With all the media focus on rising real estate prices in Vancouver you’d think all market segments must be doing pretty well right?
Well it sure looks like condo prices have been languishing. First we had the CIBC world markets report showing Vancouver condo prices barely budging in the last five years, and now Ulsterman points out the following:
It’s easy to only see the big gains SFH’s have made over the past 5 years and overlook the many “homeowners” of condos who have not made much or even lost money (what!?!, but i was told it only goes…).
I noticed 303-1333 W 7th Ave (V1088944) listed in the Georgia Straight p72 of Nov 20-27 issue). It’s a 1bd/1bath unit listed for $355,000. The key detail was of course, “Amazing deal, listed $20,000 below where it sold in 2009.”
So after paying $70k in interest, $15k’ish in taxes and strata fees, $20k capital loss, CMHC fee when buying (10k) (3%?), $13k selling fees. This gets expensive really fast ($128,000 over 5 years or $2133/month). It probably rents for $1300/month.
Not such a slam dunk.
Are condos just hitting a price ceiling at the entry level? Shouldn’t condo prices be going up more in this market?
Joe Mainlander points out that the REBGV HPI paints a similar picture.
Even the REBGV HPI stats point to a sinking condo market (not 20% though);
Metro Van Apartment HPI;
July 2008 = $367k
July 2014 = $380k
There’s been 10% inflation since then, so HPI would need to be $403k just to keep up.
A 6% drop in real dollars.