions will magically appear before their eyes. As real estate professionals in Canada we enter listings into a large data base following strict guidelines that keeps track for past sales, expires, and active listings. We even made it easier for Buyers looking for homes to find them, no website is required, just an email account. In fact, properties that meet a Buyer’s criteria can get emailed to them directly as soon as they hit the market or change in price.
Before the internet it was not hard to see where the value was in using a brokerage to sell your house. Today the value of real estate agents have shifted to analysis of the data that is now available and analysis of the buying processes itself. Today, just like in any established industry, the value of a good real estate agent is all about making the home buying process more efficient. There are a lot more options out there for the average buyer and a lot of potential risk they might run into. Prices of homes have dramatically gone up and there is an expectation of transparency from the public to insure that confidence remains as high as possible. It is now the real estate agents job to insure that Buyers are treated with VIP treatment and guided to make the right choice(s) when it comes their home purchase. Every buyer has their own needs that is based on their particular personality and lifestyle. As a sophisticated real estate agent I know it is in everyone’s long term interest that they find a house that best meets their needs so that financial freedom and not hardship can be had through real estate ownership.
Interested in finding more information on the Kamloops real estate market?
Have you been trying to sell your property with no luck? You are not alone every month there are about 300 listings in the Kamloops area that come off the market without selling. Here are two important factors that surprisingly get over looked or ignored.
First, price is a huge factor on whether or not you get an offer from a potential buyer because buyers always want to see value in what they are buying. When you are trying to determine the right price for your house the best way for you to know that number is by knowing what comparable houses have sold for recently. You should never really take an appraisers evaluation or even real estate agents valuations to heart unless particular comparable houses back it up. The market is dynamic so you should get updates on those houses to see where the market is going. The market can change after just one sale or even before a sale happens. These market changes occur for a number of reasons but they can be monitored to a certain extent with inside industry information. Real Estate agents earn their pay by converting as many potential buyers into actual buyers and by limiting unnecessary risks. As a general rule of thumb, in the real estate business poor real estate agents perform 5%‐15% worse than a good real estate expert.
Secondly, when a buyer is trying to buy something outside of their disposable income it becomes a huge decision for them, a life changing event. Whenever I deal with a buyer I always sit them down and ask them about their particular needs and wants. I use this time with them to educate them about the market conditions just so they know what to expect before we even start going to view houses. The information they give me and information I provide them greatly increases the speed and likelihood they will make an offer on a house I show them because I am going to do a very good job of identifying their needs. I will just show them properties that meet their needs then I will gain a commitment from them. If I don’t go over their needs then it is likely I will be running around town with them looking at so many properties everyone’s head will start to hurt, and a top quality sale will be hard to come by. Buyers are free agents they have no commitments– they can be in the market one week and out of the market the next so it is important to get them to commit sooner rather than later and address their needs to help insure every sale is a win/win situation, for both the seller and the buyer.
If you are thinking about selling in the Kamloops area contact me for a no obligation real estate consultation. I want you to make the most amount of money for your property.
There is a myth that listing your property during the winter months is a bad idea. In reality if you are hoping to sell your property there is no bad time to list your property, especially in a Buyer’s market where you could potentially lose out on that elusive perfect buyer. The Buyer that loves your house just the way it is and therefore is more likely to pay you a premium dollar.
In fact, a lot of sophisticated Sellers prefer to list their property in the winter. During the winter months there will be less people “just looking” at houses which means that you will tend to get fewer viewings but is that truely a bad thing? The buyers who are looking in the winter are usually more serious – they are typically out-of-towners who NEED to find a house in a short amount of time or another Kamloopsian who JUST sold their property and NEED to find a place of their own quickly as well! Both types of buyers are just hoping to buy a property for fair market value and want to do it as quickly as possible so they don’t end up homeless or stuck in a long term rental. Fair market value has a lot to do with what has sold recently (in the last couple of months) and usually has little to do with what is currently active on the market.
If you are considering Selling our house in the Kamloops area feel free to contact me for a free real estate consultation to determine if the market conditions are right for you to make that move you are thinking about.
Kamloops has always had a great rental market when compared with other BC interior cities like Kelowna and Vernon. Kamloops is known more of working class town where as Kelown and Vernon have had more interest seniors downsizing from large cities like Vancouver and Victoria. As a result home prices tend to be a little more expensive in Kelowna and Vernon.
One of the reasons Kamloops has had such a great rental markets over the years has been a lack of multi-family residential units – apartment complexes. The majority of apartment complexes that are out there are old (40 years) and have been well used. Look for this trend to change a bit as demand continues to grow for rental properties in Kamloops.
On top of this large corporations have snapped up a majority of the apartment complexes in Kamloops, with the Kelson Group leading the way. This all translates into a Seller’s market for multi-unit residential rental units (6 or more units) as well some rent stability for current landlords.
So should Sellers be present during a property showing? Sellers could answer any of the questions that the Buyer might have, and that would be good, right? In actual reality it is bad, believe it or not. The only question that the Buyer wants to know while looking at a property for the first time is if they can see themselves living there. If the Sellers is present during the showing, or even if the Seller’s pictures are everywhere, that makes it harder for the Buyer to picture themselves in that house.
I have had experiences where the Sellers have been present during the viewing of their home. They answered all of the Buyers questions and end up talking too much. In the end the Seller walks away thinking the Buyers are really interested in the property and the Buyers walk away thinking the Sellers really love THEIR house. Unfortunately the Buyers are looking for their own home.
If you are thinking of buying or selling kamloops real estate check out this great website. I am a Kamloops real estate agent, or Kamloops Realtor and would like to learn about your real estate needs.