Cory Raven | 604-220-9399

 
This was in the Globe and Mail today.  Arg!  I know people think multiple offers are a great thing and Realtors must love them, but a balanced market is much healthier and sustainable
 
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JENNIFER VAN EVRA

Special to The Globe and Mail

When Vancouver real estate agent Terry Flahiff listed the Kitsilano bungalow a few weeks ago, he knew it would generate interest. Located on the city's west side, the 1926 home featured hardwood floors, a large renovated kitchen, a bright two-bedroom basement suite, a white picket fence and a tree swing.

Sure, the yard was small, the view out the back was a giant condo complex, the bedrooms were tiny - the master was slightly more than 100 square feet - and it was just half a block off one of the city's busiest thoroughfares. Still, those shortcomings were quickly forgiven by the dozens of prospective buyers who streamed through the first open house saying, "Honey, I love it" and trying to imagine life without closets.

Five days later, seven agents lined up to make their offers. The asking price was $959,000, but because of the competition, they knew they had to push higher. Only two bids came in at less than $1- million, and in the end, the home sold for a staggering $1.142-million - more than $180,000 over the original price tag.

"My clients were hoping to get around $1-million or maybe $1.05-million," Mr. Flahiff says. "I think they were very happy."

As neighbours south of the border continue to pay the price for their housing market collapse, it seems that home buyers in Vancouver have forgotten the global economic downturn like it was yesterday's news - and that rush of optimism is fuelling a return to bidding wars.

Earlier this week on the Eastside, a partly updated Commercial Drive bungalow with a two-bedroom suite and a new garage and studio drew 10 offers - most of them with no inspections, despite the fact that the 1926 house needed a new roof, electrical upgrades and drain tile work, and had an old oil tank buried in the back yard. The first showing was Thursday last week, and on Sunday it sold for $113,000 over the asking price.

The same dizzying chain of events is being repeated around the city, where homes are selling in a matter of days, some for prices that sellers could not have imagined just a few months earlier. To make matters worse, many are being bought outright, because an offer that includes subjects (that is, the buyers want a few days to get an inspection or appraisal, finalize financing and so on) just can't compete.

According to veteran agent Rod MacKay, prospective buyers who have been waiting in the wings for the past year feel more confident about the economy and want to capitalize on the record low mortgage rates and reduced home prices before they drift outside their financial grasp. And because of the low mortgage rates, home ownership is now within reach for thousands of first-time buyers who had been priced out of the market, adding to the pressure at the bottom. Meanwhile, sellers aren't jumping in nearly as quickly: A third fewer houses were on the market this August than a year earlier, giving buyers a tough lesson in the laws of supply and demand.

"Prices have moved up 10 per cent in the last six months, so people are worried that if they wait for the perfect house, it won't be affordable," says Mr. MacKay, whose client offered $62,000 over the asking price on the Commercial Drive home, but landed near the bottom of the pack because her offer was contingent on getting two weekdays to finalize the financing. "So if someone is offering on a house that's $950,000, but they can afford $1.1-million, they think they'd better pay it now because that house will cost $1.75-million before they know it."

Still, experts say that even though Vancouver posted record sales in August - a whopping 117 per cent over the previous year - the overheated market is not likely to last. The backlog of buyers will purchase homes, and more sellers will enter the market, marking a return to a more balanced situation.

"The volatility has definitely been very surprising. We expected to see improvement from the recessionary lows, but we didn't see it rising this quickly," says Brian Yu, an economist with the British Columbia Real Estate Association, pointing to a steep decline in mortgage rates and low inventory as the central reasons behind the speedy return to a red-hot market.

"But the Vancouver numbers are showing some signs of plateauing, so the markets are probably going to stabilize over the next while," he says. "They can't increase at this rate forever."

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Developer Takes Unprecedented Step to Pass On Significant Construction Cost Savings to Pre-Sale Buyers in Yaletown


 
 

2009-03-18 00:04:45 -

Vancouver, B.C. - (March 17, 2009) - Prominent Vancouver-based developer Amacon has teamed up with MAC Marketing Solutions (MAC) to develop a unique, honest and first-of-its-kind construction cost savings initiative for The Beasley, a new Yaletown high-rise development. Amacon is taking unprecedented action by passing along construction cost savings to buyers, reducing the initial purchase price by a minimum of

22 per cent. The initiative will be called the 'pass it on' campaign.

