Vancouver's Real Estate Market

[dinosaur]

There are many older places out there under $300k in Burnaby:

REALTOR.ca -Property Details V997056

REALTOR.ca -Property Details V991287

REALTOR.ca -Property Details V1004602

REALTOR.ca -Property Details V998827

REALTOR.ca -Property Details V1006499

I love it when people claim you can't find places under a certain dollar amount....all it takes is a quick mls search. Lots of places avail...

[GLOW]

Originally Posted by Gridlock

Out of curiosity, do you know why they are willing to take a 70k to move?

possibly to stop the bleeding of paying for an empty house?

when my parents moved back to vancouver during the previous "slump" over a decade ago they picked up their 'new' house that was sitting there for a year. the builder built 3 in a row and all were vacant for over a year. i think they wanted to pull their money out while they could...funny enough i think my parents bought their house for around $70k below the original asking price as well...

[Tapioca]

As I've said many times on this forum, as a condo owner, you don't own anything except an interest in a building and the rights to several hundred square feet of "air". The banks says you own something, but it's not the same as actual land.

The point isn't that you can't own something in Vancouver - the point is that you can't own something that is akin to what our parents had despite making 2-3 times the salaries that our parents did when they worked after adjusting for inflation. (For example, I personally made more 4 years ago than what my dad made upon retirement.) I'm sure most of us are willing to compromise (because life is about compromise), but a breaking point comes eventually.

[sdubfid]

Originally Posted by Tapioca

As I've said many times on this forum, as a condo owner, you don't own anything except an interest in a building and the rights to several hundred square feet of "air". The banks says you own something, but it's not the same as actual land.

Even that's stretching it since strata can fine you for farting too loud in your several hundred square foot cage

[Great68]

Originally Posted by Gridlock

Out of curiosity, do you know why they are willing to take a 70k to move?

Not entirely sure. The market was definately still higher back then than it is now. Plus, when they bought the house in 2010 the renos were brand new (Like driving a new car off the lot, you're immediately going to get depreciation).

They had two price drops during their listing period, and came down even further to meet my offer. I guess they didn't get a heck of a lot of bites? The house is not big (only 3bed 1 bath) and is older (50's rancher) so maybe a lot of people were put off by that? Not me though, I am more interested in the yard, big deck and detached garage it comes with. The house itself is fully renovated anyways.

[Graeme S]

It's funny. There are a bunch of houses in my area (capitol hill) listing for $850+ (one is going for 2.2mil!).

But the only one that's sold in the last four months is one that was listed at 780. And the one next door has been trying to sell for almost a full year now. Originally listed at 1.8, now listed at 1.6, but still no takers.

Patience.

[GLOW]

Originally Posted by Graeme S

It's funny. There are a bunch of houses in my area (capitol hill) listing for $850+ (one is going for 2.2mil!).

But the only one that's sold in the last four months is one that was listed at 780. And the one next door has been trying to sell for almost a full year now. Originally listed at 1.8, now listed at 1.6, but still no takers.

Patience.

probably because someone was able to afford $780k. 2.2 million

[akira112]

Originally Posted by Graeme S

It's funny. There are a bunch of houses in my area (capitol hill) listing for $850+ (one is going for 2.2mil!).

But the only one that's sold in the last four months is one that was listed at 780. And the one next door has been trying to sell for almost a full year now. Originally listed at 1.8, now listed at 1.6, but still no takers.

Patience.

Small town, I know the owner that just listed that 2.2 million house. Nothing I can afford in my lifetime.

[bing]

Originally Posted by Tapioca

Even detached houses in Surrey/Delta cost at least a half million. For an average upper middle class couple making a combined income of $150K year, that is still significant, particularly if you have to pay off student loans and have been unable to accumulate much in savings because you've been living away from home. You also have to factor in commuting costs over say 5-10 years. If you have to commute to Vancouver from Surrey, that costs you about 5 grand a year in insurance, gas, and maintenance.

Even if you could afford to buy a home for a half million, you're tied to a city with limited career mobility and a ceiling in terms of your income. No one would be too concerned if you could easily make 6-figure salaries after 10 years, but the problem in Vancouver is that most people top out at 6 figures.

150k combined household income is pretty good income by Vancouver standards. The average median household income is only ~60-65k. I know households with much less than 100k who were able to buy something in the 400-500k range. If people have to commute than so be it. Nobody says you have to buy either.

