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On the sleepy West Coast, despite the spin coming out of city hall, Vancouver remains a backwater when it comes to attracting or developing corporate headquarters.
Planners blame a lack of housing affordability, which discourages companies from setting up shop here. Civic politicians point fingers at our obsession with cyclical resources such as forestry and mining, rather than trying to grow the small, but emerging green economy.
At the end of the day, most homeowners are not fussed about a lack of a corporate presence here in Metro Vancouver. But they should be. Compared to Seattle, which generates significant tax revenue and jobs from industry titans such as Microsoft, Boeing and Starbucks, we are bit players.
Our jobs and growth plan is based upon condo development and land speculation. However, take that away, and our local economy is as emaciated as your average catwalk fashion model.
For far too long, we have associated new condo towers with rising property values. In other words, our region has convinced itself we don’t need jobs to increase our personal wealth — we merely need a hot property market.
It is painfully obvious we have lulled ourselves into believing we have a “real” economy. The sad reality is we are only one real estate crash away from finding out that we don’t.
The idea is that some properties held empty (speculating upon future price gains) start coming onto the market as rental properties if they cannot be sold for the ‘right price’. That way, when the crash comes, an entire extended families RE holdings go underwater, rather than one home being battered with a price drop.
Multigenerational wealth destruction.
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In 1995, Allan and Karin Hoegg were mortgage-free. But no more: today their Vancouver home is a valuable source of income as they plan for full retirement.
Sean Morphy and his wife got a very competitive mortgage rate when they made the jump to home ownership a little over a year ago but it took a long-term relationship with a mortgage professional to get them there.
Allan Hoegg says when their son and daughter-in-law wanted to buy a house, they took out a variable-rate mortgage so they could help them out. “We wanted to take advantage of the stability of the current rates.” To cover the mortgage payments, they rent out a suite in the home to students.
The couple also established a home line of credit that allows them to free up cash for investment purposes when they need it. “It gives you maximum flexibility and you can pay it any time you want without penalty,” he says. “It’s dead easy.”
Like many people planning their retirement, there’s a sentimental side to keeping their home, he says. But there are just as many practical reasons. In the Hoeggs’ case, selling to downsize would mean substantial commissions and moving costs. “Besides, real estate is a very good investment in Vancouver,” he says. “The longer we can stay here, the greater the possibility of no-tax capital gains.”
Obviously, the real trick these days is finding people with a modicum of integrity. People have a tendency to believe the printed word and to be more ready and willing to accept journalistic reports from a major news source as facts. Well, the newspapers and those who rely on them for their latest market intelligence deserve each other!
One would probably be better served to take a contrarian approach to most newspaper reports dealing with real estate investment. As has been said before, "buy on bad news and sell on good news".
At least when it comes to reporting, the "Blog" has shown that it can weather criticism and using the strength and depth of its readership, can unearth truth to a greater and more objective standard.
Good report Whisperer.... story needs to be told!
From the photo caption:Architect John Hollifield has taken 20 years to completely rebuild this family home, now listed for $2.68 million. The main floor boasts light open space, with flowing principal and natural light pouring in from the adjacent sunroom. Located in Vancouver's exclusive Point Grey neighbourhood, this home is close to some of the best schools that the city has to offer, as well as the almost limitless amenities of West 10th Avenue and the sandy beaches of Spanish Banks.
Architect John Hollifield has taken 20 years to completely rebuild this family home. The main floor boasts light open space, with flowing principal and natural light pouring in from the adjacent sunroom. Located in Vancouver's exclusive Point Grey neighbourhood, this home is close to some of the best schools that the city has to offer, as well as the almost limitless amenities of West 10th Avenue and the unique sandy beaches of Spanish Banks. For more information, visit Sotheby's International Realty Canada.
Pricey Pads was created as a way to showcase the greatest Estates and Mansions around the world. It continues it’s goal to compile updated lists of the world’s most expensive luxury Real Estate and Rentals in todays market. Keep checking back for frequent updates and new and exciting features! Be sure to “Become a Fan” of Pricey Pads Facebook Fan Page to see much more content.
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Rogers Communications is expanding into the real estate business.
The mobile and cable giant has applied to become a licensed real estate brokerage right across Canada and is aiming to relaunch its five-year-old website Zoocasa.com in May as a unique, one-stop-shopping site for homebuyers.
It’s aimed at going far beyond U.S.-based property listing services such as Zillow and Trulia which have revolutionized house hunting south of the border by providing critical data that can help potential buyers assess the value of a property from the comfort of their home computer.
While those sites link to licensed realtors who buy spots on the sites, Rogers intends to go a big step beyond that: Zoocasa will make sure its online directory of agents are vetted, knowledgeable realtors with a proven track record of making sales and providing superior customer service, said Zoocasa president Carolyn Beatty.
