Budget, economy, hype, presales, supply, west side

Condo marketer trades used cars for down payment

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51 Comments

People aren’t buying condos like they used to and that means marketers have to get creative.

For instance, how would you get first time buyers without much savings to buy in a new building with no parking available?

Trade their old car in for a 2% down payment!

Car for a Condo lets car owners trade in their vehicles towards a condo unit in the gritty but fast-gentrifying neighbourhood just west of Main.

“Cars are a terrible asset,” said Cam Good, president of real estate marketing firm Key Marketing.

“For someone trying to get started in life and wanting to become a homeowner, taking a depreciating asset and literally turning it into an appreciating asset is a life-changing decision.”

The low buy-in of $5,400 is possible thanks to a two-per-cent down payment program offered by Vancity.

It allows qualified buyers to shell out only two per cent of, say, a $269,800 one-bedroom, 519-square-foot unit — although monthly payments will be required over the next 16 months of construction to get the buyer to at least a five-per-cent deposit before the building is completed in 2016.

We’re still waiting for the offer that lets you trade in your used helicopter as a down payment on a new condo in Whiterock or the one that lets you trade in your imaginary foreign investor parents on a new unit in the gritty but fast-gentrifying neighbourhood downtown near the Granville street bridge.

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[…] VMD pointed out this interesting zoomable map of assessed property value changes over the last year in Vancouver. […]

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space889

With regard to Vancouver Price Drop, it nice to look at and all but remember they are just asking prices which may be unreasonable to start with. Garth had a good example recently in Toronto where someone named Khan marketed a “mansion” at $11M before dropping it down to $6M and portraying himself as being bankrupt and this mansion is a deal of a lifetime at 50% off. The reality is that the “mansion” is worth at most $6M in the first place.

As for the guy looking at his wife in the eye, I think it’s likely the wife’s decision to buy in the first place. I seriously doubt a guy would have bought with his wife seriously objecting to it.

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Turkey

Frances Bula: Property boom in Vancouver’s east end yields calls to rein in speculation. The escalation of east-side property values is raising fears that speculators are buying land at inflated prices. An industrial part of Mount Pleasant near Main Street and Broadway had the highest increase – about 30 per cent, as calculated by the B.C. Assessment Authority on the basis of recent sales. On one hand — there is a lot of light industrial in East Vancouver that’s been stuck in a holding pattern for decades. I rent an office in one such building; if it changes hands, I don’t expect my situation will change. This kind of “speculation” is just a transfer of wealth from one absentee landlord to another. On the other hand, developers will drive any rezoning and/or rebuilding that takes place. For better or worse,… Read more »

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Bull! Bull! Bull!

@2.79% 5 yr. NEVER AGAIN

>Hmmm…. that looks like a loss of about 18% over 7 yrs.
>Don’t tell Bull x 3. I don’t know how this owner be able to look his wife in eyes.

18% drop in what? asking price? lmao.

i don’t know how you’re able to look yourself in the mirror when you post things like this.

SMH

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2.79% 5 yr. NEVER AGAIN

From Price Drop:

Address:

# 802 33 W PENDER ST, Downtown, Vancouver West
October 06, 2006 V606457 $699,900
January 22, 2014 V104288 $575,000

Hmmm…. that looks like a loss of about 18% over 7 yrs.

Don’t tell Bull x 3. I don’t know how this owner be able to look his wife in eyes.

#6 ) Address:# 502 535 SMITHE ST, Downtown, Vancouver West

November 04, 2011 V918481 $1,195,000
January 22, 2014 V1042880 $899,900

24% drop over 3 yrs.

Don’t tell Softy that this is what our soft landing in condo’s looks like.

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paulb

New Listings 228
Price Changes 74
Sold Listings 80
TI:13366

For any real estate questions, find me here http://www.paulboenisch.com

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tedeastside

vancouver`s economy…..the worst in the free world!!!

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RaggedyRenter

Perfect storm would be:
CAD drops and Canada is no longer interesting as a store of value. Bond yield would go up and interest rate goes up.
Hot money just sloshed away from Vancouver because it’s no longer bimbo du jour. Maybe it’s the weather, the CRA, tightened migration rule due to the US demands but hopefully not due to increasing racial tension.
Lending standard gets tightened because now household debt is a big issue with bond yield upward pressure.
Right-to-work make it’s eventual debut in Canada.
Employment numbers may be up or stay the same but take home income would be hollowed out. What is the career option for $80,000 mail deliverer, or screwdriver specialist ?
As the US goes energy independent, energy prices crash.

I’m pretty sure somebody smarter have seen this coming already.

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RaggedyRenter

Prices (these days) are more tied to liquidity. Liquidity comes from loose lending standard, historic low interest rates, hot money, QE, drug money, HELOC, what have you. We live in a bizzaro-world where this slosh of liquidity jacked up Gold to $1800 and then punish it down to $1200. One year it pushes houses and stocks in emerging market (BRIC-ICIS) to crazy high level, the next it left town and destroyed the local market (see Rupee/Rupiah dropped almost 20% last year). We’re at the mercy of this fast moving current and it destroyed regular folks in their wake. Everybody knows that guy who just bought whatever is hot and got burned the next morning or the aforementioned people buying Van RE the past couple of years. What about Canadian dollar and the massive shorts it’s facing since December? -10% in… Read more »

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RaggedyRenter

Odd, my comment from this morning is stuck in moderation.
Let me repost in smaller chunks:

Here’s what I learnt the past 6 years.
Rents are always tied to income. Low income = low rent. There might be a couple of exceptions but as a system, low income locale = low rent. Owning in Vancouver might be too expensive but rent is reasonable.

