Vancouver Condo Info

The courier is getting lots of linkage from us as of late, but they’re playing both sides of this issue pretty well.  Is it racist to say that we should have foreign buyer restrictions or that absentee owners can kill a neighborhood?  Mark Hasiuk says NO.

Christy “Families First” Clark, a committed globalist, won’t restrict foreign ownership in B.C. Mayor Gregor Robertson, who slobbered over Beijing during a 2010 “trade mission” to China, won’t reform the tax code to accommodate the new normal. Which means foreign real estate investors pay the same rate (4.2 per cent) as local homeowners, not the business rate (18 per cent) they should.

Read the full article here.

This post was submitted by Farce.

Here’s a beauty that all of us missed this spring while we were hanging out on the bubble blogs:

1950 East 1st Avenue, listed $688K, sale price unknown. Mere steps to popular East 1st Avenue.

(more…)

This post was submitted by Many Franks.

I think this comment from zrh2yvr is worth highlighting, so I’m pasting it into the submission page!

OK – Some more interesting data – Again just the facts.

Van-West Detached, a market which seems to be suffering, can be described as three markets. One where there are over 350 units for sale in excess of 3.2 million with MOI of over 18 months, 185 units for sale at 1.9M or less with a MOI of 3.8 months and approx 340 units for sale between 1.9M and 3.2M with MOI at 6.7 months.

For units priced at under 1.9M, there is a severe lack of inventory which could be a reason for lower sales volumes. One has to wonder however, what will become of this high-end with properties for sale over $3.2 million? They are selling only at a slow pace but at 18 months, I would say many sellers would be happy to just wait for thay buyer.

Meanwhile, inventory is creeping up. Just like Richmond however, it is creeping up only in the low-mid range of the properties. The number of properties for sale with an age of up to 10 years has not changed since January (approx 230 units). However, in the range of 10-115 years old, overall, inventory is up by 80 units or 17%. In the tear-down category (those with age of 999), there are 9 more units or 11% so this could also be seen to have increased.

What is this saying? I would say that until the top starts to fall, there is not much down side in the Van-West market. Not much upside either as on the higher-prices, there are many many choices.

When looking at MOI, Given that sales of the higher-end properties have been picking up, we are seeing MOI for the new inventory decrease where now there is only 13 months for homes up to 5 years compared to approx 17 months in January. This is not a great level and is truly one to put downward pressure on prices. One has to wonder how many of these properties are held by speculators or builders who need to sell.

Finally, what areas are we seeing with deterioration in MOI?

Oak – Now at 10 compared to 5
Kerrisdale – Now at 10 compared to 7
South Granville – Now at 14 compared to 12
Cambie – Now at 9 compared to 6
McKenzie Heights – 8 compared to 6

Shaugnessy has highest MOI still but has improved to 16 from 18.

The most important ares with low inventory and tight MOI are:
Kits – 3.7 months now compared with 3.4 previous
Dunbar – 4.4 months now compared with 6.2 previous
Point Grey – 5 months of inventory same as previous

–
So overall, we are seeing the market change. The foreign buyer and the top-end buyer are not in the marketplace in sufficient numbers to acquire the high-priced inventory that is for sale. Limited numbers of units for sale under 1.9M are creating tight supply, but also low sales volume. However, ALL inventory increases have occurred in the lower priced ranges and are not evenly distributed throughout the entire market. It is not clear what we will see next. Perhaps it will be recent low-priced land plays coming back on the market as they realize there is too much competition on the new-build market. Perhaps we will see some high-end builders having to reduce to clear their inventory.

Either way – it is going to play out slowly until there is a change in the credit markets that changes the access to credit for all buyers.

This post was submitted by testing.

Nice response from Sandy Garossino to last weeks Allen Garr column “Blaming Chinese For High House Prices in Vancouver Is Racist”.

When I raised concerns over the impact of international transactions during the civic election campaign, the response was overwhelming and full-spectrum from across our entire community, because the problem is universal.

It was notable how concerned Canadian Chinese Vancouverites are about this difficult issue, and how optimistic and imaginative some of their solutions are. Many in this community, such as Susie Joe Dooner, expressed grave concern about the exodus of gifted young people they have seen—their own friends and family leaving their home city and province in despair of having a future here.

And it was this community which also expressed concern that our local real estate and development industry bears some responsibility for its aggressive marketing to foreign investors. Some cautioned that the scale of the potential market poses real hazards to a small city like Vancouver.

It is profoundly inaccurate to represent the public reservation about unregulated international capital in our housing market as having a racial bias, when the concern is universal.

Read the full letter over at the Courier.

I wonder why we don’t have a foreign owner property tax structure like Florida and other places that charge a premium to non-resident owners (regardless of what their race or country of residence is).  It would raise more money to pay for city expenses, take some of the tax burden off residents and best of all the only people who would complain about it can’t vote!

This post was submitted by Jackson.

The Vancouver Sun has some good tips for people who are completely unable to save up for the largest purchase of their life.  People who either spend too much on entertainment and shopping or simply don’t earn enough to save.  Buy a house.

Yes. Because the people that should be buying real estate are people who are unable to save up a few thousand dollars.

Their advice ranges from the ridiculous (reign in spending habits) to the sublime (ask mommy and daddy for a down payment).

Saving money for a down payment, especially in British Columbia’s high-priced housing markets, is one of the biggest challenges that homeowners face, but mortgage experts say, it’s not impossible.

