Vancouver's Real Estate Market

[punkwax]

I've avoided posting in this thread so far, and admittedly haven't read every page but feel like I should share my experience with real estate since I bought my first home 9 years ago. Seems like there are more people saying don't invest (at least in recent pages) so I thought I would share my story:

I know people who for years have vehemently said, rent, don't purchase. Avoid debt. Even people who have sold their home and cashed out their equity to rent. Today, they admit they have been wrong so far. They may not be wrong forever. Those I know who invested wisely still don't believe their returns would have equalled Vancouver's real estate market. I will note that I don't hang out with wall street investors. This won't be the same for everyone, I am sure.

I've been in a lot of debt myself and have moved 4 times over the 9 years in order to build equity. Moving sucks and there have been nights in the past that I've worried, if the "bubble" does burst, I may lose a considerable amount of equity. If interest rates jump, I may not be able to afford my mortgage. I have kids. This isn't for everyone! Edit: I should say, taking a lot of risk (debt) for the chance of higher gains is not for everyone..

Fortunately, I've never felt like my land value could dip below my amount of debt. My first home was all about location. I was <100 steps away from the ocean in crescent beach. Bought low, sold high 3 years later. Took that equity and made the mistake of being temporarily blinded by the brand new place on the small lot with the hardwood, granite, 2/5/10 warranty. I quickly realized I made a poor investment and GTFO losing around 60k doing so. My 3rd home was older with a nice chunk of subdividable land in a great area. Again, location. This time I took on a lot of debt to secure a big lot. Took the risk and was rewarded with a nice profit when I sold it in June.

Because of these moves, I now live pretty comfortably in an older, albeit very nice home in a very nice neighbourhood. Did I say location yet? I have a very manageable mortgage and no real concern about what interest rates or the market does. I feel very fortunate to be able to say pretty confidently, unless something REALLY crazy happens I will be ok. My latest home is in an older 80's built neighbourhood on a 13000sqft lot. As homes are torn down and massive replacements built, my land value should increase. I've been here only 6 months, pay close attention to the local market and figure I could already sell for ~80k more than I paid based on what lesser homes on lesser lots are currently on the market for Tempting, but I'm tired of moving, have a 3rd child on the way and plan to live here for a long time. When my kids move out, I'm sure a builder will snap up the land if I want to take the easy way out.. maybe by then I'll want to do it myself to try and maximize profits. Who knows.

I mentioned my kids. I want to have something to leave them when I kick the proverbial bucket. Historically, land value has, and I believe has no other option but to continually rise in value as population increases and, in case you've been living in a cave, Vancouver has put itself on the map globally as a very desirable place to live. There might be the odd dip, but history dictates that my lot will be worth more in 10/20/30/40+ years than it is today.

Unless there are catastrophic events, I'm on the way to leaving a nice little nest egg for those who matter most

Anyway, this is my story thus far. I'm not advising people on how to make their financial decisions, you do you. I just wanted to share with those considering real estate, in my experience, its a good way to go and I recommend getting in sooner than later.

[Special K]

I understand new buildings = GST, depreciates faster, and have to compete with brand new homes 5-10 years down the road if you sell.

Say you have no plans to flip real estate, what are other downside considerations?

[quasi]

Originally Posted by Special K

I understand new buildings = GST, depreciates faster, and have to compete with brand new homes 5-10 years down the road if you sell.

Say you have no plans to flip real estate, what are other downside considerations?

I live in one of those new narrow type houses your talking about. I will say I regret buying it only because it's to large for my small family. I have a 5 bedroom house and only 3 of us live in it making use of 2 bedrooms. I have no desire to suite the basement I don't want to deal with renters so that space goes largely unused. Thinking back I would have been better off to buy a smaller older house on a larger lot and used the savings to renovate. I've considered selling and moving but once you take into account real estate fees, moving costs, closing costs and Property Transfer Tax I'm going to lose 25-30K of equity which is to much to downsize IMO.

Pro:
- New House no issues maintenance wise.
- New neighborhood, new schools for my kid.
- If you have kids, lots of young families who also have kids.
- Lots of new parks, I have 2 huge ones within a 5 minute walk in different directions and a 3rd one with Tennis Courts, Soccer Fields and a water park is under construction.
- Now I have really good neighbours, a single mom teacher on one side and a cop on the other side both very friendly.

Cons:
- Cookie Cutter finishes.
- Lots of suites in the area either coach houses or basement suites which creates parking issues and can bring in undesirables into the neighbourhood.
- Yard is very small, my son plays mostly on the sidewalk/grass area in front of the houses or we go up to the park.
- I used to have terrible neighbours on one side that rented out there house to a group of young 20 somethings who all worked at a bar. When they'd come home after shift the party started, 3:00 in the morning on a Tuesday music blaring and the party in full swing. Houses so close you hear everything.

