The BC Real Estate Discussion Thread

[Elias Pettersson]

1 hour ago, 24K PureCool said:

Grandfathering is the easy part. Tax excess properties at like 50% of valuation unless it is on the market and no reasonable offers are refused. If some rich billionaire want to pay that then be my guest. 

 

The rental part is tricky but the idea here is to allow people to own homes more than they need to rent and those that are starting out in their career or in college can take on the apartment rentals which are usually all they need to start out. 

 

Anyways it is a pipe dream as the collapse in the housing market is gonna be a whole other can of worms with how the economy is currently setup. 

 

If this is going to be implemented it is gonna be decades long process so things don't just go kaboom. 

Another option for the government is to increase the capital gains tax on rental properties.  Right now the tax is 50% of the gain on the property.  If they make it at 100% then that may push investors to get out of the rental market and look for other means to make money.  Increasing taxes is never a good thing though and it usually leads to governments losing elections, so these politicians won't want to piss off the people that voted them in.

[HI5]

Condo I’m looking at is an assignment listing, looks like it’s roughly about 100k over what they paid pre sale. Anyone know how GST works on reassignments? Im guessing I have to pay it afterwards, when I get mortgage approval?

 

Based on what I’ve been able to gather online looks like 2-4% closing costs (I assume this includes land transfer tax) and 5% GST. 

[Boudrias]

12 hours ago, Elias Pettersson said:

In theory that is a concept that a lot of people could get behind. The problem with that however is you are decreasing the amount of rental inventory in the marketplace. If you ban the purchase of real estate for investors then that reduces the rental inventory out in the market which is already at an all time low with vacancy rates near zero percent. 
 

Also, how do you grandfather all of the rental properties currently owned by individuals?  Do you force them to sell?  
 

This idea in theory makes sense but in reality would create more problems than it would solve. 
 

We need the governments to cut the red tape and allow more inventory to come into the market. Immigration is at an all time high. More people are moving to Vancouver than ever before. Roughly 25% of a developers profit goes to the government in the form of density fees. The government actually makes more money on a new development than the actual developer. Government density fees account for an increase of around $180,000 to the cost of a typical condo in Vancouver.  That’s crazy. 

A high level of naivete here don't you think? Penalize investment capital which is what the left is fawned of doing then reap the rewards IMHO. Build rental for what purpose a 5% return along with the horrendous issues associated with doing so? I doubt there has been a rental property built in my area for 10 years.  

[JM_]

1 hour ago, Boudrias said:

A high level of naivete here don't you think? Penalize investment capital which is what the left is fawned of doing then reap the rewards IMHO. Build rental for what purpose a 5% return along with the horrendous issues associated with doing so? I doubt there has been a rental property built in my area for 10 years.  

large purpose built high rises for rental is a pretty good business. Individual owners renting out a home or single apartment are getting screwed all over with some pretty horrific stories of people refusing to pay their rent or leave.

 

But you avoid all of this with co-ops. It worked extremely well in False Creek, and won't hurt equity for regular home owners. 

[Elias Pettersson]

2 hours ago, Boudrias said:

A high level of naivete here don't you think? Penalize investment capital which is what the left is fawned of doing then reap the rewards IMHO. Build rental for what purpose a 5% return along with the horrendous issues associated with doing so? I doubt there has been a rental property built in my area for 10 years.  

The problem is either you penalize investment capital or people have nowhere to live.  This is a government created problem which needs to be fixed ASAP or else the current and future generations won't be able to afford to buy a home.

 

Obviously, stopping people from buying more than one property is not going to work well and I can't see any government, including the NDP, making that decision.  Same with increasing capital gains taxes.  Only way out of this mess is for local governments to eliminate all of the red tape, increase density all across the lower mainland, shorten the time it takes to build new homes, and open up some of the ALR.

 

Rental properties are being built all across Metro Vancouver.  Some developers are building them as part of their new community build projects, especially around skytrain stations.  Give these developers more density to build more units and they can put up a rental property in the same community.  The Aquilini's did it right at Rogers Arena, but the city gave up all of the extra perks the Aquilini's were going to do around the area because they didn't build units they could sell off.  If developers don't want to build these rentals then the government should step in and fund it themselves.

[JM_]

11 minutes ago, Elias Pettersson said:

The problem is either you penalize investment capital or people have nowhere to live.  This is a government created problem which needs to be fixed ASAP or else the current and future generations won't be able to afford to buy a home.

