Prices of single family homes continue to rise in Nanaimo at a surprising rate! Although unit sales were down 13%, the average price increased to $373,134, up from $325,613 last April, an increase of 15%. To put this in perspective: if you had purchased a home or rental property last April for $300,000 and put $30,000 down, you would have realized a profit of $45,000, a return-on-investment of 150% in one year! Continued yearly increases of even just 5% would give you a return of 50% on your original $30,000 each year. This, in my opinion, is the correct way to gauge your investment returns. The percentage increase should be based on what you actually have invested, rather than on the price paid. Remember, you would be paying rent in any event. This way you would be realizing the profit rather than the landlord. This also applies to rental investment properties. The tenants, depending on your downpayment, would be paying (and paying down) the mortgage for you, with yearly rent increases further enhancing your rate of return. The rental situation remains critical with the vacancy rate hovering around 1%. This keeps upward presure on rents and home prices.
Although our national economy is stalling and may yet slip into a mild but brief recession, B.C. continues to enjoy a bouyant outlook. Information filtering up from the U.S. shows that some of the hardest hit areas, such as California and Arizona, have experienced recent home-sale price increases of up to 15% in some areas, a sign that consumers feel that the bottom has been reached. The economic stimulus recently put in place in the U.S. and Canada appears, despite some fear-mongering, to be taking hold. This bodes well for a quicker-than-anticipated recovery. In turn, this recovery will place even more demands on our natural resources, further enhancing the economic outlook for B.C.
Additional information from the Vancouver Island real Estate Board is as follows:
1. New listings are about the same as last year, however, lower unit sales are providing a larger inventory to choose from.
2. Average days-t0-sell are 50, slightly longer than the same period last year (46).
3. Properly priced homes are selling within 3% of asking price.
If you have questions on any of the above, or would like a private, no-obligation consultation about your Real Estate needs, please contact me at 751-1223 or homes@kenxwestfall.com. It would be my pleasure to assist you!
HELP!
On another note, our Rotary Club is collecting good books and records for our 2nd annual Fall book-and-record-sale with the proceeds going in support of local community projects, including the Canwest Raise-A-Reader program. Due to lack of interest last year, we are excluding textbooks, encyclopedias and magazines. We have various drop-off locations (Nanaimo North Town Centre, Nanaimo Daily News and the Brewers Wort). However, if it is more convenient, I'll be happy to pick up any donations, at your convenience. Just contact me at 751-1223 or homes@kenxwestfall.com.
Thanks, in advance, for your help!
Best regards,
Ken X. Westfall |