[Gululu]

my house westside (1993 40 x 122.09Ft 2924sqft):
Total Assessed: $2,197,000 Previous Assessed: $2,056,000
(land $1,783,000, building $414,000)

my apartment westside (2005 1065sqft concrete):
Total Assessed: $1,046,000 Previous Assessed: $1,013,000

and some in richmond and burnaby I havent checked yet

[punkwax]

Originally Posted by Special K

I understand new buildings = GST, depreciates faster, and have to compete with brand new homes 5-10 years down the road if you sell.

Say you have no plans to flip real estate, what are other downside considerations?

For me, it's all about the land and location. I wouldn't worry about competing with newer homes. Those who understand real estate know its all about location and owning the biggest/best piece you can afford in said location. If it has future potential ie. subdivision, view etc. even better.

My advice is buy an older home on a bigger lot in an established neighbourhood vs. a new home on a small lot in a new subdivision. This is a blanket statement of course but should ring true in many neighbourhoods around the GVA.

[Traum]

Originally Posted by suzuka84

The shocking thing with Xi's corruption crack down is there's no slow down in areas outside of Asia. The chinese don't dare invest in HK and Macau as the China government can easily get their hands on it. Outside of Asia, Canada & USA is fair game. They're washing dirty money and ill gotten gains. Canada and USA won't send the dirty officials back to China so once the money is out, it's gone. It's a different story in HK and Macau where once the money is out, the HK and Macau govt will do nothing to stop the China govt from knocking on your door repatriating you.

I'm watching China constantly to see what they do with John Jia as his ties go right to the top - Canada Resident Caught Up in China Corruption Probe - WSJ

I would disagree about Mainland Chinese not daring to invest in HK and Macau. Especially with Hong Kong, because of its (still relatively) independent legal system and close proximity with China (both in terms of physical location and human networks), a lot of lower profile and 2nd or 3rd tier nouveau riche / political officers are funnelling their money to HK. Sometimes, they view Hong Kong as the semi-permanent destination to safeguard their funds. Other times, they consider a temporary stopping place while they find other means to channel the funds to foreign countries (outside of HK and China).

Real estates, for example, has already locked up tons of investment money from the Mainland Chinese folks. In selected areas, especially those billed to be luxury homes, you don't hear Cantonese as the primary language because the buyers are all Mainlanders. At other times, a lot of units are left empty because they were only purchased as investment or vacation homes.

The situation is similar (but perhaps worse) in Macau. Since reunification with China, I remember watching a TV documentary saying how housing prices has skyrocketed by some totally ridiculous amount (by something like 50x?).

[Gumby]

Originally Posted by Special K

We finally went out to see a house with a realtor. What would you pick? 1/2 duplex in Vancouver (West/East) or narrow lot house in Delta/Surrey/New West?

Assume similar price, brand new building, and no rental suite.

First hand experience would be helpful.

I believe property values would increase faster in Vancouver compared to the other areas. Also, if you have kids or plan on having kids, what about schools in the area?

Spoiler!

I lived in a 1/2 duplex in Marpole from 2004-2012. Neighbour was nice, fortunately. Believe it or not - bought for $375k and sold for $830k. But don't expect the same kind of property value increase!

[Gumby]

Originally Posted by punkwax

For me, it's all about the land and location. I wouldn't worry about competing with newer homes. Those who understand real estate know its all about location and owning the biggest/best piece you can afford in said location. If it has future potential ie. subdivision, view etc. even better.

I agree about the land and location - but it depends on one's situation as well.

If you don't mind moving, then buying land on a major corridor with the hopes that a developer will pay big bucks for your land could be attractive. But I wouldn't want to be one street in, and have a potentially tall building looking into my backyard!

I hate moving, so I'd pick a good location (convenient to work/school etc is important to me) and one with no risk of being further developed.

[Special K]

Originally Posted by Gumby

I believe property values would increase faster in Vancouver compared to the other areas. Also, if you have kids or plan on having kids, what about schools in the area?

Spoiler!

I lived in a 1/2 duplex in Marpole from 2004-2012. Neighbour was nice, fortunately. Believe it or not - bought for $375k and sold for $830k. But don't expect the same kind of property value increase!

Thanks for sharing.

We just looked at a $900k 1/2 duplex in Marpole vs. $800k detached house on half narrow lot house in Ladner.

With the Massey tunnel being replaced and big shopping mall (I might be wrong) coming up soon, Ladner isn't so bad?

[blkgsr]

other than MLS what's a good way to find out approx house values for an area.....how can i find recent sale prices?

[Mr.HappySilp]

Originally Posted by blkgsr

other than MLS what's a good way to find out approx house values for an area.....how can i find recent sale prices?