 

Obviously, stopping people from buying more than one property is not going to work well and I can't see any government, including the NDP, making that decision.  Same with increasing capital gains taxes.  Only way out of this mess is for local governments to eliminate all of the red tape, increase density all across the lower mainland, shorten the time it takes to build new homes, and open up some of the ALR.

 

Rental properties are being built all across Metro Vancouver.  Some developers are building them as part of their new community build projects, especially around skytrain stations.  Give these developers more density to build more units and they can put up a rental property in the same community.  The Aquilini's did it right at Rogers Arena, but the city gave up all of the extra perks the Aquilini's were going to do around the area because they didn't build units they could sell off.  If developers don't want to build these rentals then the government should step in and fund it themselves.

maybe with Kennedy Stewart turfed this can start to happen in Vancouver. Working with developers has to be viewed as a big part of the solution. Unfortunately the NDP can't seem to grasp this. 

 

[Elias Pettersson]

1 minute ago, JM_ said:

maybe with Kennedy Stewart turfed this can start to happen in Vancouver. Working with developers has to be viewed as a big part of the solution. Unfortunately the NDP can't seem to grasp this. 

 

That is my hope Jim.  Ken Sim needs to get to work fast.  This stuff needed to happen yesterday...

[JM_]

5 minutes ago, Elias Pettersson said:

That is my hope Jim.  Ken Sim needs to get to work fast.  This stuff needed to happen yesterday...

I keep coming back to the false creek area since I lived there for 5 years. The section between Yaletown and Chinatown has been undeveloped for far too long. No reason for it at all.

 

Same with the area between Cambie Bridge and the Olympic Village. Turn all of that into 10,000 co-op spaces for younger folks like @Coconuts. 

 

There's literally nothing lost for the city to do that. The land that Vancouver owns is still city owned assets, they get to collect taxes from 10,000 new owners, and we get to keep some folks living in town.

 

The city would have to grant the current non-city owned land holders some kind of carrot, but so what? but this is always where the NDP comes in whining about "liberal friends" and other horse poop. What matters most is we get affordable homes for people, now. 

 

Edited November 3, 2022 by JM_

[taxi]

On 11/2/2022 at 12:09 AM, Elias Pettersson said:

My buddy told me that the market is in complete freefall right now.  Sales are down 45% this October from last October.  Properties are sitting on the market unsold, no offers, no showings.  The only stuff that is selling are the properties that are well priced and below market prices.  With one more rate increase in December it could get ugly in 2023.  Buyers now need to qualify for a mortgage at 7.5%.  That could go up to 8% in the new year.  Imagine trying to qualify for a $600-700k mortgage at 8%?  Cash is king but people with cash aren't going to buy in this market.  You are better off just saving the money in the bank for now and getting 5-6% interest until this market turns around...

Sales are down. Prices are not. This happens in Vancouver a lot. When sales are down, people just don't sell and it's only those that absolutely need to sell that will.

 

There have been some decreases in price, especially as you get further out from the downtown core, However, any decrease in prices is being far outpaced by increases in mortgage rates. Affordability is unlikely to improve IMO. Also increases in rent are giving existing owners less incentive to sell. 

 

Anyways, my point is that I disagree with anyone who thinks the current market, economy, inflation, and interest rates will be good for people struggling to afford homes.

[Elias Pettersson]

12 minutes ago, taxi said:

Sales are down. Prices are not. This happens in Vancouver a lot. When sales are down, people just don't sell and it's only those that absolutely need to sell that will.

 

There have been some decreases in price, especially as you get further out from the downtown core, However, any decrease in prices is being far outpaced by increases in mortgage rates. Affordability is unlikely to improve IMO. Also increases in rent are giving existing owners less incentive to sell. 

 

Anyways, my point is that I disagree with anyone who thinks the current market, economy, inflation, and interest rates will be good for people struggling to afford homes.

For sure. I agree. Even if prices drop 20% most people still won’t be able to afford a detached home in the city. The market would have to collapse and we would need to see a 50% drop in prices or more to have a major affect on affordability. 
 

This was from my friend today:

 

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,148,900. This represents a 2.1 per cent increase from October 2021, a 9.2 per cent decrease over the last six months, and a 0.6 per cent decrease compared to September 2022.

 

So prices are down overall 9% just in the last 6 months. I can see this continuing into 2023. Might help with people who want to purchase in the suburbs. A 20% drop for a house or condo in Surrey or Maple Ridge may help some get into the market. 

[taxi]

7 hours ago, Elias Pettersson said:

For sure. I agree. Even if prices drop 20% most people still won’t be able to afford a detached home in the city. The market would have to collapse and we would need to see a 50% drop in prices or more to have a major affect on affordability. 
 

