Real Estate discussions

[svlt]

I think people want somewhere to live in now as more of the buyers are actually looking to upgrade or change their immediate living circumstances in light of COVID. The frenzy is different this time around than with 2015-2017 where there was a flood of interest in condos as investments/AirBNBs and the presale market was bananas. Nowadays it's moreso to upsize or to purchase first homes.

Just personal observations.

[rofina]

I would also say the 1 bedroom market is soft.

I have divested of everything in Vancouver in 2020, but I'm seeing what I would consider as "deals" for smaller units today.

Some appealing units in the $500k range, good locations, great long term rent prospects.

[CondoInvestor]

2bed and 3bed condo markets are soft

[svlt]

You usually need a bit of time to build up the wealth and home equity to move up. We went from 1 to 2 to 3 over the period of a decade because that's just all we could afford at that stage of our lives. Going out and getting a 3br to start is near impossible at today's prices.

[whatnext]

Oh the LeShame of it all. Good thing SSPers have assured us money laundering isn't a thing.

LeHomes Realty fined $282K for anti-money laundering violations
Among other violations, the real estate brokerage failed to develop and maintain a written and ongoing training program for its staff on anti-money laundering.
Graeme Wood
about 23 hours ago

B.C. real estate brokerage firm LeHomes Realty has been fined $282,397 for not complying with the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.

The brokerage is officially known as Pan Pacific Platinum Real Estate Services Inc. and formerly known as New Coast Realty, which has a history of regulatory findings against it.

LeHomes failed to submit a suspicious transaction report where there were reasonable grounds to suspect that transactions were related to a money laundering offence, according to findings from the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) issued in a statement Oct. 6.

Numerous other violations were found. LeHomes failed to ensure that an appointed person was responsible for implementing a compliance program; failed to develop and apply sufficient compliance policies and procedures for its regulatory obligations relating to third-party determination, receipt of funds records and business relationships and ongoing monitoring; and failed to take into consideration the money laundering or terrorist activity financing risk of its products and delivery channels, its geographic location or its clients and business relationships....

https://www.burnabynow.com/local-new...ations-5921011

[WarrenC12]

Originally Posted by whatnext

Oh the LeShame of it all. Good thing SSPers have assured us money laundering isn't a thing.

Who said it wasn't a thing? These are the same criminals that have been in trouble a number of times.

[Sheba]

Metro Vancouver pre-sale condo market slows as buyers retreat, developers delay projects

Sales of condos and townhomes that won’t be delivered for several years have dramatically slowed to levels not seen in a decade.

Industry observers say rising interest rates and economic uncertainty are causing buyers to retreat and developers to delay projects.

...

Real estate agents in North Vancouver anticipated two projects would start pre-sale contracts this fall, but both launches have been pushed to next spring or later, examples of what has been happening elsewhere in Metro Vancouver.

Those include Lennox at Lonsdale, a project by Polygon Homes for 64 condos, and Emerald by Ebb and Flow, a development by Woodbridge Homes and Citimark for 41 townhomes. Agents say they were expecting sales centres or registrations to start around September, but they were delayed.

...

[Changing City]

Originally Posted by whatnext

Oh the LeShame of it all. Good thing SSPers have assured us money laundering isn't a thing.

As Warren noted, I don't think anybody has said money laundering doesn't exist. Just that it isn't the reason why property prices have become unaffordable for many would-be buyers. As the inquiry into money laundering earlier this year confirmed.

[Changing City]

Originally Posted by Sheba

Metro Vancouver pre-sale condo market slows as buyers retreat, developers delay projects

Thanks for digging that out. As interest rates are likely to keep rising for a while, and prices of resales are falling, it's reasonable to expect developers will hit the pause button. In Vancouver, at least, some developers seem to have anticipated that and switched to market rental projects, (helped by Council policy). It'll be interesting to see if that happens in Burnaby, Surrey and other markets in the next year or two.