Property tax assessment?

[sonick]

^ +1, BCAssessment.ca

[tastic]

Originally Posted by Special K

Thanks for sharing.



We just looked at a $900k 1/2 duplex in Marpole vs. $800k detached house on half narrow lot house in Ladner.



With the Massey tunnel being replaced and big shopping mall (I might be wrong) coming up soon, Ladner isn't so bad?

We were looking at similar stuff and just bought our place in Ladner a couple months ago. Loving the area so far...we wanted a detached with yard and 2 car garage so with a budget of 0.8-1M, it was the right place for us. I work in the UBC area too and I either leave before or after the worst tunnel traffic and I got to UBC in 36 min this morning.

[SumAznGuy]

My realtor has me set up to receive emails based on the criteria's that I gave her.
Right now, I ask her to send me all listing for $400K and less condo's in the Joyce skytrain area.
On the email, it shows all new listings, how long listings have been on the market and sold units with their sold prices, and any updates on current listings including price changes.

[punkwax]

^Do you get hot sheets? Hot sheets are sent to realtors as soon as homes hit the market, days before MLS. If you're just getting automatic emails that don't include hot sheets, your realtor can work harder for you

I had a deal done within 4 hours of my current house hitting the market. Had to act fast in this area, people were paying more than asking with no subjects. Not even a home inspection in one case

[SumAznGuy]

Originally Posted by punkwax

^Do you get hot sheets? Hot sheets are sent to realtors as soon as homes hit the market, days before MLS. If you're just getting automatic emails that don't include hot sheets, your realtor can work harder for you

I had a deal done within 4 hours of my current house hitting the market. Had to act fast in this area, people were paying more than asking with no subjects. Not even a home inspection in one case

Yes, but I am not actively looking right now so I'm not asking for them.
Based on what I see in the market, things are starting to happen where all the doom and gloom that 4444444444444444444444444444444 talks about is starting to come to fruition.
Maybe 2015 is the year where all the talk of the bubble bursting will happen.
It's been how many years of cheap interest rates.
All the condo's that have recently been completed with many more scheduled to be built.
Russian ruble and oil prices being so low.
Soon the taps may be turned off in China.

[GLOW]

Originally Posted by Special K

Thanks for sharing.

We just looked at a $900k 1/2 duplex in Marpole vs. $800k detached house on half narrow lot house in Ladner.

what's the age and sq-ft of the duplex & lot size and is it front/back or side-by-side? (i assume front/back).

also, if you're willing i think you can get an older van special in the 900k range in east van if you're willing to live there.

[blkgsr]

got my property assessment today, went up 8%

single family house in coquitlam

[punkwax]

Got mine as well. Went up 11% in South Surrey.

Assessed at 90k more than I paid 6 months ago

[UFO]

Originally Posted by sonick

^ +1, BCAssessment.ca

With how quickly the market can go up (in some cases), the bcassessment info isn't overly relevant to actual market pricing as it lags about a year behind. And the problem with public mls.ca is that it only shows active listings and asking prices, not whether the property has been price dropped, if it sold above asking, how long it took to sell, all of which are fairly important pieces of info if you are trying to figure out the market value of any property.

When we were looking at the end of 2014, bcassessment only had 2013 numbers. For what we were looking for, the assessed value from 2013 was about 10-20% below what actual market values were in q4 2014.

[Hondaracer]

my GF's grandmothers property and mothers property in east van, both north of 1st went up 80, and 100k :/

[GLOW]

mine looks like it went up 120k...

[Mr.HappySilp]

Originally Posted by SumAznGuy

My realtor has me set up to receive emails based on the criteria's that I gave her.
Right now, I ask her to send me all listing for $400K and less condo's in the Joyce skytrain area.
On the email, it shows all new listings, how long listings have been on the market and sold units with their sold prices, and any updates on current listings including price changes.

Joyce area isn't a really nice place to for the long run. Too much rental units and a lot of building have rental restrictions which lowers your value if you want to sell. I was looking for apartments with my sister around that area last year and too many times we see people coming the elevator/lobby with some fresh pick up food with sauce dripping out of the bags and not carrying a thing. That really said a lot about the people you will be living with. Oh and constant break ins in the parking area. One of the friends live there and their car got broken into twice so far.

[VR6GTI]

Originally Posted by punkwax

Got mine as well. Went up 11% in South Surrey.

Assessed at 90k more than I paid 6 months ago

Just remember that 90k assessment doesn't make you a penny until you actually put the house for sale and make a profit, until then your just paying more taxes to the city.

[Mr.HappySilp]

+1 I read somewhere that Surrey council has a spending problem | Vancouver 24 hrs Looks like Surrey property tax will go up by average of $162 per home.