This was from my friend today:

 

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,148,900. This represents a 2.1 per cent increase from October 2021, a 9.2 per cent decrease over the last six months, and a 0.6 per cent decrease compared to September 2022.

 

So prices are down overall 9% just in the last 6 months. I can see this continuing into 2023. Might help with people who want to purchase in the suburbs. A 20% drop for a house or condo in Surrey or Maple Ridge may help some get into the market. 

The suburbs are definitely dropping more than in Vancouver proper. The problem with buying a condo in the suburbs are that generally people who do that are going to be on more limited incomes and more likely to be affected by the increased mortgage rates.

[bishopshodan]

Holy crap.

 

Nevermind buying, I feel for those trying to rent. Insane. 

 

https://dailyhive.com/vancouver/north-vancouver-rent

North Vancouver just became Canada's most expensive city to rent

“Metro Vancouver’s average rent price for an unfurnished, one-bedroom unit has risen sharply, up to $2,317 this November,” liv.rent told Daily Hive.

[Gurn]

15 minutes ago, bishopshodan said:

up to $2,317 this November,” liv.rent told Daily Hive.

$70. a month higher than my net pension. And I was a former so called 'over paid government worker'

[HI5]

I’ve looked at 6 condo assignment contracts this week, and they’re all non-residents trying to flip presales for profit. 

[bishopshodan]

I'm not sure removing all strata restrictions is a good thing. Maybe I'm not looking at all the angles.

 

I feel that there will be now more opportunity for speculators. 

I lived in a 75% owner occupied building. Had a min 2 year wait list to rent out. This restriction made the unit values about 10% less than the market as anyone buying had to move into the suite. 

So, I used to think that was a good thing for people trying to get into the market as the prices were a bit lower. Also, owner occupied buildings often are maintained better. The strata council usually all live in the building, they are mirco managing their actual homes....it's not just an investment property. My building was pristine and had a huge contingency fund.

 

https://globalnews.ca/news/9294622/bc-government-housing-supply-issues-affordability/

[4petesake]

Ban on foreign buyers will take effect Jan 1/23 and the BC Land Ownership Transparency Act filings are due Nov 30.

Links in comments.

 

 

 

[Ghostsof1915]

On 11/22/2022 at 5:29 PM, bishopshodan said:

I'm not sure removing all strata restrictions is a good thing. Maybe I'm not looking at all the angles.

 

I feel that there will be now more opportunity for speculators. 

I lived in a 75% owner occupied building. Had a min 2 year wait list to rent out. This restriction made the unit values about 10% less than the market as anyone buying had to move into the suite. 

So, I used to think that was a good thing for people trying to get into the market as the prices were a bit lower. Also, owner occupied buildings often are maintained better. The strata council usually all live in the building, they are mirco managing their actual homes....it's not just an investment property. My building was pristine and had a huge contingency fund.

 

https://globalnews.ca/news/9294622/bc-government-housing-supply-issues-affordability/

No, just think now you'll see suites that are 450 sq. ft. going for $2000+ per month. 

How about more housing co-ops. So that for every project, there has to be a 10% ratio of building coop housing? The way city homes are popping up. That might be an idea? 

 

[Elias Pettersson]

1 hour ago, Ghostsof1915 said:

No, just think now you'll see suites that are 450 sq. ft. going for $2000+ per month. 

How about more housing co-ops. So that for every project, there has to be a 10% ratio of building coop housing? The way city homes are popping up. That might be an idea? 

 

You can rent out a fully furnished 500sf 1 bedroom condo with a small den in downtown Vancouver for just under $3,000 per month...

[bishopshodan]

I think things start turning around by spring.

Frustrating times for those trying to get into the market. I don't think this major correction will be very big for us in BC after all. 

https://vancouversun.com/real-estate/mortgages/housing-market-too-soon-celebrate-recovery/wcm/f85b8013-2d7d-4ad6-9963-07929e86f0b7

[taxi]

On 11/28/2022 at 8:39 AM, bishopshodan said:

I think things start turning around by spring.

Frustrating times for those trying to get into the market. I don't think this major correction will be very big for us in BC after all. 

https://vancouversun.com/real-estate/mortgages/housing-market-too-soon-celebrate-recovery/wcm/f85b8013-2d7d-4ad6-9963-07929e86f0b7

Unfortunately, the present conditions are only likely to further exacerbate affordability issues. Inflation, higher costs of living, higher mortgage rates, rising rents/Air BnB fees (more incentive for investors), a rising population, foreign investors fleeing China/Russia etc....