Vancouver Condo Info

What a difference a few months can make in the Vancouver real estate market. Inventory is high and prices are falling, no longer are we seeing the bidding wars of the past. In fact, it’s starting to look like reverse bidding wars as sellers compete for sharper pricing to snag the last of the boom-buyers.  We’re starting to see some big asking price discrepancies on similar units in the same building.

Girlbear pointed out this first example in Arbutus walk:

MLS V837889 vs MLS V839019 – both penthouse units.

847 sq feet asking $494,900 vs. 950 sq feet asking $439,000.

Anonymous pointed out this second example down near gastown:

MLS V831995 vs. MLS V831904 – both 5th floor townhouse units.

1,236 sq feet asking $548,000 vs. 1,202 sq feet asking $649,000.

Buyers who bought before the big run up in prices can afford to sell at a much lower price and still make money compared to those who bought more recently.  I guess this is what they mean when they say ‘buy low, sell high’.

We may be running out of land, but we sure aren’t running out of apartments for sale.  Just in case you haven’t noticed, VHB has been tracking downtown / False Creek North condo inventory in the forum and we’re seeing quite a number of places for sale there:

We posted this in the free for all, but it’s worth taking a closer look: Eleven pre-sales buyers at the Vancouver Olympic Village are unhappy with their units and are trying to get out of their contract. They complain about changes to plan and faulty fireplaces. Presales contracts of course always favor the developer, and these issues aren’t enough to break the agreement, so the approach their lawyer is taking is to claim that the City of Vancouver took over as developer. Since they aren’t listed on the paperwork this would be a technicality that could nullify the contract. If they manage to make this argument work and other buyers want a way out of their purchases it could be more trouble for the O.V.

The buyers put down deposits of between $60,000 and $300,000 for False Creek condos priced from a low of $550,000 to units that sold in the millions of dollars.

They’re being asked to close their deals by the end of the month.

On Thursday, Baynham filed writs in B.C. Supreme Court against developer Millennium Water on behalf of six of his clients, who have addresses in Vancouver and West Vancouver.

Baynham says the City of Vancouver is the owner of the property, after bailing out Millennium when it couldn’t get financing. But that’s not disclosed in the sales agreements, he says, so the contracts are invalid and should be rescinded.

The city argues that Millenium still owns the project and is the developer, the city is simply the bank.

We saw a lot of pre-sales buyers try to walk away from their contracts during the mini-crash a few years ago, and developers suing the for the difference between their deposit and the current market value. It’s interesting that these buyers are trying to get out of their contracts while the stats still show that Vancouver property prices are still at an all-time record high.

Yesterday we posted a link to an article about the high number of properties for sale in Vancouver. What’s possibly more interesting than the sheer number of listings in the very high number of price reductions we’re currently seeing. Yesterday Paulb shared numbers that showed 232 new listings and 56 sales, but nearly 3 times that number of price changes at 162.

We’ve seen many days where price changes have exceeded 200. Even with listings for the REBGV area nearing 19,000 Mclovin points out that we’re consistently seeing about 1% of total inventory drop their price every single day. That means about 5% of all listings in Vancouver are reducing their asking price each week.

The news is getting out there about the rising real estate inventory in Vancouver:

“We are close to that level where the seller either has to discount or lower the price or take the listing off the market,” said local realtor James Wong of Sutton West Coast.

The Vancouver-based Malaysian who sells properties in the neighboring city of Richmond told Xinhua that not all sellers were desperate to sell and could possibly delist their properties.

“They just want to catch a good price for what is perceived to be the value of their home. But most of them at this point have already missed the peak,” said Wong.

Full story in the english version of Peoples Daily Online.

River Green, The massive planned housing development advertised as Richmonds ‘very own coal harbor’ sold out this weekend, setting a new record for Richmond presales.

The biggest purchase was by a family who bought four suites valued at $5 million. Four penthouses also sold on the opening weekend at over $3.4 million. The 150 condo complex set Richmond sales records for individual condominium sale price and price per square foot.

Condo developer George Wong says this proves the once down and out real estate market is back. “It does set the tone for Lower Mainland real estate strengths. Certainly hope this is a shot in the arm for real estate in the province.”

The 28-acre luxury waterfront community is expected to take 15 years to build.

In fifteen years those buyers will either be thrilled they bought now before they were priced out forever, or potentially not so thrilled if the housing market fails to thrive. You’re going to have to wait 15 years to find the answer to that one.

Home sales in BC are down 11 percent in May 2010 compared to April, but prices are up and set to flatten according to the BC Real Estate Association.

The survey also concluded that, year-to-date, B.C. residential sales dollar volume increased 50 per cent to $17.5 billion, compared to the same period last year. Residential sales rose 31 per cent to 34,619 year-to-date, while the average price climbed 14 per cent to $505,468 over the same period.

The BCREA said in another recent survey that it expects sales to rise next year by about four per cent.

A separate survey by the Canadian Real Estate Association (CREA) recently forecast that prices would rise 2.3 per cent this year across the province before slipping back by 3.5 per cent in 2011.

