----------------------------------------------------------------- D’Arcy R. Harris - Real Estate Update May 24, 2005 -----------------------------------------------------------------
Okay, here’s the thing. I’ve negotiated a contract with a new development. They were asking $319,000, and I got them down to $305,000. I thought the deal was in the bag, but my client pulled out. I asked the other agent if I could offer it out to you at a first come basis. It’s a three-bedroom townhome in New Westminster. It’s the best layout and location in the building and is the last of it’s kind. If you’re interested, email me. It’s RARE in this market to get a discount at a new development. If you’re sitting on the sidelines, this may be the time for action.
Also, I’ve included a GREAT commentary written by an accomplished real estate investor, if you’ve heard about this bubble, I highly recommend you read it.
Enjoy!
D'Arcy R. Harris Real Estate Broker Sutton Group - Westcoast Realty Tel: 604 484 6236 Fax: 604 488 0885 darcy@darcyharris.com
P.S: It’s a sellers market; find out what your home is worth with a free and confidential market evaluation:
http://www.vancouverrealestateinfo.ca/redir.asp?page=homeeval.asp&t=list
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Congratulations to M. who just bought a stunning 2-bedroom condo in New West. The moment I walked in I knew this was one nice unit. She thought so too and she put an offer in and we got it. When the inspector calls a unit a ‘no-brainer’ that means it’s in great condition. Congratulations!
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Special Commentary
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The following is an excerpt between a highly accomplished real estate investor and another investor, my brother in Los Angeles, Brock Harris of Brock Real Estate (www.brockrealestate.com). My brother calls him ‘my only certifiably genius client’. I’m sharing it with you because after I read it, it clarified a lot about the so-called ‘bubble’ that everyone is talking about. Read on, and I appreciate any feedback you may have:
“In either a bearish or bullish market, houses must be brokered and represented. However, a falling housing market may increase or decrease sold inventory. That is, if the market falls 10% to 20%, will it double the size of your listing board, or halve it? I do not know. There are investors like me, who may be silent and still for the many months to come. However, when the time is right, I will step up and may pick off 3 units at one offer writing sit down. Furthermore, I know many investors with hundreds of thousands of dollars on the sidelines waiting for a break in the action to re-invest. 1997 to 2000: My younger brother was an account vice president with UBS Financial Services. When the markets were on fire he was getting nothing but buy orders. His clients did NOT care what something cost, just demanded that he buy them. His commissions were HUGE. Clients were making so much money they did not look at their commission charges. In addition, with the huge bullish outlook on the market, hedge funds roared up again. Hedge funds trade call and put options. Once again, there was HEAVY option trading, my brother made a fortune. No one was questioning their commissions or the speculative nature of their investment. 2000 to 2004: Times were tough. Clients lost their children's trust fund money. Retired folks were figuring out a way to go back to work. Lawsuits were being filed against UBS Financial Services accusing them of improper trading and financial advice. The finger pointing began. Clients who still purchased stock were watching the commissions they were paying with a hawk like eye. "Full boat" commissions were now being reduced to $60 minimum trade amounts. Sell orders were being filled for gratis since so many were being sold for less than 1/2 what they bought it. 2005: After years of waiting for the stock market to rebound many clients of UBS suing more and more. They began to attack the brokers for putting them into speculative stocks. Retired clients who were hedge fund investing got wiped out. Fathers lost their children trust fund given to them by their grandparents. I have heard all the stories from my brother. The finger pointing had began. Greed over took these people and the ignored all market fundamentals. Much of the new money was new investors just pouring whatever money they could into the market. This is what happened when un-educated and non-seasoned investors dump more capital into the system. Years ago I remember all the articles on "DAY TRADERS". There was article after article about folks who quit their jobs to become day traders. There were stories of teenagers making six figure trades from the portfolio they built up. "Day trading" was the new way of making money. It seemed so simple. "DAY TRADERS" and are now in real estate. The "day trader" mentality is at work. In Arizona, many of the homes being purchased in the town I own land in are by out of state buyers. My $2,400 an acre land increased to $20,000 in 30 months, of which, $10,000 of the gain was in the last 6 months. It defies logic and fundamentals. A "day trader" was not interested in the PE ratio of a given stock, nor its beta curve, yield or PPE. They expected it to be worth more not only the next day, but the next hour. Today's "Day Trader" is the property flipper. This is the guy who buys a building for $500,000 and doesn't care that it runs in the red.....he will be able to resell it more next month. Today's buyer are concerned what their property will be worth next month! Next month!!! I wonder what my property will be worth in 2015, 2025, 2040, 2050. "Day traders" worried about what their stock would be worth the next hour. Today's property folks worry about their value next month. They are birds of the same feather. I do not care what my Caterpillar, General Electric or Phillip Morris stock does in the next 5 or 10 years - I care what their performance is over my 40 investment horizon. At the same time collecting and reinvesting their dividends. The "day traders" got caught with their hand in the cookie jar 5 years ago. It may happen again. Speculative buying the antithesis of fundamental buying. Fundamentals eventually always rule the day. They have for more than 100 years.”
So now, what kind of investor are you?
----------------------------------------------------------------- From the News -----------------------------------------------------------------
Each month, I publish a series of articles of interest to homeowners- money-saving tips, household safety checklists, home improvement advice, real estate insider secrets, etc. Information that won’t fit in this newsletter, check it out:
http://www.vancouverrealestateinfo.ca/redir.asp?page=gold_newsletter.asp&t=list
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Thanks for Reading!
D'Arcy R. Harris Real Estate Broker Sutton Group - Westcoast Realty
Tel: 604 484 6236 Fax: 604 488 0885 darcy@darcyharris.com
Quote of the week:
Watch what people are cynical about, and one can often discover what they lack. Harry Emerson Fosdick, 1878 - 1969 -----------------------------------------------------------------
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