[Stormspirit]

Family just purchased a 800 SQ feet 15th floor, 2 rooms 2, washroom apartment.. will be fully constructed by 2016. Its the one right behind St. Albans / Granville 7-11. Its still a bunch of rocks right now.

Paying 380k total. Can rent out for 1100-1400 a month.

But most likely gonna live there for a year first since never lived in new place or apartment for long periods of time yet. hehe.

[4444]

Originally Posted by Stormspirit

Family just purchased a 800 SQ feet 15th floor, 2 rooms 1, washroom apartment.. will be fully constructed by 2016. Its the one right behind St. Albans / Granville 7-11. Its still a bunch of rocks right now.

Paying 380k total. Can rent out for 1100-1400 a month.

But most likely gonna live there for a year first since never lived in new place or apartment for long periods of time yet. hehe.

Presale purchase = fail. So much can change between what u think u bought and what u actually get. Is the strata fee set? I'll give u a hint - it will be more than whatevr u think it will be

1100-1400 is a huge range, and by 2016 interest rates will be higher than today

My advice, pull out of this deal, when its finished, similar places will be selling for nearer 280k than 380k - come back to this thread in 2016 and chastise me if I'm wrong, but I don't think I am

[VR6GTI]

Strata fee's always start out low. I think when i first moved into my place it was $180, 4 years later its $296. I'm sure next year ill see another increase.

Every year people say interests rates are going up, every year they are wrong. I guess someone has to be right sometime

[godwin]

I think you have to understand the perspective on interest rate.

They say interest rate must go up because it has been near 0.

So 0.5 -> 1% is still double in term of percentage.

Right now the govs have borrowed so much, it is not in their best interest to raise interest rates. However interest rate is also affected by inflation.. eg UK inflation is getting high and interest rate is one of the tools to control it.

The theory is people barely able to make payment at the current interest rate and will break their finances if say interest rate is raised too high.. or their purchase was bought at such a high price but the price has dropped so low now, it is impossible to refinance etc.

The things is if you are well off and have a lot of money, you can borrow money at a low cost to make more money (eg Apple and its bonds).. A lot of first time home buyers can't / don't get the best rates (besides it is usually locked in for 3 years?). That's where things can get bad.

When to watch? When Bernanke say QE is over.. that's the official sign that the cheap interest rate period is over.

Originally Posted by VR6GTI

Strata fee's always start out low. I think when i first moved into my place it was $180, 4 years later its $296. I'm sure next year ill see another increase.

Every year people say interests rates are going up, every year they are wrong. I guess someone has to be right sometime

[4444]

Originally Posted by VR6GTI

Strata fee's always start out low. I think when i first moved into my place it was $180, 4 years later its $296. I'm sure next year ill see another increase.

Every year people say interests rates are going up, every year they are wrong. I guess someone has to be right sometime

Fundamentals dictate that they MUST go up, it's a timing issue, but with e fed talking about cutting stimulus packages later this year, that's the first step (as stimulus was there to keep rates low, amongst other reasons), so by 2016 they will def be 0.50% higher, maybe 0.75%, who knows.

Ur right though ppl make stupid comments about the immediacy of them going up... That's not right, but long run, they have to

[Mr.HappySilp]

Originally Posted by Stormspirit

Family just purchased a 800 SQ feet 15th floor, 2 rooms 2, washroom apartment.. will be fully constructed by 2016. Its the one right behind St. Albans / Granville 7-11. Its still a bunch of rocks right now.

Paying 380k total. Can rent out for 1100-1400 a month.

But most likely gonna live there for a year first since never lived in new place or apartment for long periods of time yet. hehe.

Never buy presale as an investment. I made that mistake before
Things are never what you though it would be. Also they can change the completeion date always gets push back, you don't know your neighbours or how people living in the apartments, starta fees will go up for sure. 2016 is too long of a wait, other aparments might pop up near by, lowering the rental fee of your apartment.........

If you must buy, I suggest buy apartments that are around 3 to 5years range. This way you know how the area, neighbour will be like, how steady the stara fee increase is, roughy what is the actualy rental income you get,and also is sitll pretty new so nothing major needs to replace or fix. Price will be cheaper than new as well and you can actually see how well it is built.

[westopher]

Originally Posted by Stormspirit

Paying 380k total. Can rent out for 1100-1400 a month.