Full article in the Vancouver Sun

May 29, 2010
by Crashcow

I woke up this morning with a massive hangover. Wow, what a 40% sales-to-list party that was! But with today being Alumni Weekend, I decided to check out my Alma Mater and tour the empire of new condos she’s been feverishly building.

Even though we’re now essentially in June, the day was cold, wet and wintery. But as any Vancouverite will tell you, this only a small sacrifice to live in the Best Place on Earth. A minor inconvenience, if you will.

As I entered into UBC and drove passed some new buildings, I became confused. My navigation sense turned dismal. If you haven’t visited UBC in over 5 years, chances are you will not recognize this place either. Entire communities the size of the Olympic Village have recently been built multiple times over. According to U-Town, there are now eight emerging communities, with Wesbrook Village being the largest. Talk about inventory glut.

The Sales office at Wesbrook Village sat empty. Balloons walloped in the wind. I saw no people and no amenities, except for a Save-on-Foods. The villages felt like ghost towns; it was quite the sobering contrast to Rennie’s sunny and euphoric circus at the Olympic Village. But then we ran into a friend that I hadn’t seen in ages. It turned out she was living in one of these new communities and had an interesting story.

She is a first-time buyer that entered the market a few months ago during the climax of the buying frenzy. After getting bruised several times in bidding wars, she toughened up to outbid the hounds. Victory was hers, as were the keys to a new UBC condo for over $600/sq.ft on leased land. The conversation was very insightful:

Me: “What shaped your decision to buy in UBC?”
Her: “I bought this condo as an investment. UBC is quickly becoming a world-class university and is increasing its student capacity. There is always going to be strong housing demand from students and families. My goal now is to build a portfolio with as many condos as possible. You should really take this opportunity to own here.”
Me: “Actually, I’m really enjoying renting at the moment. I did own a condo, but then sold it in fall of ‘07.”

This comment stirred a puzzled reaction in her.

Her: “Why? Do you think the market is going to…”

For some reason, she had trouble finding the next word. Any one of “drop”, “fall”, “correct”, “tank” or “crash” would have done just fine. Instead, she silently motioned a dive with her hand. This was clearly a fragile person.

It utterly amazes me that someone with higher education would consider leveraging themselves to the moon in order to snap up as many condos as possible without even seriously considering a drop in prices. It’s no surprise to us that politicians, real estate agents, brokers, bankers and developers have failed us. But it’s sad that our academic institutions have not equipped us with the most basic of financial street smarts.

I look forward to The Great Cleansing ahead.

-crashcow

This one is for all the data hounds out there. The VCI Condo Unit Listing Tracker (CULT) index is a snapshot of inventory available at a few select downtown Vancouver condo towers. The widget you see at the upper right hand corner of this page shows the overall number of units and percentage of total that are available in the index.

At time of posting on Monday evening there are 568 units available for sale in the 27 towers that comprise the index. This is 6.66% of the total number of units in those towers, down from 6.79% last week. You can click on the widget at any time to visit the detailed breakdown page at http://vancouvercondo.info/cult-index.

The 27 towers in the index are: Brava, Carina, Cascina, Conference Plaza, Elan, Erickson, Espana, Fairmont, Flagship, H+H, Hudson, Koret, Lions Towers, Melville, Pinnacle, Qube, Ritz, Sapphire, Shangri-la, Smart, Space, Spectrum, The Park, TV Towers, Vita, Woodwards Towers and Yaletown Park towers. The current leader in percentage of units available for sale is The Erickson with 14 of 61 units or 22.95% available for sale.

This index was built and generously donated to the VCI community by c0der, the same programmer who gave us the comment rating system used on this site. c0der is a Systems Architect who works with Linux, Security, Oracle Fusion and PHP/MySQL technology stacks. If you have a project you’d like him to consult or program for you can email him directly: coder@vancouvercondo.info.

Ok, this should hopefully be the last Olympic Village story for a while, but manx posted a link to more coverage of the uphill climb that the city faces to break even on construction costs and get paid for the land:

Inside city hall, officials are encouraged by the interest in the Olympic condos. But privately they express fears the city won’t recover the $170 million it is owed for the land on which the Olympic village stands.

Taking the land costs out of the equation, there may be the prospect for break-even, or a slight profit, on the construction price tag. But some serious challenges remain for this star-crossed real-estate deal.

The first is the HST, which will be applied to the new condos July 1.

Early buyers will no doubt be spurred on to make a deal before Canada Day, to escape the added HST costs. But the post-HST world could dampen buyer interest.

Vancouver city hall certainly thinks so. Officials have been lobbying the provincial government for an HST holiday, to help the city minimize the $1-billion project’s losses. The province has responded with a flat no.

The other challenge is the time frame of the Olympic sales plan.

It’s anticipated that sales of the remaining 474 condos will be stretched out over two years, to ensure there is no glut that might push down prices. The problem is the rising cost of credit.

Read the full article over at the Vancouver Sun.