[whatnext]

Originally Posted by Changing City

As Warren noted, I don't think anybody has said money laundering doesn't exist. Just that it isn't the reason why property prices have become unaffordable for many would-be buyers. As the inquiry into money laundering earlier this year confirmed.

The exact quote regarding money laundering from the report did not say money laundering is not one of the reasons. It said it required further study

...the Cullen Commission said it is not clear that money laundering is the cause of housing unaffordability. “The public discussion about, and interest in, money laundering has been fuelled, in part, by rising real estate prices,” Mr. Cullen wrote. But he said it would take more study to determine if that is in fact the case....

https://www.theglobeandmail.com/cana...w-of-billions/


Meanwhile in today's Vancouver Sun:

Vancouver drug lord gets 14 1/2 years in U.S. prison
A California jury convicted Chiu last March on conspiracy and drug charges. And earlier this month, U.S. district court Judge John A. Kronstadt sentenced the 44-year-old to 14 ½ years in prison.
Author of the article: Kim Bolan
Publishing date: Oct 27, 2022

....A California jury convicted Chiu last March of conspiracy and drug charges. And earlier this month, U.S. district court Judge John A. Kronstadt sentenced the 44-year-old to 14 ½ years in prison.

The U.S. Attorney’s sentencing memo, obtained by Postmedia News, said Chiu “led an international drug trafficking organization that spanned from Mexico to Canada, exporting hundreds-of-pounds of cocaine and heroin, with an estimated wholesale value of at least (US)$4.5 million.”....

....“The government is trying to portray Mr. Chiu as a cunning leader of a drug organization while the defence is maintaining that he is a mere foot soldier who was taking marching orders,” the memo said. “Before this case, he was running an honest real estate and property management business. Under the government’s theory, Mr. Chiu magically transitioned overnight from the real estate field to the head of a drug trafficking organization.”

In fact, Chiu was investigated by Vancouver police for drug trafficking years before his arrest in the Los Angeles case.

Both he and his brother Richard were subjects of the VPD’s Project Tar that probed drug traffickers who allegedly laundered cash through Silver International — the illegal Richmond bank that was the subject of the RCMP’s ill-fated E-Pirate investigation. Neither brother was charged in the VPD case. Richard Chiu was found murdered and burned in Colombia in June 2019 — a day after he arrived in the South American country for meetings....

https://vancouversun.com/news/local-...-in-u-s-prison

[Changing City]

Originally Posted by whatnext

The exact quote regarding money laundering from the report did not say money laundering is not one of the reasons. It said it required further study

...the Cullen Commission said it is not clear that money laundering is the cause of housing unaffordability. “The public discussion about, and interest in, money laundering has been fuelled, in part, by rising real estate prices,” Mr. Cullen wrote. But he said it would take more study to determine if that is in fact the case....

https://www.theglobeandmail.com/cana...w-of-billions/

That's not a complete quote from the the report - it's edited.

Here's the actual section of the report (page 40), including the section heading for the hard-of-thinking.

"Money laundering is not the cause of housing unaffordability

The public discussion about, and interest in, money laundering has been fuelled, in part, by rising real estate prices and the belief, by some, that high prices are the result of money laundering in BC real estate. Public attention has also been captured by the issue of foreign ownership in the BC real estate market. While the impact of money laundering and anti–money laundering measures on real estate prices is something that would benefit from further study, I am unable to conclude that money laundering
is a significant cause of housing unaffordability in the residential real estate market.

I wish to be clear that I do not urge the provincial government to take up the recommendations contained in this Report on the basis that they will resolve British Columbia’s housing affordability challenges. There are strong reasons to think that fundamental factors such as supply and demand, population increase, and interest rates are far more important drivers of price. Money laundering should be addressed, to be sure, but steps taken to counteract money laundering should not be viewed as a solution for housing unaffordability."

[Migrant_Coconut]

We've already got the FBT and EHT to control artificial demand. Now we need to work on supply.