Beatty stressed the new site isn’t meant to cut realtors out of the home-buying equation but, instead, ensure that consumers now looking for houses online can go the next step digitally as well, finding a realtor they can check out through the site and feel they can trust to finish the deal.
A list of every price reduction in the Greater Vancouver market within the Real Estate board of Greater Vancouver (not Fraser Valley) within the last 7 days. I have included the addresses of every price reduction in excess of 5%. To be honest, the current number may only be an indicator of original delusion and may not "yet" reflect a "deal". The property could well have started off too high. I would have to look at each property specifically to see if it could be called a "deal". But the list is a starting point for interested shoppers. You can search the details of the addresses of interest by going to the "Properties" tab on our homepage and clicking on "address" search. I appologize if you are unable to determine what the selling areas are, but they are all encoded. If you are interested further, do not hesitate to call. Shockingly, the total list for the last 7 days for all price changes amounted to 244 properties of which 149 were in Richmond!
Home sales in Richmond for February, 2013 at 219 homes was a 33% improvement compared to the previous month. But, it was 32% lower than the sales registered a year ago in February, 2012. Home prices continued to drift down, and price discounting continued by motivated sellers trying to sell their properties. The supply of homes spiked up 12% compared to the previous month as more sellers put their homes on the market in anticipation of a better spring market.
The overall months-of-inventory (MOI) moved back up from 10.50 months to 12.27 due to the higher supply of homes. The housing market in Richmond leads the lower mainland in having the highest MOI. The Chinese New Year effect sellers were hoping never materialized. The busier viewing activities the past few weeks did not translate into a recovery in the housing market for Richmond.
Richmond real estate market outlook
The busy spring season is with us now. But, the large price gap between sellers’ asking prices and buyers willingness to buy, had resulted in lack luster sales. The standoff is expected to continue as most sellers are holding off making deep discounts to their prices. Homes that were sold were mainly those priced at or below their city assessment values.
The Chinese New Year effect proved to be a non-event for 2013. While viewing activities were reported to have increased significantly, actual sales were hard to come by.
More listings can be expected for Richmond in the coming weeks. The negative market sentiment and buyers holding off buying the next few months will continue to exert pressure on sellers. The current MOI at 12.27 months is expected to move higher to re-test last year’s height of 14.09 months in September, 2012. Richmond’s housing market will continue to suffer due to high inventory and below average sales. Further erosion in home prices in Richmond can be expected in the foreseeable future.
A housing market recovery in Richmond is best tracked by monitoring the MOI. Buyers should exercise caution when buying. The current housing market in Richmond is still trending down. Buying now should be mitigated at prices discounted deeply, and well below current prices.
Tough challenges for Richmond home sellers
The stand off between Sellers and Buyers will not be solved soon. The slow housing market in Richmond is expected to continue into next year. Motivated sellers who need to sell will bring homes prices down. The only way out for them to sell their homes is to lower their prices significantly to attract buyers. As home prices decline, buyers will stay on the side-line and wait for a suitable time to buy. Until the market stabalizes, the number of buyers willing to enter the market will be curtailed.
Vancouver’s real estate board is the home of the original Frankenumber, the MLSLink® Housing Price Index (HPI) composite benchmark price, blatantly intended to smooth out peaks and valleys, giving the impression of an eternally stable market.
The HPI is to houses what moving averages are to stocks. Instead of telling you what properties sell for now, it tells you what they averaged over time. Realtors love this since it filters out peaks and valleys, making markets seem serene and predictable. But the HPI is as useless to a serious buyer as a four-month-old stock quote is to a trader.
If kept in perspective Median Prices can be useful information to anyone considering the sale or purchase of a Vancouver property. As is normal practice I bring to my clients all statistical information possible when discussing the sale or purchase of their home. It is also my normal practice that if such graphical information is not readily available as a service from my board I will based on their data, build it. Such is the case with this Median graph. Additionally, in the past while commentators have expressed an interest in having a Median Price graph for Vancouver properties. It seemed appropriate to share this with them. I hope it will serve all well in your Vancouver home selling or purchase deliberation.
Does your real estate salesperson offer this service? If not, you might wish to consider giving me a call when life moves you.
Caution: In the graph below you will find a Median Price graph that includes Vancouver West, Vancouver East, West Vancouver and North Vancouver – the four communities within my service area. Remember that the Median Price is merely another statistical tool to help you make a Vancouver home buying or selling decision. It is a starting point.
History of Central Banks and why we must End the Federal Reserve
- Ralph Nader on CNN
The author(s) of the posts on this site are not investment advisors and they do not offer investment advice. They try to provide some hopefully useful data with sources - especially concerning real estate - and then add their own analysis.
All the content on this website is solely an expression of the author's personal interests and is posted as free-of-charge opinion and commentary. Nothing here is intended as investment advice. If you seek investment advice, consult a registered, qualified investment advisor.