Vancouver's Real Estate Market

[VR6GTI]

Originally Posted by EndLeSS8

So my parents helped my wife and I to buy a pre-sale apartment near Metrotown. It's due for completion in 2017

I got a phone call yesterday from the realtor who sold it to us, saying that she has on offer for my place (again, unfinished, due to complete in 2017) of $100k above what we're paying for it. She says we'll pocket $80k out of it

Seems shady....
I'm new to this whole crazy real estate crap, any thoughts?

Seems shady but they might have a client looking in the area?
80k in your pocket seems like a great investment but just be weary that if your place has gone up that much in value everything in the area probably has and you might be stuck out of the market or caught in a bidding war.

[SumAznGuy]

Originally Posted by EndLeSS8

So my parents helped my wife and I to buy a pre-sale apartment near Metrotown. It's due for completion in 2017

I got a phone call yesterday from the realtor who sold it to us, saying that she has on offer for my place (again, unfinished, due to complete in 2017) of $100k above what we're paying for it. She says we'll pocket $80k out of it

Seems shady....
I'm new to this whole crazy real estate crap, any thoughts?

First off, did you sign any assignment restriction contract with the pre-sales people?
Secondly, ask yourself this. How much did you pay for your unit?
If you were to buy another pre-sale unit that is similar in size and location, how much more would it cost you?
Without knowing #2, it's hard to say yes or no to it being shady.
For example, if you bought the unit last year for $500K and now it cost $800K to buy a similar unit, then yes it is a little shady.

Oh wait. Just re-read your post. I say yes.
It was the selling realtor that contacted you, not your buying realtor.
Check on MLS and see what similar units are going for and I bet VR6GTI is right and that the market may be up more than $100K a similar unit.

[Bonka]

Originally Posted by EndLeSS8

So my parents helped my wife and I to buy a pre-sale apartment near Metrotown. It's due for completion in 2017

I got a phone call yesterday from the realtor who sold it to us, saying that she has on offer for my place (again, unfinished, due to complete in 2017) of $100k above what we're paying for it. She says we'll pocket $80k out of it

Seems shady....
I'm new to this whole crazy real estate crap, any thoughts?

This is an assignment sale. The seller (you and your wife) are assigning the terms of the purchase agreement you and your wife agreed to with the developer to a 3rd party (the new buyer). The new buyer assumes all the costs, risks and responsibilities of the purchase agreement. For example, if you still have deposit money owing to the developer, the new buyer would now be responsible for it.

Normally developers will not allow assignments until a certain % of units are sold but given the market likely the reason your realtor has this "opportunity" for you.

Your realtor will collect commission on the buying end when you bought, and will collect another commission (sounds like they know the buyer) on the assignment.

Assuming you two bought for the purposes of living in it, it's probably better to hang on to it unless difference is covered and you come out ahead buying something comparable, or the market tanks.

[beatdownvictim]

Originally Posted by SumAznGuy

Co-worker just told me about this house that is for sale.
7338 Ontario Street.
BC Assessment shows it sold for $960,000 in March 2014 when it was still in it's older building form.
The old house was torn down and a new house was built.
The new house was listed for sale last year for $2.2M
7338 ONTARIO Street in Vancouver: South Vancouver House for sale (Vancouver East) : MLS(r) # V1132315

Now, it has up for sale again.
Anyone wanna guess what the asking price?

Spoiler!

$4.5M
https://www.locatehomes.ca/bc-real-e...8?id=262093105

I am curious to see how much it actually sells for.

I took a look at that house last year, originally it was listed by Winnie lam at 2.3, then paul eviston took it at 2.2. Back then I thought it was crazy someone would spend 2.2 mill + GST in that area...(boy was i wrong)
House shows nicely but its a 30x131 lot so a little narrower.
Sold for 2.2 and now they live in it for a year and flip..those 2 real estate agents are dreaming big if they think they can get that number.

A lot better homes out there for 4 mill and in a better area

[Gumby]

Originally Posted by SumAznGuy

Co-worker just told me about this house that is for sale.
7338 Ontario Street.
BC Assessment shows it sold for $960,000 in March 2014 when it was still in it's older building form.
The old house was torn down and a new house was built.
The new house was listed for sale last year for $2.2M
7338 ONTARIO Street in Vancouver: South Vancouver House for sale (Vancouver East) : MLS(r) # V1132315

Now, it has up for sale again.
Anyone wanna guess what the asking price?

Spoiler!

$4.5M
https://www.locatehomes.ca/bc-real-e...8?id=262093105

I am curious to see how much it actually sells for.

WTF its current assessed value is $1.953M. Whoever set the new asking price of $4.5M is out to lunch! The lot is narrow, but deeper than usual (30x133 vs standard size of 33x122), with a laneway house.

Side note - I'm 10 blocks north of that location in a new build as of 2013. My assessed value is $1.8M - no way in hell could I sell for $4M+.

Originally Posted by beatdownvictim

A lot better homes out there for 4 mill and in a better area

Agreed 100%.

