Tag Archives: renovation

Renovation Time!

Sales have dropped off a steep cliff in Vancouver.

Last July came in more than 30 percent below the 10 year average.

But one thing is picking up: Renovations.

Instead of upgrading to a better home more people seem to be staying put and trying to make their home better.

The amount spent on renovations has gone up every year for the past several years, Simpson said, but added that he isn’t sure if that’s because more people are renovating or because they’ve become more expensive.

Canada Mortgage and Housing Corp’s third-quarter Housing Market Outlook, released in August, said renovation spending in 2011 was $61.7 billion in Canada. CMHC says that amount will moderate in 2012, growing to $63.3 billion, but is expected to strengthen in 2013 to $65.6 billion.

In B.C., spending on renovations in 2011 was $7.6 billion. Spending is expected to remain stable in 2012 and grow to $7.8 billion next year.

For the most part, business is good for contractors, even in this year’s moderate market, Simpson said.

“One contractor I talked to said he’s having his best year ever,” Simpson said. “He said one client bought a home and they’re spending money to update it, but most clients want to stay where they are and bring their homes up to date.”

I guess the advantage of living in a construction zone is that you can do it a little bit at a time when you can afford it, like buying a little bit of a house at a time instead of all at once.  Sounds like some people are also finding it harder to get financing for their dream homes:

Another contractor told Simpson he’s had some customers having a harder time borrowing money from the bank, which may be a result of new mortgage refinancing rules. “Some people seem to be getting a little pushback from the banks, or they might not be able to borrow as much as they want,” Simpson said. “If they can’t obtain the financing, they just have to scale it back a bit. With a renovation, you don’t have to do it all at the same time.”

Read the full article over at the Vancouver Sun.

The pros and cons of a fixer-upper

Looking for a bargain?

Why not buy a disgusting heap of a house that no one else wants and turn it into your dream home?

The Financial Post has an article about the pros and cons of buying a fixer-upper.

It’s a first-time homebuyer’s dream: Snag a rundown house in a terrific neighborhood, and then revamp it to your heart’s content.

But fair warning, that fixer-upper could become your worst nightmare.

“You have to really know what you’re getting into,” says Zillow.com real estate expert Brendon DeSimone. “It could be the case where it seems like a good price and then you dig deeper and find that the windows are off, the electrical foundation is messy, and so on.”

Translation: You could wind up spending more than you bargained for.

Read the full article here.

Friday Free-for-all!

It’s that time of the week again!  Friday is when we do our regular end of the week news roundup and open topic discussion thread for the weekend.  Here are a few links to kick off the chat:

Vancouver market in full retreat
Championship of lost sales
REBGV news release for July 2012
GVREB news release for July 2012
How much $ has left the economy?
New site forces realtors to compete
‘Think Housing’ contest winners
Renovation Boom
BCSC alleges million $ fraud
No new steps to cool market
New framework for credit unions
Global slowdown dashes hopes
Unsold Toronto condos growing

And here’s a couple of charts, the first one is from VMD and shows what the average Vancouver house price has done in the last two years:

This second chart is from Ben Rabidoux and was linked by Jesse – you can draw on your own red line for July:

So what are you seeing out there?  Post your news links, thoughts and anecdotes here and have an excellent weekend!


Brand new house $130k

What’s this, builders making a profit on new houses at $130k?

Apparently only in Vegas.

Yes, after a 60% drop in house prices builders are somehow still in business making new homes and selling them for under $200k.

“The single largest impact has been houses under $200,000,” Beville said. “Homes in the $130,000 to $190,000 (range) are getting a lot of love. The ones in the $200,000 to $300,000 are getting a little bit less.

Meanwhile in Vancouver even if you get the land for free it’ll cost you $270k to build a 500 sq foot laneway home.

Construction cost is high in Vancouver for a few reasons: permits, cost of materials, cost of labour.. but there’s really only one reason construction cost is so high: people are willing to pay for it.

It’s not like construction quality here is known for it’s quality (leaky condo crisis) and we even make use of unpaid illegal immigrant labour and still we pay these prices?