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Most expensive listing sees biggest price drop

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Anyone remember a story about the most expensive real estate listing in all of Canada?
It made news first for the obvious reason: most expensive property in the country!

Then it made some blogging news because the pictures of the really weird house turned out to be imaginary.

But you got to figure with all that nation wide exposure it must have sold for a pretty sum right?

Well not exactly.

As observer points out that’s a $25 million (or 66 percent!) price drop in less than a year!

Surely at that rate we must have the biggest asking price collapse in all of Canada here.

If you’re into extrapolation this means that in one year they’ll pay you six figures to take it off their hands.

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Xhdh
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Fucking this site and all the lying Fuckers on it!

Move out of your mommas home!

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3 years 11 months ago
patriotz
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Canada’s housing market among most ‘bubbly’ in world, Economist finds

It was the Economist, of course, that produced the classic report in 2005 that identified the global housing bubble and predicted severe consequences.

Canada’s housing market is still among the frothiest in the world, more than a year after the federal government moved to head off a bursting bubble, findings by The Economist suggest.

Of course the findings by the Economist show that the federal government never intended to “head off” a bubble in the first place.

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3 years 11 months ago
VMD
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Regulator eyes tighter mortgage rules
Sep. 03 2013
Canada’s banking regulator has been gathering detailed mortgage information from financial institutions, in what could be a precursor to changes in the rules for home loans.

The Office of the Superintendent of Financial Institutions (OSFI) has spent months considering a tightening of mortgage rules for lenders, a decision that’s being weighed as the housing market begins to pick up after a year-long slump. That slide began when Finance Minister Jim Flaherty tightened the rules for mortgage insurance in July, 2012.

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3 years 11 months ago
KopyrightKlepto
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This property appears to have been subdivided. The original listing was 34k sqft, and the current listing is 26k.

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3 years 11 months ago
RealityCheck
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Can’t believe that this post below got downvoted yesterday. Wow, some people really detached from reality and borderline delusional. One commenter even suggested that a lot could go down to ZERO value. DELUSIONAL. Give me these $380K lots for $280k and I’ll buy them all!

“2013 Central Surrey: New house costs $680K

–> Lot 380K, Building $300K

2002 Central Surrey: New house costs $320K

—> Lot 170K, Building 150K

Therefore, Lot price increased by 210K and Building costs by $150K.

Now, where can these values possibly crash to? If land values fall by a catastrophic 33%, then new builds like this will fall to $551K. There simply isn’t any building lots left.

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3 years 11 months ago
RealityCheck
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XhDh:

Leave out the foul language.

However, I do agree that most visitors to this site are indeed delusional with respect to the 50%+ correction they think will happen. See above post.

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3 years 11 months ago
Softy
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“This property appears to have been subdivided. The original listing was 34k sqft, and the current listing is 26k.”

It is more likely that the listing agent got the information wrong intitially.

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3 years 11 months ago
Devore
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@RealityCheck: why are you comparing against 2002? Who cares about 2002? 2002 was just the very beginning of the real estate bull market where buying made perfect sense vs renting, which around 2006 turned into a flat out bubble.

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3 years 11 months ago
jesse
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“Lot 380K, Building $300K”

If the rent on the existing structure is high enough compared to the rent received after redevelopment costs, perhaps it’s not quite ready for said redevelopment. I might suggest your comparison needs some time discounting.

What was Buffett’s line again?

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3 years 11 months ago
RealityCheck
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Devore: Why not? You guys do it all the time when you say that prices have gone up by X amount over 10 years. Who cares about rent ratios?? IT IS NOT ABOUT YOU ANYMORE! Rent ratios don’t matter in a globalized world. Once you own a plot of land after 25 years, it is yours, your kids, your grand kids, etc., In your view, San Diego is a huge bubble …rents way out of whack with prices. Laughable really. Jesse, Jesse, Jesse: I think you will always be a renter. You see the glass as half empty always. My circle that rents would buy in a heartbeat if prices in Surrey fell by $75,000. There is huge pent up demand at this price level. I’m glad I won’t have too much competition to buy on the next down cycle.… Read more »
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3 years 11 months ago
BWilson
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“Rent ratios don’t matter in a globalized world”

Good one.. why would anyone look at the cost of a substitute when looking to purchase a product?

Classic bubblespeak.

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3 years 11 months ago
UBC in crisis mode
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Who has Van West sales data for July and August?

From one web site, Van West:

Month / New listing /Sale

July / 292 / 120
Aug / 120 / 20

20 is pretty low?

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3 years 11 months ago
crabman
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” “2013 Central Surrey: New house costs $680K

–> Lot 380K, Building $300K

2002 Central Surrey: New house costs $320K

—> Lot 170K, Building 150K”

Inflation since 2002 has been about 30%. So 2002 prices adjusted for inflation would be:

–> Lot 220K, Building $195K, for a total of 415K.

