Many of us think Victoria Real Estate prices are very high. As we have mentioned in many blogs previously we think Victoria Real Estate prices will still climb. We predict that the average prices by the end of this year (2008) will reach $650,000. A recent article in the Times Colonist by Andrew A. Duffy reads:
Victoria still ‘undervalued’ in coastal terms: developer
The sub-prime mortgage crisis that has contributed to an economic slowdown in the United States is unlikely to be experienced north of the border, according to developer Ken Mariash. Speaking to an Urban Development Institute luncheon yesterday, Mariash, who is building the massive $1.2-billion Bayview condominium project on the Songhees — one of the largest in the province, credited the Canadian banking system for maintaining the housing and development sector as a strong economic engine.
Mariash said the U.S. system features thousands of lenders and hundreds of thousands of mortgage brokers, which he argued leads down the path to 100 per cent financing — and trouble.
He also pointed out the Canadian system tends to be much more conservative and does not tend to finance any more than 75 per cent of a home’s appraised value.
Mariash had an ally in Tom Siemens, regional vice-president of RBC Royal Bank.
During a rundown of the Canadian economic outlook, Siemens pointed out the sub-prime mortgage crisis is simply a case of people who didn’t warrant the mortgage in the first place defaulting on their obligations.
He said the delinquency rate in the U.S. has hit 20 per cent while in Canada that number is less than five per cent.
Both men told a standing-room-only crowd that while Canada will miss that storm, there is a cooling of the economy in the wind.
“But Victoria, I think, is going to be stable,” said Mariash, of the development side of the equation.
“It won’t be the same we have seen over the last three or four years.”
Mariash still sees plenty of opportunity in Victoria, a market he argues is not oversupplied with new development and is just now coming into its own.
“I think Victoria is probably underpriced,” he said during an interview, noting in Vancouver you would pay $1,500 per square foot for a glimpse of water while in Victoria you’re looking at $700.
“I don’t see Vancouver as being worth twice Victoria.”
He believes there are as many as three million Canadians who want a window on the west coast.
And while the pace will slow here over the next year or so, he thinks many of them will find Victoria.
“If I’m sitting in Calgary or Winnipeg and I want a place to go that is a little warmer and get away from 40-below weather, I have choice … I can go to Vancouver and battle for road space or go to Victoria and for $700 a square foot space. Frankly I say Victoria is undervalued.” End of Article. Andrew A Duffy can be reached at firstname.lastname@example.org
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Anders Treiberg, Associate Broker, REALTOR®
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