The Gamblers: Know when to hold. Know when to fold. And they're folding.

On December 23rd we talked about 5575 Elm Street, a Vancouver westside property that had seen it's asking price reduced by over 20% but was still listed over $400,000 above the assessed value of the property.

We mentioned that 2013 will be the year many begin to accept that the values established over the past year are not coming back and that to sell, homes will have to be listed below assessed value.  

As Global TV noted, the price increases of the last decade are long gone.

Driving this new reality is that fact so many properties are already selling below assessed value. 

In November we told you about a westside house that had sold for 32% below assessed value. December hasn't seen a replication of this type of drop, but there have been numerous sales 5%-20% below assessed.

And when you have conditions where sales are down almost 30%, it shows you in which direction the market is heading.

Seeing the writing on the wall, more and more speculators getting out the market at a loss.

2171 S.W. Marine Drive is one of those properties:

Originally listed at $2,180,000, the house is assessed at $1,885,000. It just sold for $1,570,000 or -17% below assessed value. More significantly, the seller originally paid $1,700,000 in February 2011.  That's a loss of $130,000 (not including commissions and Property Transfer Tax or PTT) in only 22 months.

Then there is 1706 W. 59th Avenue:

The seller originally bought the house in August 2011 for $1,700,000.  It was listed for $1,790,000, it's assessed at $1,697,000 and it just sold for $1,600,000.

That's only -5% below assessed value but it's a loss of $100,000 (not including commissions and PTT) in only 16 months... and this seller' is counting his lucky stars he only lost that much.

There is 3721 W. 16th Ave:

They were asking $1,288,000, it is assessed at $1,200,000 and it just sold for $1,030,000 or -14% below assessed value.

How about 2718 W. 24th Ave:

Assessed at $1,864,000 it was on the market for $1,750,000 and recently sold for $1,580,000 or over -15% below assessed value. (A faithful reader advises this house sold in 1998 for $455,000, sold again in 2004 for $700,000.  With no changes to the house whatsoever, it has now sold for $1,580,000.)

Finally we bring you 4118 W. 13th Ave:

This house is assessed at $2,529,000.  The seller was originally asking $2,900,000 and accepted $2,308,000 earlier this month or -9% below assessed value.

As we go into 2013, homes on the westside of Vancouver are routinely selling for 5%-20% below assessed value.

In this environment, asking prices above assessed value are a non-starter. Is it any wonder speculators continue cut their losses and get out while they can?

Earlier this year pundits insisted Vancouver westside properties would hold their value. Then some told us the market would see a 5%-10% correction - at best while others were adamant that sellers would never sell for less than what their property was worth, let alone less than what they initially paid for it.

All of these claims were dead wrong.

All eyes are now firmly focused on the upcoming Spring market.

(hat tip timber2012 on RET)

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