Your “catastrophic crash” value is still 33% above inflation.

P.S. I love the comment about Surrey having run out of land!

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3 years 11 months ago
Son of Ponzi
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Fellow bears!
The lazy, hazy days of summer are over.
The kids are back at school.
Traffic congestion is also back with a vengeance.
Did I mention the rain.
People are back behind their desks, collecting their meager paycheques, wondering why the heck they just bought an overpriced shack that will burden them financially for most of the rest of their lifes.
Bye,bye summer vacations, new car and decent clothes.
Hello, leaky roof, broken down fence and appliances.
And then the horror of seeing your equity going down the drain either quickly as this giant RE bubble bursts or slowly through a thousand price cuts.

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3 years 11 months ago
YVR
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RealtyCheck: “Now, where can these values possibly crash to?” It depends on how much rent or net income the 680K property can generate. If the house rents for $2000 per month then a good guess would be 240K to 360K which falls into the 10 to 15 price to rent range. Once the house is built the cost of building it is irrelevant. A perfect example is the Olympic Village. The developer went bankrupt because their cost to build it was higher than buyers were willing to pay. During bubbles building costs go up because of demand for the trades, etc. Once the bubble bursts the cost to build those OSB houses in Surrey will be significantly less. Trades peoples wages will go down, builders margins will go down and land values will plummet. There were plenty of houses sold… Read more »
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3 years 11 months ago
YVR
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RealtyCheck: “My circle that rents would buy in a heartbeat if prices in Surrey fell by $75,000. There is huge pent up demand at this price level.”

You are correct there will be lots of people that WANT to buy once prices are down another $75,000. The problem is most if those people will have already bought and or will not be able to get financing to buy. That is why the prices go down in the first place. Because the bubble runs out of greater fools who can get a mortgage.

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3 years 11 months ago
Seafair Dweller
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Here is a link to the Economist’s latest article on global house prices. As in past articles, it indicates Canada’s market is overvalued.

http://www.economist.com/news/finance-and-economics/21584361-america-surges-much-europe-sinks-mixed-messages

Note that the % overvalued (compared to rent) figure represents a comparison of current real estate values and rental rates to their historical averages, NOT a comparison of the cost of owning versus the cost of renting.

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3 years 11 months ago
Aggregator
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“Once you own a plot of land after 25 years, it is yours, your kids”

LOL…By that time at the current tax vs income growth rate, your kids will be paying 15% of their income on property taxes alone. http://i.cubeupload.com/6tQnFz.png

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3 years 11 months ago
An Observer
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KopyrightKlepto

It wasn’t subdivided. Look at the current description “26,000 +/- sqft(according to BC Assessment-with notice of possible change) offering approximately (subject to change feet) of waterfront”

Original realtor or seller got the size wrong – too busy making fake pictures

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3 years 11 months ago
snake
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Can somebody explain WTF this realtor is smoking to come with price change?

http://univs.ca/property/mp-mount-pleasant-ve-vancouver-east-greater-vancouver-vancouver-bc-v6a-4h8/

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3 years 11 months ago
Many Franks
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@snake: Ever see a paramedic apply a defibrillator to a dead body? It’s pretty much the same thing.

The difference is that a paramedic will have given up by the time 6 months roll by.

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3 years 11 months ago
Son of Ponzi
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Aggregator # 18
Agree, rising property taxes will take a heavy toll on homeowers in the future.
Upgrades to dykes and earthquake protection costs will be in the millions.
Richmond estimates that these costs will be about 180 million just for Richmond.
http://www.richmond-news.com/news/new-provincial-dyke-standards-to-hurt-richmond-budget-1.498755

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3 years 11 months ago
Saver
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LOL, Many Franks, you crack me up.

@snake, scroll down and see price change history: 120k up, 120k down, 120k up, 120k down since March..LOL, dead corpse.

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3 years 11 months ago
Son of Ponzi
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The Realtor’s name is T.S. Mock.
That should explain it.

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3 years 11 months ago
so suit me
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S&P says US government’s lawsuit is “retaliation”

Standard & Poor’s says the U.S. government sued the ratings agency as “retaliation” for its downgrade of the country’s credit rating.

The Department of Justice filed civil charges against the rating agency in February and is seeking $5 billion in penalties.

The government claims S&P refused to warn investors that the housing market was collapsing because it would be bad for business. It also says S&P knowingly inflated ratings of risky mortgage investments that helped trigger an economic crisis.

S&P denies the claims and said in a court filing that it is being sued in retaliation for a downgrade of the country’s top-tier credit rating in 2011.

AP wire Sept 3, 2013

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3 years 11 months ago
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