House prices seem to be ‘in trouble’ in the good ol’ USA. If they only had the foresight to host the winter olympics maybe the US housing market could be saved eh? Today’s story in the financial post:
The United States could be heading for its first outright decline in national house prices on record, according to several analysts watching the rapid deterioration in housing statistics south of the border.
Further weakness in the housing sector could stunt construction activity and slam consumer spending, leading to slower growth in both the United States and Canada, analysts said.
“The slowdown in house price inflation has been extraordinarily rapid,” Gabrielle Stein, chief international economist at Lombard Street Research said in a report this week.
Those of us living in Vancouver should perhaps take a moment to be thankful for our rock-solid housing market, and the fact that due to beefed-up border security we are completely and utterly protected up here from whats happening in the US. It’s almost as if we are in a protective bubble!
No! Say it isn’t so!
I go out innocently looking for news of a bright and shiny future in the vancouver condo market and instead I am most rudely confronted with this:
The Greater Vancouver condominium market may be at an inflection point in the real estate cycle. One result could be an over-supply and/or over-priced product in many markets. There appears to be a very real risk of over supply beyond the forecast demand given the escalating market prices in some new condo submarkets in Greater Vancouver.
That bit of news from the PricewaterhouseCoopers (PwC) June 2006 issue of the Greater Vancouver Condominium Market Review release today. The news release is here.
Who are these PricewaterhouseCoopers anyways, and how can they SAY that?! It not supposed to happen here! Vancouver is different!
It looks like the lawsuit filed by George Dengin against his business partner Mark Chandler has not stopped construction of H+H at Homer and Helmken downtown or the construction of Garden City in Richmond. It is however stopping people from moving into the recently completed Tribeca condo development. There was a news story on bctv the other night about some of the fun and games going on in Vancouver’s condo market.
The seedier underside of Greater Vancouver’s housing boom is being exposed Monday night by a series of lawsuits and counter-suites between some of the city’s highest rollers. The main combatants, two developers both with checkered backgrounds, and now the battle has drawn in a man who’s become known as Vancouver’s Condo King (Bob Rennie).
Construction on H+H and the Garden City condo towers continue despite the lawsuit, leans and a stop-sale order from the superintendent of real-estate. Mark Chandler claims to have been paying workers out of his own pocket for the continued construction, up until last wednesday when his lenders started to fund chandler again. Both H&H and GardenCity towers are about 70% sold, but until this lawsuit is resolved buyers may suffer the same fate as buyers at another Chandler property- Tribeca. The condo’s and Tribeca are finished and ready for people to move in, but because of the current investigation it remains empty. This means that people who have purchased units in Tribeca and given notice at their current residence will need to find a place to live until this issue is resolved.
George Dengin’s lawsuit alleges unusual or apparent dishonest conduct including chandlers alleged failure to put money into trust and selling some units twice. Bob Rennie supports dengins lawsuit – he has provided an affidavit to support Dengins claims and has stopped marketing chandler properties.
Chandlers lawyers have filed a statement of defese and a counter claim naming Bob Rennie and George Dengin and their businesses, with Chandlers defense alleging that it “struck him at a particularly vulnerable time for the purposes of trying to take over ownership of the partnership”.
The counterclaim alleges that dengin and rennie have made false allegations of wrongdoing against the Chandler and that they filed their claim “on the basis of false, or exaggerated and unsubstantiated allegations.”
In the bctv newscast Mark Chandler was quoted as saying “I feel that he’s really trying to take the keys to my company.. I thought he was a friend. I thought he was a trusted friend”.
Rennie and Dengin did not reply to that news story directly, other than Bob Rennie making a statement that he is “a marketer not a developer” and that he has “no intention of moving into developement”.
This link was left in the comments yesterday by ‘anonymous’ (nice name by the way). The newest twist on house marketing in the U.S.A. is to go beyond ‘home staging’ and actually hire actors to play the part of a happy family ‘living’ in the house during a sales presentation. If you like reality tv, maybe you’ll like fake reality?
SANTA CLARITA – The scent of baking scones wafts through the house as children’s feet pound the floors.
“Dad” rushes to get things ready as “Mom” lounges on the couch.
It’s a birthday party for Camille Chen. “Husband” Jaason Simmons has breakfast in the oven and there’s about to be a surprise: He and the kids remodeled the den into a game room and won’t Mom, a notorious poker fiend, be pleased.
Except Chen and Simmons aren’t married, the kids aren’t theirs, they don’t really live in the house and they’re all Centex Homes marketing director Amanda Larson’s employees.
They’ve been hired to lounge around a model home, read magazines and occasionally pretend like they’re having breakfast.
Just how effective would this be? Do you think that the emotional connection is strong enough that people pretending to have a wonderful life in a house would increase the money paid for it? And how long till we see this technique put to work in Vancouver? Would you even spot it?
Concord Pacific is having a ‘moving sail and sales’ promotional event on July 29th with ‘bbq, live entertainment, free parking and prizes’. Hmm. I thought this was a super-hot market where you just hang up a shingle and prospective buyers stomp all over each other for a chance to bid on your property. Why are we having to lure people to a condo sales event? Kinda smacks of desperation.
Here’s what I say: BBQ is good, but I think I’d rather have it with friends, thanks.. My time is worth more than free parking and the chance to win a prize, so what else have you got? I’ll be happy to come and look at your condo sales pitch, but time is money. So at the very least you should match the common time-share sales pitch you get in Mexico, that is:
1) free car rental for a day
2) free tours of the ‘ruins of east hastings’
3) free food and
4) as much free booze as they can try to get into you before they try to get you to sign the paper work.
This is where I’ll start to consider coming to your sales pitch, anything less than that and I’m afraid its just not worth my time.