[beatdownvictim]

hey gumby, i'm building near you then

[dat_steve]

hard to say no to $80k for a year or two (assuming you put your deposit down mid 2015?) of doing nothing imo

as others have said, just make sure you and your wife have somewhere to live

[Gumby]

Originally Posted by beatdownvictim

hey gumby, i'm building near you then

Haha tons of new houses being built in the Langara area! Good luck with your build - it was one of the most challenging things I have ever experienced.

[Tapioca]

Originally Posted by Bonka

Assuming you two bought for the purposes of living in it, it's probably better to hang on to it unless difference is covered and you come out ahead buying something comparable, or the market tanks.

Taking the money and running only makes sense if you really have soured on the building or area and want to get out. Maybe there's an investment or business opportunity the OP has in mind?

The OP will take the 80K and spend another 80K-100K on the property they really want. It's the way the market is right now.

[Hondaracer]

Ask for 120 and move a bit east

[Adorkami]

Originally Posted by originalhypa

Your logic is flawed.
Most of the complaints in Vancouver aren't about getting a Rolls. It's about not being able to afford living in the city that you grew up in because it's turned into a part time playground for the wealthy.

Give your head a shake, then read this.

It takes 23 years to save for a down payment in Metro Van, says study | Globalnews.ca

Most of the complaints are about people who think they deserve something because others have it and they aren't able to put the work in. If you are willing to work there is always money to be made regardless what is handed to you.

If you are buying a house for 812,653 why do you need to put 20% down? You need to only put down 51,265.30 instead of 162,530. The difference of $106,265.30 seems like a big oversight... or are they assuming they cant get mortgage insurance. Also are they assuming that the 15% saved yearly is being stored under your mattress? 7076.70(15% of income) x 23 years is 162764.10, I'm assuming they think in 23 years you will make 0 interest.

[Tapioca]

I appreciate Paul Kershaw's campaigning on the struggles of the 20 and 30-somethings. However, one flaw in the report is that it uses an average home price. There are lots of detached homes on big lots that are skewing that average. What we should really be looking at is other metrics, such as housing size, walk and transit scores, etc.

When my parents bought in East Vancouver eons ago, East Van was considered a dump that people of Anglo-Saxon descent would never buy into unless they were on social assistance. East Van was what Maple Ridge is today. The goal posts have changed.

People can still buy in this city, but not in the neighbourhoods they grew up in. Metro Vancouver is really 20+ neighbourhoods with different street signs. Condos are the new bungalows. I have argued that foreign ownership is playing a big role here, but even if you were to restrict it tomorrow, I think there are too many people here who want to stay or move here.

[EndLeSS8]

Thanks for the insight guys, much appreciated

Right now my wife and I are renting a separate apartment from my in-laws, so we have a place to stay.

I am not familiar with all of this, but I know that my new place to be built (the 2017 one near Metrotown) was sold out quite fast.

[SumAznGuy]

Originally Posted by EndLeSS8

Thanks for the insight guys, much appreciated

Right now my wife and I are renting a separate apartment from my in-laws, so we have a place to stay.

I am not familiar with all of this, but I know that my new place to be built (the 2017 one near Metrotown) was sold out quite fast.

Double check and see if you signed any assignment contracts. The penalty is around 1.5%.
But most importantly, how much would it cost to buy a replacement unit that is comparible to the one that you would be giving up.
Since you bought last year, there is a good chance the market has gone up more than $100K so really do your homework.

If you want, just post up the #of sq ft plus #of bedroom and # of bath rooms and I am sure someone here can give you a rough idea what a replacement unit will cost you.
Is it a high rise or low rise?

[Ch28]

It also sounds like EndLeSS8 and his wife bought the place to live in, which is a huge difference than buying it as an investment. They likely spent a lot of time looking into the area because they actually want to live there, and this was one of the better options they had.

[imp>dom]

Originally Posted by EndLeSS8

So my parents helped my wife and I to buy a pre-sale apartment near Metrotown. It's due for completion in 2017

I got a phone call yesterday from the realtor who sold it to us, saying that she has on offer for my place (again, unfinished, due to complete in 2017) of $100k above what we're paying for it. She says we'll pocket $80k out of it

Seems shady....
I'm new to this whole crazy real estate crap, any thoughts?

Which development?

[EndLeSS8]

Originally Posted by SumAznGuy

Double check and see if you signed any assignment contracts. The penalty is around 1.5%.
But most importantly, how much would it cost to buy a replacement unit that is comparible to the one that you would be giving up.
Since you bought last year, there is a good chance the market has gone up more than $100K so really do your homework.

If you want, just post up the #of sq ft plus #of bedroom and # of bath rooms and I am sure someone here can give you a rough idea what a replacement unit will cost you.
Is it a high rise or low rise?

High rise, 2 bed, I think it's 2 bath...? I forgot on that
approx. 760 sq feet

[nma]

Originally Posted by Bonka

This is an assignment sale. The seller (you and your wife) are assigning the terms of the purchase agreement you and your wife agreed to with the developer to a 3rd party (the new buyer). The new buyer assumes all the costs, risks and responsibilities of the purchase agreement. For example, if you still have deposit money owing to the developer, the new buyer would now be responsible for it.

