All posts by VCI Admin

Call for inquiry on Vancouver home contract flipping

The Globe and Mail recently published a story on contract flipping in Vancouver:

The probe reveals that homes are being flipped by assigning – selling – sales contracts before closing, for higher prices than what the original seller homeowner receives in the end. Assigning contracts like this is legal, but controversial.

Speculators who profit this way also don’t pay property transfer taxes, because technically the property doesn’t change hands until the deal closes.

Mr. Eby said he is hearing from upset constituents in his Point Grey riding, where many homes are demolished to make way for new investor-owned houses that sit empty, some resold several times.

There have been a number of reactions to this story, but most recently calls for an inquiry:

The technique, which brings profits for speculators but higher prices for buyers, has sparked a torrent of criticism in the province “The investigation needs to be independent because the government has already said it doesn’t think there is a problem,” said MLA David Eby.

Vancouver Mayor Gregor Robertson said after Saturday’s report that the province should impose a tax on speculators.

Read the full article here.

BC Premier Christy Clark has already said no to the province making any extra money off of sales to offshore buyers, but says now there will be a study on the impact of foreign buyers.  The government also proposes to raise the PTT exemption as a way to solve high housing costs without risking lower house prices for first time buyers.

It’s worth highlighting this comment from ‘shut it down already‘ who points out that this summary confuses the issue of offshore buyers and contract flipping which has the ‘racists running in circles’:

Rampant speculation generally resolves itself in the end. The other obvious contradiction is that we often hear people here saying that government intervention in the markets is the problem, yet now you want them to step in and intervene.

Don’t forget that the original sellers of an assigned property accepted a price that they were satisfied with. It’s only greed and jealousy that had them aghast that the buyer might resell for more than they paid.

Friday Free-for-all – February 5th 2016

It’s that time of the week again…

Friday Free-for-all time!

This is our regular end of the week news round up and open topic discussion thread for the weekend, here are a few recent links to kick off the chat:

Economic ghost town
Last chance to buy
First chance to Rolex
The inevitable drop?
The infinite job machine

So what are you seeing out there? Been to any open houses lately? Thinking about buying or moving away? Post your news links, thoughts and anecdotes here and have an excellent weekend!

10 reasons the top is in for Vancouver real estate

Whistler or bust? posted this list of reasons they think the top is in for the Vancouver real estate market. What do you think? 

10 Reasons why am I calling a top now

1. Vancouver Real Estate has finally gone parabolic. It has gone from years of above average price increase to massive never before appreciation. No asset class that I am aware of has ever gone parabolic or hockey stick on a chart and not had a major crash. Not tulips, oil or tech stocks. This is textbook classic top – Greed has replaced Fear and it’s different this time for ______ and _______ has replaced rational thinking.

2. Panic buying and large price increase have spread to the distant suburbs such as Maple Ridge, Places where there is plenty of buildable land and lots of new inventory. Places are going multiple bids in average neighborhoods. People genuinely think if they do not buy now they will be priced out forever.

3. Real Estate prices in the vast majority of BC are flat to down. Its as if the Lower Mainland is an island onto itself. These are areas not affected by HAM or DAM so it better reflects the current economic fundamentals of the real estate.

4. The Canadian and BC economy is weak. There is risk that the spill over of falling oil prices will spread to Vancouver. This can be in the form of layoffs at West Jet or the CIBC because they have to cut costs due to losses on loans to oil companies. This is a bigger thing than many people think.  Continue reading 10 reasons the top is in for Vancouver real estate

The $6 Million tear-down

What would you call a 20 year old 7300 Sq foot house with brand new hardwood floors and an indoor pool?

In Vancouver we call that a tear down.

Property records show that the 7,300-square-foot house was last sold in 2013 for just over $6 million — the assessment today is $7.44 million. According to the 2013 listing for the property, it boasted $350,000 in recent renovations including new hardwood floors, a water purification system and windows. The listing sheet shows the two-storey house on a corner lot has 19 rooms including seven bedrooms, a media room, office and 12-foot by Seven-foot walk-in closet off the master suite.

…Well, we certainly know how to keep bulldozer operators and city dump workers employed!

Read the full article here.

By-election: What do politicians say about housing?

Patriotz pointed this out in the weekends open topic thread:

Tomorrow there will be provincial by-elections in Van Mount Pleasant and Coquitlam Burke Mtn. Both former MLA’s ran in the recent federal election – for the NDP (won) and Conservatives (lost) respectively.

What do the candidate websites have in common? None of them have anything to say about housing. For example in Coquitlam Burke Mtn which is the only real contest:

http://www.jodiewickens.bcndp.ca/issues
http://www.bcliberals.com/joanisaacs/

However I think this bizarre paragraph by Issacs on “Sharing Economy, Growing BC Tech” is notable:

I will advocate for a Sharing Economy to optimize new services for families – the Ubers, the AirBnBs, the Lyfts. A diverse economy means being open to new ideas and technologies. A Sharing Economy encourages the tech sector in BC, which helps create jobs and generates investment. It starts by giving British Columbians the freedom to participate as entrepreneurs or consumers or both!

So BC’s high tech future is operating your car as a taxi or your house as a hotel!