Archive for the ‘BC’ Category

Is Vancouver lost without a Compass?

Thursday, October 30th, 2014

In Vancouver everything is about real estate.

Yes, EVERYTHING.

Even that bus you take to get to your weed dispensary before yoga class.

Thats why it’s so disappointing that our world class fare gates are still not working.  This is the system that was supposed to be ready in 2008 but has been delayed over and over again. It’s a $194 million dollar solution that isn’t quite a solution yet.

Once in place this system should put a stop to fare evasion which is currently estimated to be a loss of at least $10 million per year. Well, hopefully it’s at least $10 mil per year, since we’ll be paying $12 million per year for operating costs once the system is working.

Fortunately this is all happening in Vancouver which means whether the transit system is losing money in fare evasion or through operating costs it can always make that money back in real estate.

What’s plan B for the economy?

Monday, October 27th, 2014

BC really hasn’t done so bad for itself by digging stuff up from the ground and selling it to other countries, but as prices change in that market it can leave our economy somewhat wanting.

For example:

This week, we discovered just how far the B.C. government was prepared to cave in order to assuage proponents like Petronas. It effectively cut the royalty tax it first talked about in half.

Now ‘free money’ is still free money, but anytime your income is cut in half its a bit of a downer.

So whats plan B to diversify the BC economy?  Gary Mason says there is no plan B and Patriotz says ‘what about real estate‘? But isn’t the RE market a bit played out at this point?

Most middle class RE purchases in Vancouver have gained less than a GIC over the last four years, and there’s the risk that high home prices chase away more productive industries.

So how does BC grow its economy in the future? If resources take a dive, what our best hope as a province to compete on a national and global scale?

Evangelists for buying

Monday, October 20th, 2014

Many Franks pointed out this article in the Globe and Mail and then pulled out a whole bunch of gems.

“Here’s a hilarious litany of Vancouver real estate orthodoxy straight from the punch bowl:”

…the city renowned in popular mythology as a place with such astronomical house prices that its young will be forced to live in basement suites forever…“

That’s right, buy or basement suites forever, your choice.

…There’s definitely sacrifices. I budgeted. I didn’t eat out. Some could say I missed some life experiences. But if you have that [home ownership] as your goal, anything is possible…”

It’s amazing whats possible if you just skip life experiences.

…the proliferation of condos and townhouses here gives them a lower-priced product to choose from compared with other cities that are dominated by houses…

Not only a magical city, but also one of the only ones around that has condos and townhouses!

…siblings or friends will buy an apartment together until they’ve built up enough equity to sell and take their proceeds…

Because what could go wrong with that?

…they’ve decided they’re going to buy in, no matter what…

NO MATTER WHAT!!

…buying became an emotional decision about moving to a new life phase. “This was the first step of being an adult,” said Mr. Richard…

Emotional decisions are an important first step of being an adult.

…some young homeowners have become slightly evangelical about the need for others to realize it’s possible if they stop being so clueless about money…

All it takes is a little knowledge.

“They don’t know anyone who owns, they don’t understand money, they just don’t think it’s possible. I keep telling them: “It’s a conspiracy to keep you as renters. Then you can pay someone else’s mortgage.’”

As Many Franks says “Amazing how much paydirt you can pack into a single article.”

 

Moving up in Vancouver Real Estate? Not so much…

Wednesday, October 15th, 2014

CIBC World Markets has released research that looks behind the average price moves in Canadian real estate. How are prices moving in Vancouver?

Astonishingly enough it looks like properties under the $1.1 million mark have moved less than a GIC in the last four years.  Here’s a graph from the original PDF:

Screen Shot 2014-10-15 at 2.50.16 PM

 

That boggles the mind. Even Toronto which has prices going up at the high end looks like its been a much better investment at the lower and middle end:

Screen Shot 2014-10-14 at 2.38.45 PM

 

So essentially that idea you have in your mind that Vancouver real estate has been a good investment over the last four years with prices just rising and rising? Not so much.

Prices up, incomes down

Monday, October 6th, 2014

Pete McMartin is on a roll over at the Vancouver Sun with a series of articles that looks at actual data on the Vancouver economy and housing.

The most recent article looks at local income levels.

Vancouver stands out as an unusual case around North America: Our house prices rose as our incomes fell.

But those high house prices, and our utter preoccupation with them, have become a distraction to a greater problem, and they are only a part of Vancouver’s economic malady. At any rate, those high housing prices are largely beyond the jurisdictional abilities of Metro Vancouver’s municipal governments to have any real effect on them. Meaningful change — in immigration numbers, for example — would reside with the federal and provincial governments, but not at the municipal level.

No, the persistent, year-over-year problem has been in income decline, and this has been a long time coming.

“This is not a new story,” said Tsur Somerville, director of the University of B.C. school of urban economics and real estate. “We have lagged behind the other major metropolitan cities since the 1980s, and even before the period of rising home prices.”

Read the full article here.

Historic accord splits control of properties

Thursday, October 2nd, 2014

They’re not making any more land, but we still seem to be finding some to build on.

The 21 hectare Jericho lands in Point Grey is part of an agreement to split control of three Vancouver properties between a crown corporation and three First Nations – the Musqueam, Squamish and Tsleil-Waututh Nation.