Current prices aren’t tied to income they generate. Once apartments become acceptable as a long term homeownership vehicle, their price aren’t always determined by their rent.
Ditto house/land price. If you can destroy a couple of houses and build multiple dwellings, it will jack up the house price.
Determining prices based on the income/rent they generate will become crapshoot IMO, for reasons below.

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Funky monkey

Can anyone with tell me why new condos in Vancouver start at 269,$$$ it must be a wage thing.

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Egg Hunt

#37

Absolutely.
Rates don’t need to be up to pop bubble.
Canada is already in shaky economy,
I read in some paper before, only Canadians think Canada is all fine.

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Joe Mainlander

@ # 35 I didn’t infer that low interest didn’t start the bubble, just that you don’t need a rise in interest rates to pop a bubble.

I believe cheap money did fuel the bubble in Canada, US and elsewhere.

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BWilson

@ Rates #33 Yes, interest rates have come down quite a bit so far in 2014 (and even more from September). But you should be asking: why are rates coming down? And didn’t the US housing market crash in the face of lower interest rates? The reason why rates are lower is because of serious issues in emerging markets, particularly Turkey, Argentina and more importantly China, causing a risk-off trade. What is happening in China could be the early innings of a very severe credit crisis there, which does not bode well for the export of commodity products out of Canada as well as the flow of capital into Canada, the two largest drivers of our local economy (other than borrowing). So while rates dropping might provide a temporary boost to the real estate market, the reason why rates are… Read more »

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Egg Hunt

#34

True, it seems only Canadian real estate market is fuelled by
low interest rates. (if add, maybe Australia market, too)

In many countries, when interest rates are low,
bad economy coming, cold environment economically.
Only business has to be motivated to borrow, not personal.
Personal tend to save more, not to borrow.

I saw some comments in one of the American financial paper sometime ago,
one Canadian poster said now Canadian gov’t to keep interest rate low,
(or mortgage to be tightened at near future), people will
rush to borrow more.
I remember American posters seemed very puzzled.

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Joe Mainlander

The US housing market started falling in late 2005/early 2006, at a time of low interest rates. It wasn’t rates that caused that market to fall. Not sure if that was ever promoted as the boogeyman by any well know economists.

So what was the trigger in the US at that time? Nothing specific… just ran out of greater fools. Or as President Bush said when he was asked about rising house prices “When housing gets too expensive, people will stop buying houses” And they did.

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Rates! Rates! Rates!

what happened to the spiking rates boogeyman man? i don’t hear much about that anymore…

what’s the latest straw to break the real estate camels back all of you are grasping at?

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RaggedyRenter

Here’s what I learnt the past 6 years. Rents are always tied to income. Low income = low rent. There might be a couple of exceptions but as a system, low income locale = low rent. Owning in Vancouver might be too expensive but rent is reasonable. Current prices aren’t tied to income they generate. Once apartments become acceptable as a long term homeownership vehicle, their price aren’t always determined by their rent. Ditto house/land price. If you can destroy a couple of houses and build multiple dwellings, it will jack up the house price. Determining prices based on the income/rent they generate will become crapshoot IMO, for reasons below. Prices (these days) are more tied to liquidity. Liquidity comes from loose lending standard, historic low interest rates, hot money, QE, drug money, HELOC, what have you. We live in… Read more »

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jesse

” I wish Vancouver Price Drop would update its Drop from Peak chart”

Not sure if you’re being sarcastic, but we’re near all time nominal highs. Vancouver will be a “singularity” on the graph.

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squeako

“$269,800 one-bedroom, 519-square-foot unit”

A: LOL

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Vanuser

Nice to see Vancouver Price Drop back. I wish Vancouver Price Drop would update its Drop from Peak chart. This would be very interesting to see where we are at.

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Turkey

Bun Fight! Problems At The Printing Factory Lofts?

As a resident I will be contacting my litigator, as you are causing me financial harm with your “blog”.

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VMD

PIMCO: Canada’s Housing Market Correction Will Begin In 2014 January 29, 2014 Ed Devlin, head of fixed income giant PIMCO’s Canadian portfolio management, just released his 2014 economic outlook. “At PIMCO Canada, we have been bearish on housing for a while from a secular perspective, but this is the first time we are forecasting a cyclical decline in the housing market. ” To be clear, Devlin is not calling for a precipitous decline in Canadian home values this year. Rather, the firm thinks the market will start to “roll over,” with a correction that occurs over several years. Here is a summary of PIMCO’s case against the Canadian housing market: Valuations are stretched; Mortgage credit tightening is helping to cool activity; and The cost of capital for Canadian banks will increase this year, and these costs will be passed along… Read more »

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jesse

Ben Rabidoux is on twitter, you can follow him there.

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