How today’s further cut in interest rates will affect our local Invermere real estate
The article below is indicating to me that this year may be the perfect storm to buy real estate. With interest rates already at historic lows and forecast to go even lower, there is a fantastic buying opportunity for leveraged real estate buying in 2009. During the last two major recessions interest rates were through the roof so using leverage to buy real estate during those times did not make any sense. This scenario we have now, however, is completely different. Low interest rates coupled with a huge influx of billions of dollars of liquidity by US and Canada governments into our economies may soon lead to a rapid reversal of trends with inflation coming back and interest rates jumping. With real estate prices already significantly reduced and lots of money soon to be injected into the economy now is the time to be buying leveraged real estate in the Columbia Valley which includes Fairmont, Radium, Invermere, Windermere, and Panorama.

Bank of Canada cuts interest rates again in January Published January 20, 2009 CREA As widely expected, the Bank of Canada lowered its benchmark overnight lending rate by a half of a percentage. The Bank acknowledged the global economy has deteriorated further since it last lowered rates in December 2008, when it announced Canada had entered a recession. “Major advanced economies, including Canada’s, are now in recession and emerging-market economies are increasingly affected,” said the Bank when it again lowered interest rates on January 20th. The Bank has repeatedly lowered its policy interest rate to support economic growth. Since December 2007, the Bank has cut its overnight lending rate by a total of 3.5 per cent. “The Canadian economy is widely expected to begin growing in the second half of 2009, as government spending and easier credit begins to lift economic growth,” said CREA Chief Economist Gregory Klump. “Business and consumer confidence are unlikely to improve much until such evidence appears.” The Bank downwardly revised its forecast for economic growth in 2009, but revised it upward for 2010. It also pushed the goalposts out to the middle of 2011 as to when it expects inflation to climb back to the two per cent midpoint of its target range between one and three per cent. The Bank targets the core rate of inflation at two per cent. The rate has stayed below the target level since October 2007. “The Bank’s revised forecast for economic growth and inflation means it won’t raise interest rates anytime this year, but credit conditions have tightened, which will mute the benefit of the Bank of Canada’s recent interest rate cuts for consumers, business, and the economy,” said Klump. Echoing previous messages about for the potential for additional interest rate cuts when it next meets in March to set its policy interest rates, the Bank also said it “will continue to monitor carefully economic and financial developments in judging to what extent further monetary stimulus will be required to achieve the two per cent inflation target over the medium term.” When the Bank cut interest rates on January 20th, the advertised five-year conventional mortgage rate stood at 6.75 per cent. This is down 0.74 per cent from one year earlier, and 0.2 per cent below where it stood when the Bank made its previous interest rate announcement on December 9th, 2008. The ongoing credit crunch has led mortgage lenders to reduce discounts on advertised mortgage interest rates, and in some cases these have been completely eliminated. “Sales activity and prices will decline this year, as many buyers hunker down and put off buying decisions during the economic recession,” said Klump. “Housing market prospects will improve in 2010 in tandem with a rebound in economic growth.” (CREA 20/01/2009)
Posted Thursday, January 22, 2009 4:20 PM by Ross Newhouse

Deals of the Month for Invermere, Windermere, Fairmont, Radium or Panorama
Yesterday at our weekly sales meeting we had each REALTOR identify one of their listings in Invermere, Radium, Windermere, Radium, Fairmont, Panorama or the rest of the Columbia Valley which they felt represented an excellent value. One of them was the house which I reported as my first sale in 2009 in my blog last week. Another is one of my listings which I am expecting an offer shortly through one of our REALTORS. In my opinion this activity is indicative of the fact our market is obviously slow but properly priced listings do attract Buyers regardless of market conditions. I have started a new page on my website to feature four listings which I or my colleagues feel represent excellent value.
Posted Wednesday, January 14, 2009 2:03 PM by Ross Newhouse

Kootenay Real Estate Board Statistics 2008
The Kootenay Real Estate Board recently released their statistical analysis of real estate sales and listing activity for 2008. This includes our trading area of East Kootenay which comprises the communities of Invermere, Windermere, Fairmont Hot Springs, Radium Hot Springs, Panorama, Toby Benches, Wilmer, Canal Flats, Columbia Lake, Edgewater, Brisco, Spur Valley, Spillimachean and the rest of the Columbia Valley. These stats confirm my gut feel that we have now been in a slow down in our marketplace for about a year and a half now. Our particular trading area is the only one in the East Kootenays that showed prices decreasing over this period of time. While this is somewhat worrisome for real estate owners I do feel very optimistic that the price decreases we have seen will put this area in good stead in the future as prices become more affordable than other areas. For astute buyers this is the time to be picking up some real assets at excellent values.
Posted Wednesday, January 07, 2009 12:52 PM by Ross Newhouse

Ozzie Jurock says: “We’ll be fine in 2009″
Ozzie Jurock, British Columbia’s best known real estate consultant and investor, has seen housing and financial crashes before and he is confident B.C. will ride out the current downturn with ease.
In 1992, Jurock notes, some 787 U.S. banks had collapsed amidst the savings and loan crisis. At that time, Jurock was buying real estate and urging his clients to do the same.
“It was an easy call to make,” Jurock said. “Just as easy a call to make for real estate values now, because the fact is that values grow where people want to go … and people want to live and play here in Western Canada.”
“In today’s gloomy environment we must remember that urban real estate always has a use and thus always has a strong asset value.
“We like all urban real estate in Western Canada from Edmonton to Vancouver and most everything in between. No matter the short-term gyrations, urban properties have been a spectacular investment. Downtown used condos on Howe Street rose from $95,000 in 2001 to $350,000 in 2008. The average house price climbed from $16,000 to $700,000 in Vancouver over the last 40 years.
“But we did not get there in a straight line,” he said.
In Western Canada for 2009, Jurock said he is only concerned about Saskatchewan, “where volumes are slowing, inventory is soaring, and prices are bound to reverse sharply.”
“On average for 2009 we look for prices to firm in Edmonton and go down in Calgary by a a further eight per cent, and Vancouver by 10 per cent.”
He cautions that overbuilt condo areas – he singled out downtown Calgary and Vancouver and the Okanagan – will see sharper price decline.
“Recreational areas will not escape as they always follow – down or up – markets in the major cities. Previous downturns have lasted from one to three years and seen an average of some 17 per cent decline from top to bottom. I would not be surprised to see that this time also.”
However, Jurock recommends buying waterfront. He notes that there are now 67 waterfront homes for sale on the Sunshine Coast, up tenfold from a year ago.
From an investor’s perspective, Jurock said, “we like cash-flowing properties anywhere there is a good employment base, low vacancies, capital investment and a good price-to-rent ratio.”
His picks for such markets include Edmonton, the Kootenays and a number of smaller centres in both Alberta and B.C.
“From a home purchase perspective there will be some great deals in new construction [in 2009],” he added.
Jurock believes that we are in the midst of the most unreported inflation of all times, “because we print more money than ever. All that extra cash created out of thin air will continue to compete with the money you and I make and drive hard asset prices, like real estate, eventually higher again.”
“Don’t worry,” Jurock said. “The best deals come in down markets. On the way up, risk increases every day. On the way down, it decreases every day.”
His final advice: work with a sharp Realtor, do your research and make an offer.
Posted Tuesday, January 06, 2009 1:43 PM by

2009 Starts with a bang!
Based on my activity on my website, buyer inquiries and my first sale of 2009 already in the books, 2009 could end up being much better than I expected.
Posted Tuesday, January 06, 2009 10:27 AM by Ross Newhouse