I don't understand purchasing a place in the GVRD to rent it out. I bought my 2 bedroom in edmonton for 240k, and rent it for 1400, and have a small positive cash-flow after taxes, stratas and mortgage. Wont you be losing like 500+ a month on this after all is said and done? Maybe I misunderstood, and you are buying this to live in and saying renting is an option, if you choose to leave?

[Traum]

Originally Posted by VR6GTI

Strata fee's always start out low. I think when i first moved into my place it was $180, 4 years later its $296. I'm sure next year ill see another increase.

I find it surprising that strata fees can climb that much in just 4 years. At my unit, I think we've only had 1 small strata fee increase over 4 years, and that was because the original hot water tanks had to be completely swapped out for a boiler system.

I also find it surprising that residents can put up with such a huge increase in strata fees, esp when the building is still relatively new. Certainly it gets voted down at the strata AGM?

[Bonka]

Developers tend to underestimate strata fees relative to actual operating expenses.

At the end of the day the deficit has to come from either:

- An increase in monthly strata fees or,
- A lump sum special assessment
Posted via RS Mobile

[GLOW]

i think poor money management can come in to play as well. especially when the strata doesn't know what to do or how to do it and does not spend the money well, or gets taken for a ride by a contractor or manager

[Bonka]

^ ^ ^

Great point about the strata council
Posted via RS Mobile

[Ferra]

Originally Posted by 4444

Presale purchase = fail. So much can change between what u think u bought and what u actually get. Is the strata fee set? I'll give u a hint - it will be more than whatevr u think it will be

1100-1400 is a huge range, and by 2016 interest rates will be higher than today

My advice, pull out of this deal, when its finished, similar places will be selling for nearer 280k than 380k - come back to this thread in 2016 and chastise me if I'm wrong, but I don't think I am

but people who made the most money out of real estate in the past 10 years are generally those who purchased presale
I never purchased a presale unit myself, but some of my family and friends did... many of them made $100K+ by the time their units closed (4-6 years)

I actually decided against buying a presale unit in 2009 because the market seemed all gloomy and everyone said RE was heading for a long downturn...
now 4 years later....those same units I wanted now cost $80k more on the resale market...

I am not supporting whether RE is going to go up or down, just saying that you never know what's the market is going to be like after a few years..

[Gridlock]

OMG.

I have a dislike for realtors. I met with 2 regarding my mom's condo yesterday.

The first guy was nice enough, once I told him to cut the shit. He was giving me this presentation of what he and his team can do for me on his ipad when I kindly told him I'm smarter than your average bear, and could we get to the good stuff.

He kind of laughed and broke character a little bit. His presentation featured an obscene amount of word art and acronyms. The 'S' stood for 'Sexy'...really?

Gives me his numbers, and a little about what we can do and off he goes. Kind of reminds me of Phil Dunphey from Modern Family.

The second guy:

The second worst kind of realtor. Wants me to list low so he can make a quick sale. Cheezy. Had a very take it or leave it attitude and asked me if my mom died in the apartment.

Nice.

Don't call me brah...I'll call you.

Ugh.

[Gridlock]

Strata Fees:

So in regards to the lame realtor yesterday^^, he did tell me about one thing regarding strata fees.

Apparently, the laws regarding their funding have changed that complexes need to have a depreciation report on all common property(siding, roofing, pipes, mechanicals) and have a funding plan for their replacement.

Basically, that backtracks to: we know we need to replace the roof in 10 years, we know its going to cost this much, so what does our strata fee need to be now in order to fund the maintenance of the building/complex.

So you are going to see a change in how buildings determine what their fee is going to be and how its charged.

[VR6GTI]

Originally Posted by Traum

I find it surprising that strata fees can climb that much in just 4 years. At my unit, I think we've only had 1 small strata fee increase over 4 years, and that was because the original hot water tanks had to be completely swapped out for a boiler system.

I also find it surprising that residents can put up with such a huge increase in strata fees, esp when the building is still relatively new. Certainly it gets voted down at the strata AGM?

If i ever attended one i could look into it but i don't. So i cant complain
Also i have one of the larger units at 1200sq+ so i think my increase would be more than someone with like 800sq

[Great68]

Originally Posted by Gridlock

OMG.

I have a dislike for realtors. I met with 2 regarding my mom's condo yesterday.

It's hard to guage how honest they really are.

When I bought my place I told our realtor what I thought my top dollar would be for the place, and funny how the price magically made it right to that value. Almost like the two real estate agents (mine & theirs) got together and said "Hey these guys will be willing to pay this much, so let's pretend to do a few negotiations and then get to that number"