The minimum down payment new homeowners need is five per cent of a home’s purchase price, which can be particularly difficult to accumulate for those in the most need: young people, often with student debt and lifestyles that involve a lot of restaurant meals and going to movies once or twice a week.

Yeah, that’s 5 percent goal is super-tough, but it just might be achievable according to ‘mortgage experts’.  You can always tap into your RRSPs, and don’t forget that you can get yourself a zero-down loan (we call them ‘cash-back’ mortgages).

…some lenders have a cashback option that can be used against a down payment. “The clients have to take posted rates [not discounted] and some lenders will give you five per cent of the mortgage amount as cash back. On $400,000 that would be $20,000, the five-per-cent down payment that is required.”

This post was submitted by Thereyugo.

The telephone company is building a condo tower and they’ve sold out their pre-sales units.

“It’s all geographic who’s doing well.”

Recent figures from the Real Estate Board of Greater Vancouver compiled by various real-estate analysts indicate higher numbers for unsold inventory than past years at the same time.

Local sellers all say that it’s not foreign investors driving the market for the successful projects, but local investors and people planning to live in the condos themselves.

Ms. Goertz said Telus offered its employees priority in sales at Telus Gardens and 150 of them bought, even though the price discount was a modest one per cent.

BLISTINGAGENT had an interesting point in the previous thread: A couple of years ago when the market took a dive a lot of presales buyers tried to walk away from their contracts and developers sued them for the difference between their deposit and the current value of the condos. What happens if the market takes another dive and Telus employees try to walk away from their presales? Dock their pay?

This post was submitted by The Ant.

The Pique has an article about some remarkable goings-ons just a little ways north.  Some hotel condo units in Whistler are now selling for half their peak price.

Those who own a condo unit in a Whistler hotel are sitting on great potential, but at the moment the units are not showing great value.

Real estate consultant Denise Brown with Re/Max Sea to Sky Real Estate reported that a unit originally sold in the Four Seasons Whistler for about $1.1 million was recently resold for only $520,000.

The so-called Phase 2 units in Whistler have fallen victim to the globally depressed financial situation, said Brown.

“We’ve seen the prices come down significantly,” she said.

According to Brown, this segment of the real estate business is at the bottom of the cycle so prices are good right now. She said the people who are happiest in the condo hotel market are those who are in for the long-term and have made a lifestyle choice in purchasing a condo unit in a hotel.

Lifestyle.  Got it?  Lifestyle, Lifestyle, Lifestyle.  Just repeat the mantra and you’ll be fine.

Then there’s this gem:

Kelly said this segment of the real estate industry has improved in the last six months but people aren’t willing to spend as much in Whistler as they were a decade ago.

“It’s not anything wrong with Whistler or that Whistler is worth less,” said Kelly. “It is just that people are prepared to spend less.”

It’s not that Whistler is worth less than it has ever been worth, it’s that some people paid more than it was worth.

If you’re sharp-eyed you may have noticed some ‘special offers’ on 5 year fixed rates.  BMO kicked off another low-rate war by once again offering a rock-bottom 5 year fixed rate of 2.99% and a new 10 year fixed at 3.99%.

Nobody wants to be left out of fun like that, so TD, CIBC and Scotiabank quickly followed suit and started offering a 2.99% rate as well.

How are customers responding?

Techar said reaction to BMO’s previous offer was fantastic. “We saw an increase in volume almost immediately and it continued for the whole two-week period.”

These deals are temporary and expire in a few weeks.  You’d almost think something was about to happen March 29th, but who knows?  Rumour has it more changes are coming to insured mortgage rules in Canada whether it’s higher down payment requirements or shorter amortization terms.

So is this a deal too good to refuse, or a trap for the gullible?

If rates start to rise, could it be a benefit to buy a home now?  Would these ridiculously low rates offset a drop in prices at a higher interest rate?

What about in markets whose prices have fallen for the last few years?  There are many of these across BC – The Okanagan has seen prices collapse by more than 30% so already.

And what does Mark Carney have to say about all of this?

“Canadian household spending is expected to remain high relative to GDP as households add to their debt burden, which remains the biggest domestic risk,” Carney said Thursday as he held the bank’s trend-setting rate to 1 per cent.

The CBC has an article looking at the situation for middle-class home shoppers in Vancouver BC.  They’ve noticed that incomes have dropped since the 70s while prices have risen.

So if you’re middle class in Vancouver you’re either priced out forever or something is going to change.

From that article:

Lawyer Nathan Hume and health researcher Angie Chan live with their two young children in a rented two-bedroom apartment in Vancouver.

With two good jobs, they had hoped home ownership in the city would be within their reach. But sky-high prices in Vancouver have left them without any options.

“We have a number of friends who are in the same situation as us — highly educated, they’ve got good jobs, they have young kids, and they’ve all left the city,” said Chan.

Hume says it is likely they could get a mortgage to buy something, but they don’t think that’s smart, when it would mean foregoing savings for retirement and their childrens’ education.

Remember just after the US bubble peaked? There were foreclosure bus tours in places like Vegas and Miami.

Did you ever think you’d see something like that in British Columbia?

Apparently it’s happening on Vancouver island right now.

This video clip from CHEK news shows people shopping for a good deal to flip or rent out now that there are so many owners going into foreclosure who were unable to flip or rent out their property.

Might be a tad early on that one.