[Forager]

As a Realtor myself, I truly endeavour to conduct my business with integrity, honesty, and respect. Yeah, I know many of you are splitting a gut right now, but I find it incredibly frustrating that a few unscrupulous/willfully blind agents ruin the reputation of the entire industry.

My take on our sky-high prices in Metro Vancouver is that much of it is fueled by investors/speculators and exacerbated by a lack of supply due to an ultra-slow permitting and zoning process at City Hall. Few homeowners have deep enough pockets (or stomach) to withstand the protracted process to build higher density homes which would increase supply and eventually relax prices (and rents).

[whatnext]

Originally Posted by Forager

As a Realtor myself, I truly endeavour to conduct my business with integrity, honesty, and respect. Yeah, I know many of you are splitting a gut right now, but I find it incredibly frustrating that a few unscrupulous/willfully blind agents ruin the reputation of the entire industry.

My take on our sky-high prices in Metro Vancouver is that much of it is fueled by investors/speculators and exacerbated by a lack of supply due to an ultra-slow permitting and zoning process at City Hall. Few homeowners have deep enough pockets (or stomach) to withstand the protracted process to build higher density homes which would increase supply and eventually relax prices (and rents).

Yep, investors and speculators like these folks. Nice to see them face legal consequences. I'm sure snapping up multiple properties had absolutely nothing at all whatsoever to inflate housing prices.

Real estate investor ordered to pay close to $1M for backing out of B.C. property deal
-Na Cao walked away from contract to buy Tsawwassen home after friends told her she was overpaying
Bethany Lindsay · CBC News · Posted: Dec 21, 2022

A real estate investor who abruptly backed out of a contract to buy a home overlooking the Strait of Georgia and refused to pay a $300,000 deposit is now on the hook for nearly $1 million, with no property to show for it.

Na Cao walked away from the deal she'd signed in November 2016 to buy 917 Pacific Dr. in Tsawwassen, B.C., for $4.45 million, after friends suggested she was overpaying, according to a recent B.C. Supreme Court decision.

She and her husband, Xin Qiang Li, both ignored warnings from their real estate agent and threats from the homeowner that they could be in legal trouble for reneging on the deal, Justice Matthew Kirchner wrote in a judgment on Friday....

...Kirchner ordered Cao to pay the property's owner, Jeffrey Kaltenegger, $970,000 plus legal costs for the difference between the price she'd agreed to pay and the $3.48 million the house eventually sold for in May 2018, after the market had cooled.

The lengthy judgment lays out the history of the abandoned deal and Cao's failed arguments for why she was justified in her actions.

At the time she made an offer on Kaltenegger's five-bedroom house atop English Bluff, Cao and Li had already made a number of real estate purchases in the Vancouver area.

In audio messages to realtor Jia (James) Liu in October 2016, Li had said the couple was interested in buying "several houses this time," the judgment says.

Cao and Li spent just 20 minutes at the Pacific Drive property before they decided to place an offer. During the same visit to the Tsawwassen neighbourhood, they also toured a second home and placed an offer on that as well....

...Cao also tried to claim that she misunderstood how the deposit worked, believing if she didn't pay it, the contract would be voided. But as the judge pointed out, she and Li were experienced business people who had previously purchased two properties in Vancouver using similar contracts...

https://www.cbc.ca/news/canada/briti...deal-1.6693167

[BaddieB]

.

[SpongeG]

Suspected 'sham' marriage may have been designed to fool Canadian and Chinese officials, judge says

B.C. divorce decision lays out suspicions about 2-year union between new arrival and recent citizen

Bethany Lindsay · CBC News · Posted: Aug 18, 2023

The unhappily married couple was introduced by an immigration consultant. Before their marriage, the husband transferred significant sums of money and a piece of real estate to his Canadian bride-to-be.

