In some major Canadian markets, the hot real estate market has given rise to a practice that’s intended to stimulate interest in a listing and achieve the highest possible sale price in a short period of time. What is it? It’s under-pricing the listing. Intentionally listing properties at well below their market value and then holding off on showings or offers until a specified date can create a ‘bidding war’ scenario where multiple buyers eagerly scramble to get in on a ‘great deal’.

It’s a strategy that’s continuing despite what is now becoming a more balanced market across Canada. Even though the pace of sales in Canadian markets is falling behind last year’s record-breaking number of transactions, prices continue to rise. Now, a dramatic increase in the number of new listings in recent months has resulted in a more balanced market than we’ve seen in years. Nevertheless, homes in highly sought-after neighbourhoods will always be in demand, and these are the homes where the under-pricing strategy is most prevalent.

While the under-priced listing can sometimes deliver a good end result for the seller, it can also result in a great deal of wasted time dealing with prospective buyers who may be able to afford the undervalued list price, but who cannot afford what the house is actually expected to sell for. Frustrated buyers are dealing with mortgage lenders and sometimes even paying for home inspections on properties they ultimately will never be able to buy. Under-priced listings can become a waste of time for buyers and sellers alike.

So as a buyer, how can you be sure that you’re not wasting time, money or effort making an offer on a home you can't afford? Of course, you could simply avoid properties that seem obviously under-priced or are holding out for offers. That’s a scenario that no seller wants, and the risk of it happening is increasing as the market cools and there are more listings for buyers to choose from. But there’s a better way for buyers to know the expected sale price of a property – and that’s where your local REALTOR® comes in.

Before deciding to pursue an offer on a property, ask your sales representative to prepare a Comparative Market Analysis (CMA) for you. This report will show you recent sales for comparable properties in the area, as well as current listings and expired listings. Armed with this information and some advice from your Coldwell Banker sales professional you can determine an estimated price range for a listing and choose to make a realistic offer or move on to another listing.

Whilst this practice is not prevalent in the Kelowna market place, there are other creative offerings that Buyers should be aware of. Contact us for more information.

In more ways than one, REALTORS® are working hard for you. In the current market, as a Seller you are looking for creative solutions to market exposure and additional ways to bring people through your property. If you are a Buyer, you have a lot of choice and need a REALTOR® who can efficiently identify the best options for you and spend the time to assist in viewing and then effectively negotiate a successful purchase for you.

There is no doubt that most real estate professionals are working harder to earn your business at the moment, but are you familiar with how those REALTORS® impact your local community or service clubs in their spare time? If you are, your local Real Estate Board would like to know in the next few months. If you don't, I would encourage you to find out from your trusted real estate advisor how they volunteer or contribute to local events and organisations.

Across the country, several real estate boards have implemented a recognition program for REALTORS® who have excelled in their community involvement. The program is called Realtors Care and each year, locally, you have a chance to nominate REALTORS® for this award. In the next few months you will see adverts in the media and announcements on the OMREB web site (www.OMREB.com) calling for nominations for potential candidates. A panel of independent judges from the community will then select up to two men and two women to receive the award.

Past winners have included George Cwiklewski from MacDonald Realty, Bud McGrath from Remax, Corry Perret from Remax and Dino Gini from Realty Executives. Whether it was volunteering time to coordinate very successful Rotary Club projects overseas or rallying an office to make record-breaking contributions to Charities, all of these professionals deserved the recognition they received.

Watch out for the adverts coming out soon with instructions on how to nominate the REALTOR® of your choice.

Personally, I am heading off to South Africa next month to participate in a 3,500km Charity Enduro ride across that beautiful country. We will be raising money for the Nelson Mandela Children’s fund, UNICEF and purchasing the motorbike that we ride that will then be left with an African Charity to put to good use with health professionals who can use them to travel in remote locations. Any donations would be gratefully accepted as I endeavour to raise $10,000 and expenses for the various charities involved. It will be an exciting and tiring time, but it will also give me a chance to visit a few other real estate centres on my travels and bring back some interesting information in October from other parts of the world.

Board stats continue to show reduced sales quantities and whilst we see discounts on various listings, the stats are indicating that prices are still holding firm in most of the categories. We have seen an increase in activity in the past few weeks and I would expect the fall to be a busy time with people making an end of summer decision after visiting here earlier in the year.

We will be bringing you a more detailed market analysis in the next article.

Canadians wondering about the real estate market can look forward to strong sales throughout the rest of this year. At least, so says the latest residential forecast released by the Canadian Real Estate Association (CREA).

According to CREA, national MLS® home sales activity will remain strong in 2008 despite trending lower from record-level activity last year. In fact, national home sales are forecast to ease 11.5% from last year’s record-breaking pace to total 460,900 units in 2008, and are expected to ease a further 4% the following year. Yet despite moderating slightly from the previous year, the important news is that these totals represent some of the best years on record in Canadian real estate.

Resale home prices are forecast to set new records in every province this year and next, but price gains will be smaller percentages than in recent years. The MLS® residential average price is forecast to rise 5.3% nationally in 2008 and a further 4.2% next year, pushing prices to new heights. Price gains will gradually become smaller as the resale housing market becomes more balanced.

