“If they got in early, they got burnt” says the selling agent about the Olympic Village condo development.
The Globe and Mail features this deal where a unit was purchased new for $1,565-million + HST in 2010 and recently sold for somewhat less.
He says prices dropped in 2013, when the city took over sales. At that time, he sold a 1,200-square-foot unit, with a water view, in the same building for $860,000. “That’s more like a Burnaby price,” Mr. Yan says.
Last December, he advised a client to purchase this unit, and she jumped on it. She’d been looking for three months in Richmond and Yaletown as well.
“I said to her, ‘If you had talked to me a year earlier, I would have got you an even better deal [in the building],’” Mr. Yan says.
Read the full article here.
Skook has a post over at VancouverPeak.com about an island dream gone sour.
A BC couple purchased land on Mayne island and started building their dream home only to run into a confluence of cost overruns and real estate market downturn.
Today, their house is only a wood frame shell that looks out over one of B.C.’s most dramatic views, with the Lower Mainland in the distance, and regular sightings of ferries, whales and seals. The tiered wooded lot is only a five-minute drive to the ferry.
It is the idyllic best that B.C. has to offer, and yet the Klingsats won’t even break even on the near $1-million they spent on the property and construction. They have relisted it for $539,000, after previous listings at $649,000 and $699,000 didn’t get any offers. “Everybody loves the place, but the people don’t want a house that’s not finished,” says Mr. Klingsat, who gave up on the project six months ago. “And I can’t do it. I haven’t got any more money to put into it. “The whole economy everywhere is lousy – nothing is gangbusters. There are places for rent all over here on Vancouver island.”
The original article in over at the Globe and Mail. Skook adds some extra thoughts and information.
RFM has also added some information summarizing other properties in that particular island market. There are 113 properties for sale on an island with a population of 900.
Are we careening towards a sharp correction in house prices across the country, or are we just comfortably ensconced in the new value of property?
A Goldman Sachs report is the latest voice of warning about overbuilding and overpriced houses in this country.
Adding its voice to a growing chorus of concern, a report from Hui Shan, an economist at Goldman, late last week warned: “what goes up can keep going up, but then tends to come down.”
Ranking high-growth property markets in the last four years, Canada comes fourth behind Israel, Norway and Switzerland, according to her research. But unlike some other markets, construction activity has been trending up for years and has not shown signs of slowing down in Canada, she explained.
“If the elevated level of homebuilding persists in coming years, the risk of overbuilding will increase substantially. And if the ongoing housing boom is followed by a housing bust, the price decline can be quite significant given the excess supply of housing at that point,” she said.
On the bright side for some, they are predicting that prices could still see some upside before correcting. Read the full article over at CNBC.
The City of Vancouver still owes lots of money for the
Olympic Village condo development.
They aren’t saying how much but it looks like it’s currently at least a couple hundred million.
Is it time to cut our losses?
Developer Michael Geller thinks so. In this Province article he says it’s time to cut the prices and get out while we can.
As Vancouver’s real estate market cools, losses on the troubled Olympic Village development could soar above $225-million unless condo king Bob Rennie quickly drops prices on unsold units that have languished on the market for too long.
That’s the view of developer and architect Michael Geller, a former NPA council candidate, who suggests flawed pricing and weak marketing is turning the fiasco on False Creek from bad to worse.
Read the full article here.
What do you think? Does the city stand to lose more by holding out for ‘maximum price’ or by selling quickly at a discount?
The problem with using averages is they can look terrific on the way up and horrible on the way down. Remember all that talk about the ‘average’ Vancouver house now being worth $1 million? One year later it’s apparently worth $735,315. What will it be worth next year?
The average home price in Canada in April was up 0.9 per cent from a year ago at $375,810.
“It bears repeating that the national average price was skewed higher last spring by record level high-end home sales in Vancouver’s priciest neighbourhoods, and that a replay of this phenomenon was not expected this year,” said Gregory Klump, CREA’s chief economist.
Sales in Canada’s largest markets are having opposite effects on the national average, with slowing sales in Vancouver dragging, and soaring sales and prices in Toronto exerting upward pressure.
The average selling price in Vancouver was down 9.8 per cent compared with a year ago at $735,315, while the average price in Toronto was up 8.4 per cent at $517,556.
Read the full article is in the Vancouver Sun.