He also claimed to be penniless when he arrived in Canada, but Branch said that may have been a "charade." Once in the country, "his friends and relatives showered him with large cash 'gifts'" totalling more than $300,000.

He purchased an apartment at the University of British Columbia for $1.1 million shortly before the marriage, but then gave Shen a 99-per-cent ownership stake, even though she contributed nothing to the purchase, according to the decision.

https://www.cbc.ca/news/canada/briti...sham-1.6939806

[whatnext]

Originally Posted by SpongeG

Suspected 'sham' marriage may have been designed to fool Canadian and Chinese officials, judge says

B.C. divorce decision lays out suspicions about 2-year union between new arrival and recent citizen

Bethany Lindsay · CBC News · Posted: Aug 18, 2023





https://www.cbc.ca/news/canada/briti...sham-1.6939806

Surely you're not suggesting they had a sham marriage and concealed their assets when immigrating here? Our most illustrious forumers have assured such things as surreptitiously sneaking money out of China to invest in Canadian real estate simply doesn't happen! I'm sure they'll quickly dismiss this as a "one off".

[whatnext]

Originally Posted by Sheba

Metro Vancouver pre-sale condo market slows as buyers retreat, developers delay projects

Could the bubble finally be bursting, a year after the market started to slow?

....Residential land deals
It is not only homeowners who are dealing with a foreclosure, or the threat of it.

In Vancouver, in the wake of the collapse of developer Coromandel Properties in February 2022, a nine-lot, 0.67-acre land assembly next to the Nanaimo SkyTrain station is offered under a court-ordered sale by Colliers at $20 million. The parcel was bought two years ago for $29 million. It has not sold, reflective of the fact that Metro Vancouver land sales have plunged 62.6 per cent so far this year, compared to 2022.

Slowing condo sales and rising construction costs have stalled several new residential projects in Vancouver as developers seek deadline extensions. These include projects that were approved two years ago, including a 49-storey tower with nearly 200 condos and 162 rentals by Wesgroup Properties at 1450 West Georgia Street, and a planned 289-unit condo tower at 1650 Alberni Street by Landa Global Properties.

Rumours are swirling in Vancouver real estate circles that some condo projects may soon follow Coromandel into receivership.

https://biv.com/article/2023/11/faci...housing-market

[Forager]

Originally Posted by whatnext

Could the bubble finally be bursting, a year after the market started to slow?

Boots on the ground, my sense is that we're potentially on the cusp of some real changes here. It's like in the cartoons when the Coyote runs off the cliff and hovers mid-air for a couple seconds before plunging into the canyon. Are we that coyote, hovering mid-air? Possibly.

Sales have slumped this October 30% below the seasonal average, and anecdotally, I've noticed a lot of developers offering more lucrative sales incentives to both buyers and agents. As well, there seems to be an abundance of downward price adjustments, esp. for pricier single detached homes and homes south of the Fraser. Meanwhile, a sharp rise in new listings has filled the inventory gap that has characterized this market over the past several years.

It'll be interesting to see where this goes. I speculate that we'll see more softening of prices, at least through the slower winter months. Meanwhile, there are still record number of people moving to the region who need homes. Ceteris paribus, I suspect that once we start to see rates relax, we'll see rapid price gains again.

[chowhou]

Originally Posted by Forager

It'll be interesting to see where this goes. I speculate that we'll see more softening of prices, at least through the slower winter months. Meanwhile, there are still record number of people moving to the region who need homes. Ceteris paribus, I suspect that once we start to see rates relax, we'll see rapid price gains again.

Current 3M CDOR is pricing in a 25 point drop for the December announcement and a 100 point drop between now and the December 2024 announcement.

If that holds true, then I can't imagine prices staying soft for too much longer.

On the other hand, anecdotally I have heard from more that one person that they or their neighbours cannot afford their current mortgage and are going to have to sell soon. Housing has sticky prices because people don't like moving or selling their house, but if they're forced to that changes the calculus a bit.