On the provincial level, MLS® home sales are forecast to ease gradually in all provinces in 2008, but record-level activity in Saskatchewan and Newfoundland & Labrador during the first quarter will result in new annual records in these provinces. New listings are forecast to rise in all provinces. The gradual decline in sales activity combined with an increase in new listings will result in a more balanced resale housing market. The market is forecast to remain tightest in Saskatchewan and Manitoba, and as a result price increases in the Prairie provinces will be biggest.

The Canadian resale housing market is continuing on a distinctly different path than the U.S. market, says CREA. The forecast growth in average resale home price for Canada stands in stark contrast to the U.S. housing market, where prices and sales activity are on the decline. CREA credits growth in after-tax income, strong employment and short-term interest rate cuts for our strong 2008 market forecast. These factors will support housing demand, despite further home price increases and increasing economic uncertainty that are wearing on consumer sentiment about making major purchases such as a car or home.

Of course, this is only the national picture and some provincial forecasts. If you’re thinking of buying or selling a home, you’ll want to know the outlook for your local market. As your local REALTOR® will tell you, prices and sales activity can vary dramatically within the same community, between neighbourhoods, or even from street to street. You’ll need a proven professional to help guide you through the process and arm you with the right information to make informed decisions. Why not contact us and find out how to work today’s market to your advantage.

Having just finished one of the most productive and busy two week periods this year I can tacitly say that interest in the Okanagan as a "lifestyle" destination is not waning at all.

It is not easy being a REALTOR® at the moment. Clients like to hear your forecast and market predictions and yet we are living in a time of instability and unpredictability from a global perspective that is confusing many learned economists.

If your REALTOR® looks at the most recent board stats, then they will be able to advise you that listing periods are significantly longer than last year, the number of listings are up significantly and prices are remaining relatively stable.

What is interesting about the present market place is how many people are “testing the waters” with a listing. There is a saying that a rising tide floats all ships, that rising tide however was last year and perhaps it was an extreme “spring tide” but now is not the time to test the water. If you don't need to sell, hold on for a while, the results may surprise you.

In my articles, a few people have said that I focus on resorts and tourism and less on real estate. I find the opposite to be true. Resorts and tourism is the future of the valley outside of an service industry for an aging population. As tourism increases, so will the pace and value of real estate, across the board.

If you were a major developer looking for a place to start your next real estate project, you would typically look at key indicators such as job statistics, in bound migration, tourism demand for the region, transportation access, vacancy rates and one or two other key parameters. If you analyze the Okanagan, it gets positive check marks in most of these columns. As we deal with the present challenges of a U.S. economy that will get worse before it gets better and oil prices that as we have maintained, are yet to surface at a consumer level with the price of almost all goods, not just the price at the pump we will also see that this area is a magnificent area to spend the rest of your life in retirement or for recreation.

The upside for you as a “retail” real estate client is that I believe that financing in the development industry is going to be difficult to access for more than a few months. We have already seen a few new developments go on hold and a few more will follow. The good news is the appetite for buying here will remain. I would expect sales volumes and values to increase over the summer months as people make critical buying decisions, particularly in the more balanced market we have today. That will have a positive impact on the resale market that we have all been watching so carefully.

We are also seeing investments in attractive tourism properties and destinations. The Grand Hotel is rumoured to be in the final throws of discussions with Delta Hotels who would no doubt have plans to turn the property into a flagship resort hotel for them. Marriott has been looking at the Vintage Landing project for a possible Ritz Carlton location and there are rumours of Fairmont Hotels looking at the region also. One of our first articles we posted on Castanet had to do with the evolution of branded hotels in Kelowna. This is part of (and a very important part) Kelowna's transition to a tourism economy. With it comes an increased awareness of the region and all it has to offer, better occupancies in the hotels and more in bound migration as a result. There are also rumours of a major alliance in the works at Mount Baldy, the areas newly expanded ski operation.

In my office, activity has picked up considerably, not that it needed to. In terms of sales activity, we are almost a mirror image of last year's activity, however, the summer season is upon us and Albertans are travelling again with a view to spending a nice vacation here this year and perhaps for many more years into the future.

Kelowna is known for sun and warmth, something that retirees are attracted to in many instances. Remember that if a retiree is looking to buy and has perhaps 20 years productive life remaining, giving up a buying opportunity this summer is like saying good-bye to 5% of warm summers, that is a significant reduction in quality of life in my mind. The only downside to the Alberta migration to BC is the Alberta government's recent royalty program which is having a marked impact on corporate activity in Alberta, with corporations choosing to head-quarter in Texas which has always had very strong ties with our cousins to the East.

Overall, CMHC is still bullish on BC compared to other markets and our feeling is that the Okanagan will fair well this year in comparison to other major urban markets across Canada. This quote is from a recent Vancouver Sun article:

“B.C. numbers being released today show that the province has largely dodged the price rollback, with the average B.C. residential price for June up 3.9 per cent from the same month last year, to $463,458.

For the first six months of the year, seasonally adjusted unit sales for the province were down almost 22 per cent to 42,907 units, while the average price was up 9.6 per cent to $473,536 compared to the first six months of 2007.”

I hope you are enjoying the summer. It won't last too long and neither will the slow down in the housing markets.