Normally developers will not allow assignments until a certain % of units are sold but given the market likely the reason your realtor has this "opportunity" for you.

Your realtor will collect commission on the buying end when you bought, and will collect another commission (sounds like they know the buyer) on the assignment.

Assuming you two bought for the purposes of living in it, it's probably better to hang on to it unless difference is covered and you come out ahead buying something comparable, or the market tanks.

While the new buyer does assume your contract, you as the original purchaser are still responsible to complete if the new buyer fails to go through with the transaction.

[superdennis]

Originally Posted by imp>dom

Which development?

I'm guess the met 2 or the park on Nelson
Most likely met 2, completion summer 2017

$100k sound pretty reasonable for a 2 bed assignment
Had a client recently bought an assignment at the met 2 for $52k

[UFO]

Originally Posted by originalhypa

Your logic is flawed.
Most of the complaints in Vancouver aren't about getting a Rolls. It's about not being able to afford living in the city that you grew up in because it's turned into a part time playground for the wealthy.

Give your head a shake, then read this.

It takes 23 years to save for a down payment in Metro Van, says study | Globalnews.ca

No sense in using an average home price north of $800k, as mentioned it is skewed by the multi millions that detached houses are fetching. Plenty of easily affordable homes in Vancouver proper from $300k and up, even less depending on area. This is what first time home buyers enter the market with. But if you're picky about size, finishes, area, as one should be with such a big purchase, just understand that this will cost you more.

Nobody 'should' be able to buy where they grew up for the sole reason that they grew up there...

Originally Posted by EndLeSS8

Thanks for the insight guys, much appreciated

Right now my wife and I are renting a separate apartment from my in-laws, so we have a place to stay.

I am not familiar with all of this, but I know that my new place to be built (the 2017 one near Metrotown) was sold out quite fast.

You could always ask for more than they offered, see where that goes. Don't view it as making an easy $80k because you will in all likelihood spend at least that if not more to get into something comparable. So you've gained nothing but more work for yourself, opening yourself up to bidding wars, and worrying if you'll get something at your set budget.

[lowside67]

Originally Posted by UFO

No sense in using an average single family home price north of $800k, as mentioned it is skewed by the multi millions that detached houses are fetching. Plenty of easily affordable homes in Vancouver proper from $300k and up, even less depending on area. This is what first time home buyers enter the market with. But if you're picky about size, finishes, area, as one should be with such a big purchase, just understand that this will cost you more.

The number they keep using for Vancouver is the average detached single family home. And there ain't none of those for $300k.

Mark

[Tapioca]

The average detached home in the 1970s was a bungalow on a 33 foot lot with an unfinished basement, 2 bedrooms on the main floor, 1 bathroom, a carport, and 1200 square feet of actual living space. The only transit available was likely a bus that ran every 20-30 minutes. My parents' first house was one of these bungalows.

The average townhouse today is 1300-1600 square feet with more bedrooms, more bathrooms, and an attached garage.

The average detached home today is over 3000 square feet with 5 bedrooms, 3-4 bathrooms, 2 kitchens, with an detached 2 car garage. Transit is a bus that runs every 10 minutes.

This comparison in no way fully justifies the increase in real estate since the 1970s, but it is some food for thought.

[UFO]

Originally Posted by lowside67

The number they keep using for Vancouver is the average detached single family home. And there ain't none of those for $300k.

Mark

Pretty sure $800k avg is not the avg detached house pricing in Vancouver proper, but avg of all types of homes

But why is this 24-35 demographic having to buy into detached right off the bat? As I mentioned, lots of condo/townhouse type homes that you CAN get at $300k. There are plenty of 'affordable' homes available, but also many who are picky as F and feel that just because they rented a studio in Kits they should be entitled to buy a house there for half of what actual market value is.

[Tapioca]

Originally Posted by UFO

But why is this 24-35 demographic having to buy into detached right off the bat? As I mentioned, lots of condo/townhouse type homes that you CAN get at $300k. There are plenty of 'affordable' homes available, but also many who are picky as F and feel that just because they rented a studio in Kits they should be entitled to buy a house there for half of what actual market value is.

To be fair, I think a lot of people only want what they had when they grew up - a modest house with a yard within walking distance to the corner store and school.

The problem is that the Lower Mainland has changed. There are more people here than there were in the 1980s and there are fewer detached lots to serve the population increase. Capital (people and money) is now global and relatively unrestricted. Every time there is a major repurposing of Crown land to residential, it faces intense scrutiny from th media, municipalities, special interest groups, and First Nations. It's amazing the sale of Crown land on Burke Mountain was approved.

Combine these factors with a prolonged period of low interest rates and a transfer of wealth from the boomers to the millenials and you have a perfect storm.

[Great68]

Originally Posted by Tapioca

The average detached home in the 1970s was a bungalow on a 33 foot lot with an unfinished basement, 2 bedrooms on the main floor, 1 bathroom, a carport, and 1200 square feet of actual living space. The only transit available was likely a bus that ran every 20-30 minutes. My parents' first house was one of these bungalows.

That was my parents' first house, except minus the basement because Richmond. At least it had a detached garage.

That house is completely gone now, with a massive lot-filler in it's place