Vancouver Condo Info

Its Friday here and that means open-topic time with a cornucopia of links:

-Vancouver the most overtaxed place for business
-Hydro rates to jump 11% over 3 years
-”What is ordinary may change in the future“
-Another round of layoffs at Canfor.
-Canadian productivity growth at ‘depressing levels‘
-US Economic woes bode ill for Canada
-CMHC predicts higher prices in 2008
-US Credit rapidly drying up

What are you seeing out there? Post your news, links and anecdotes here!

A simple fool-proof debt management plan from SNL:

The Eden Group is cancelling two local development projects citing difficulty getting financing and skyrocketing construction costs. The Elyse, a 119-suite condominium complex at 7th and Scotia Street in Vancouver had pre-sold 55 units, but letters are now going out and deposits will be returned.

“The industry itself — very difficult to get financing,” Eden said on Monday. “Basically, it’s extremely uncertain whether I can actually complete that building.”

Eden is also cancelling a $30 million townhouse development, with that site already up for sale. A Third Eden project at 11th and Sophia is currently under construction and will be completed as planned.

Hmmm.. Now why would it be difficult to obtain financing in a booming real estate market?

Full story on the CBC website

The decline in the Dow Jones Industrial Average just past the 10% decline mark that denotes a ‘Correction’.

The swoon comes as investors were unnerved by another series of announcements that pointed to continuing problems in the credit markets, the result of home loan debt going bad under the weight of a faltering housing market.

So where are you putting your money? Stocks? Bonds? Vancouver Real Estate? Beanie Babies? (I hear they’re highly collectible). Just how is a fella supposed to get wealthy without any effort these days?

Quite a headline ain’t it? Don’t blame me, blame MSNBC: Mortgage meltdown’s nightmare scenario.

Some 2 million homeowners hold $600 billion of subprime adjustable-rate mortgage loans, known as ARMs, that are due to reset at higher amounts during the next eight months. Subprime loans are those made to people with poor credit. Not all these mortgages are in trouble, but homeowners who default or fall behind on payments could cause an economic shock of a type never seen before.

Some of the nation’s leading economic minds lay out a scenario that is frightening. Not only would the next wave of the mortgage crisis force people out of their homes, it might also spiral throughout the economy.

The already severe housing slump would be exacerbated by even more empty homes on the market, causing prices to plunge by up to 40 percent in once-hot real estate spots such as California, Nevada and Florida. Builders like Chicago’s Neumann Homes, which filed for bankruptcy protection this month, could go under. The top 10 global banks, which repackage loans into exotic securities such as collateralized debt obligations, or CDOs, could suffer far greater write-offs than the $75 billion already taken this year.

Unless you’re too busy waiting in line at the border to get some great deals on cheap plastic things in the USA, you may want to take part in our usual open topic Friday discussion here on VancouverCondo.info - Here are a few stories to kick off the discussion:

-Bleak friday for Canadian retailers
-Vancouver feels the effect of the writers strike
-BC Auditor general to review island land deal
-There are still slum-lords
-Abbotsford grow-ops sold
-Canadian banks face grilling on subprime charges
-US foreclosures bring crime wave
-Black friday halo dims on bleak 2008 outlook

So what are you seeing out there this week? Post your news, links and anecdotes here!

If you’ve seen billboards or newspapers inserts advertising real estate projects in Vancouver you may have noticed the strange disclaimer “This is not an offering for sale”. Seems odd to spend a bunch of money advertising something you’re not offering for sale doesn’t it? Why is this line of text omnipresent in presale advertisements?

Its all thanks to the Real Estate Developement Act which governs the marketing in British Columbia of development properties located anywhere in the world. The act limits marketing of projects without full disclosure but allows early marketing if the developer has obtained “approval in principle to construct or otherwise create the development unit from the appropriate municipal or other government authority” and “the superintendents permission to begin marketing”.

So in essence the act removes the right to advertise a condo or apartment before all the paperwork is in order, but then gives that right back as long as you assure people that this advertisement is not offering to sell you anything.

Ceci n’est pas une pipe?

Re-diculous posted a link to this story in the Vancouver Sun in the previous thread. Apparently some US owners of BC property are starting to cash out on their gains, particularly in light of the strong Canadian dollar. Is this a temporary adjustment or the start of a bigger trend?

Kelly said the activity amounts to only a handful of listings. But for some owners in Whistler - where property values have stagnated over the past few years - the recent gains for the dollar gives them a return on a property investment that hasn’t performed as well as they’d hoped.

Most of the article in anecdotal, but its backed up by some numbers from Landcor:

The net decline is just a blip, but Landcor’s numbers show that Americans sold property faster than they bought over the first 10 months of the year, and buying activity in 2007 has cooled compared with 2006.

Landcor counted 750 purchases by Americans registered in the land registry by the end of October, compared with 1,039 over the first 10 months of 2006. Matched against the net change in ownership, B.C. saw 933 more sales by Americans than purchases.

“So definitely, [Americans] are selling,” Landcor president Rudy Nielsen said in an interview.

Looks like a few people understand the ’sell high’ concept.

Friday free for all time! Here’s your open topic post for Friday November 16th 2007:

-Become a realtor.
-Vancouver condo sales slump.
-Divorce stokes the condo boom.
-Vancouver must heed warning signs.
-US slump worst since depression.
-US boom markets hit hard by foreclosures.

So what are you seeing out there? Post your news, links and anecdotes here!

Re/Max just released a survey stating that ’speculation’ is now the main driving force behind the condo market in Canada.

“The impact of speculation, especially in Canada’s largest condominium markets, has yet to be determined but concerns for the future are relevant,” said Elton Ash, regional executive vice-president of Re/Max of Western Canada. “This is a major factor that could influence prices in the years to come.”

Full story in the Financial Post.