David Eby, MLA for Vancouver-Point Grey, said he was heartened to learn that a deal had been made regarding the Jericho Lands.

“There had been a lot of people in the community, myself included, that believed this land would be tied up in negotiations – potentially in court – for many years,” he said. “There’s a very clear and well-established traditional use of this land by First Nations. They were certainly entitled to it and it sounds like they received a fair share of their lands. It was certainly a surprise to hear that it has happened at all, let alone so quickly.”

Mr. Eby said the significance for the community he represents is that development will proceed faster than many anticipated.

“I would not be understating it to say that many members of the community that are neighbours to this property are incredibly concerned about the type of development that could potentially be located at this site,” he said.

“I can tell you everybody from affordable housing advocates to environmental groups … to the West Point Grey Homeowners’ Association has weighed in with different perspectives about what should happen here. That consultation will be challenging, but it’s critically important that it happen.”

Read the full article here.

 

Beautiful Empty Homes of Vancouver

Tuesday, September 23rd, 2014

A group of about 20 concerned west side residents have started posting a photo collection of vacant abandoned homes in Vancouver.

For some of these homes the term ‘beautiful’ is a bit of a stretch, but it’s interesting to see the growing resentment of abandoned and vacant properties in a town with high house prices.

There’s an article in the Province about that site as well:

The blog is “a documentation of what happens when Vancouver real estate enters the global real estate market,” but there may be factors other than absentee owners that contribute to the rubble-strewn yards and the decaying homes it showcases, Yan said.

As aging baby boomers begin downsizing to condos in other parts of the city “perhaps a good number” of their single-family homes are sitting empty between real estate deals, Yan said.

Still, this phenomenon could be the “edge of the new normal,” as Vancouver becomes a “resort city” where people from around the world invest their money in home ownership.

Regardless of why they are emptying, these neighbourhoods were centred around public schools and built for families, Yan said.

Read the full article here and visit the site here: Beautiful Empty Homes of Vancouver.

 

Politicians shouldn’t meddle with housing market

Wednesday, September 17th, 2014

This is probably the first housing editorial in The Province that most readers here can agree on.  Well, the headline any ways:

Politicians shouldn’t meddle with the housing market.

Imagine a world where the government didn’t meddle with the housing market.  There would be no CMHC insuring close to $600 Billion in mortgages, instead lenders would loan based only on their own assessment of risk.  There would be no HBP, no HOG. In 2006 there would not have been the rule change that allowed zero down 40 year mortgages with interest only payments for 10 years. After 2008 the CMHC wouldn’t have purchased $69 billion of mortgages off bank books.

But of course you’ve probably figured out that this Province editorial isn’t about that. No, this editorial is about someone suggesting we should levy a tax on vacant properties, likely the tiniest possible example you could find for ‘meddling’ in the housing market.

Wong is not alone in unfairly blaming foreign investors for Vancouver’s high housing prices. The reality is that real estate is a commodity whose price is set in a free market, appropriately, through the forces of supply and demand. No one has a “right” to own a house in a particular city or neighbourhood, and it’s about time that people like Wong and her COPE and NDP pals stopped promoting such notions, especially when it involves taking money from one group and giving it to another. You want a house? Work hard and buy one — or move somewhere cheaper.

Read the full editorial here.

 

Rent to own?

Thursday, September 11th, 2014

At least one local developer has struck on an ‘innovative’ way to rent out their property: rent to own.

Just like TV and Furniture in the 80s, you can rent to own a condo.

Under the plan, 15 per cent of a tenant’s monthly rent goes into a credit account. That money can then be used in the future for a down payment on a new Bosa home purchase, to a maximum of three per cent of the home’s value.

This should appeal to someone who is having difficulty finding a unit for 15% less and putting the money away themselves.

Buy in the suburbs, prices dropping like crazy.

Sunday, August 24th, 2014

Astute reader ‘reveal the truth‘ pointed out a few similarities between a recent Business in Vancouver article about people buying in the suburbs and an earlier article published in June:

Millenials Decamp to Suburbs”, published August 20, 2014, sure sounds a lot like “First Time Homebuyers Driving Surrey Market”, published June 24th.

Let’s see:
June 24th: Shayna Thow, director of sales for BLVD Marketing Group – which handles marketing for two Surrey developments for Vancouver’s Fairborne Homes Ltd. – said Surrey has become a viable option for first-time homebuyers who can’t afford to buy in Vancouver. While the average price for a single-family detached home in Greater Vancouver has soared to more than $1.36 million, the average price in the Fraser Valley is still under $655,000.

August 20th: Shayna Thow, director of sales for BLVD Marketing Group – which handles marketing for two Surrey developments for Vancouver’s Fairborne Homes Ltd. – said Surrey has also become a viable option for first-time homebuyers who can’t afford to buy in Vancouver. While the average price for a single-family detached home in Greater Vancouver has soared to more than $1.36 million, the average price in the Fraser Valley is still under $600,000, she noted.

Uh-oh. The only thing that stayed the same was the word for word structure. The PRICE however showed a DROP of nearly 10%! Yikes!!

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