The 'pass it on' campaign was made possible after Amacon spent months negotiating with their contractors, suppliers and trades. When Amacon reviewed the construction costs they could save, they decided to pass on the savings to the pre-sale buyers of The Beasley. The significant savings will also be offered to new purchasers. The brand new Yaletown condos start at $219,900 CAD ($170,200 USD). For many original home buyers, this refinancing option will deduct on average $100,000 - $250,000 from their initial purchase price.

'We are in a very different market than a year ago; when we negotiated our construction costs and realized the savings we made, we were happy to pass on that savings to our purchasers. We're putting everything out into the open as we see it's a win-win-win situation,' says Cameron McNeill, president of MAC. 'This sale will provide an unprecedented real estate opportunity for those who are interested in getting into Downtown Vancouver's real estate market at affordable prices.'

The Beasley real estate sale begins on Saturday, April 4, 2009. The sale will feature a collection of signature residences including bachelor, one-, two- and two-bedroom plus den suites ranging in size from 436 to 1,334 square feet. Soaring 33 storeys high, the sustainable condominium will introduce more than 200 homes to Yaletown and will be ready for occupancy July 2012.

'The Beasley is one of the only rare opportunities to buy a brand new home in Yaletown because there is very limited land available for high-rise development,' says Nic Jensen, manager of sales and marketing of Amacon. 'The decision to share our construction cost savings will create an exceptional buying opportunity for people who thought they could never afford to own real estate in a thriving downtown community such as Yaletown.'

The Beasley's Yaletown location is its best amenity. The condominium will be situated within minutes of the seawall, Robson Square, Vancouver Art Gallery, Orpheum, Queen Elizabeth Theatre, Library Square, GM Place and BC Place, as well as world-class dining and a variety of international retailers.

A tribute to urban excellence and vision, The Beasley is named after legendary Vancouver city co-director of planning, Larry Beasley. Tasteful interiors and finishings found in each home will include floor-to-ceiling windows, rich plank hardwood floors and gourmet kitchens with top-of-the-line KitchenAid Architect II Series stainless-steel appliances.

Amacon is one of Canada's premier new home builders with a reputation of building quality homes. With four decades of development and construction expertise, Amacon is recognized as one of Canada's most influential real estate development and construction firms. Laying the foundation with excellence, Amacon controls all aspects of the development process including, site acquisition, project design, development, construction, marketing and sales.

MAC Marketing Solutions Inc. is a marketing and sales organization specializing in both residential and resort real estate developments in Metro Vancouver, Interior B.C. and Calgary. Founded in 2001 by Cameron McNeill, MAC continues to be a proven leader in sales with respect to volume and dollar value. Over the past five years, the company has sold more than $4-billion worth of real estate.
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I had a client ask me to run some numbers and thought I would share.  Given the seemingly daily news about financial crisis, US housing bubbles, $100 million dollar loans for Millennium Development's Olympic Village, and prices now declining in Metro Vancouver, I was curious as to what I would find.
 
This is just a small snapshot and doesn't look at the "macro" market.  It is for 5 year old (and older) buildings in Kits that are freehold and allow rentals.  I ran each month from October 2007 to October 2008.  We just looked at MLS sales, not at listings that were canceled or expired.  Private Sales are not part of this study.
 
Some notes that will make it easier to read
 
DOM = Days on Market, the number of days it took to sell from the time it was listed
PSF= Price per square foot.  In the real estate world, this helps us compare apples with apples.  We take the sale price and divide it by the square footage and get the price per square foot.
 
This information, although compiled by myself, is courtesy of the Real Estate Board and although assumed to be correct has not been verified.
 
Have a look, although there are signs of a "Buyer's Market" as we move from Oct 2007 to today, I think the results may surprise you.
 
I am going to be working on the same type of information sheet for other areas as well.  Is there one you would like to see or some other Real Estate question I can help you with? Drop me a line at cory@coryraven.com
 
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Please excuse the mess while I upgrade my website.  In the meantime, you may access all my blog posts by clicking here.
Please excuse the mess while I upgrade my website to provide you with even more timely and topical information on our market and the process of buying and selling.  In the meantime, you can access my blog by clicking here
Cory Raven
Telephone:604-220-9399
Cory Raven - Managing Broker
RE/MAX Select Realty
4806 Main Street
Vancouver, BC
V5V 3R8