B.C. housing fix no more than a knee-jerk muddle

Dermod Travis
The Province

It takes a certain skill set to try and fix a problem and possibly botch it up even more, but the B.C. government is certainly testing the idea as it flails about hoping to cool Vancouver’s red-hot housing market.

For months the government had been in denial over the issue: overblown, isolated to a few neighbourhoods, it said.

Since then its approach has gone from “the market will correct itself,” to a “bold action plan,” to legislating a retroactive 15 per cent tax on foreign ownership.

Along the way, the government bought time by setting up a panel to investigate allegations of questionable practices in the real estate industry and retaining the Conference Board of Canada “to conduct a research study on housing affordability.”

It did seem impatient, though. In a few areas under review, the government acted first, final reports be damned.

It muddied the waters in early July by releasing 19 days of data on foreign home ownership transactions.

Finance Minister Mike de Jong was left flat-footed when asked why he didn’t wait a day or two to include transactions from June 30, when a significant number of home sales would have closed.

Despite cautions over the data, it didn’t stop the self-interested from embracing the numbers, “see, no problem.”

Then two weeks ago a new data set. There may be a problem after all.

The self-interested switched tack fast.

Suddenly five weeks of data was insufficient to form any real conclusions, even though the caveat-laden 19-day data set had been just fine.

It left more than a few pundits dizzy.

The only person who may not have been surprised by the twists and turns was Vision Vancouver and B.C. Liberal party bagman Bob Rennie.

Rennie holds the distinction for setting B.C.’s record for the most expensive political fundraising lunch at $25,000 a plate for Vancouver mayor Gregor Robertson’s 2014 re-election campaign.

In a July interview with the Globe and Mail, Rennie claimed to have known about the impending tax three weeks before legislation was tabled. That statement didn’t go over so well with his developer buddies or government pals. It was backtracked quickly to an “educated guess.”

For someone who was quite vocal on the issue in June, the media-savvy Rennie was uncharacteristically quiet in July, particularly given his educated guess and the means available to him to raise the alarm.

While most of the government’s effort has focused on home prices, it’s not all about flipping, buying and selling.

A lot of the debate surrounds what the government means by affordable.

Some of the one-bedroom units in Victoria’s “affordable rental-housing” project – the Azzurro – will go for $950 per month.

The average rent for a two-bedroom apartment in Metro Vancouver is $1,410. In Sudbury, Ont., the average is $953, a difference of $5,484 per year.

Why a comparison with Sudbury?

Out of 28 census metropolitan areas, Sudbury had a higher median family income in 2014 than Victoria, Vancouver and Abbotsford-Mission.

The difference with Vancouver was $11,410.

Many may be under the mistaken impression that the government is building far more affordable housing than it actually is, given the plethora of news releases that accompany each project.

There’s the announcement of a housing program, followed by expressions of interest sought, then the successful sought seeker selected release, project and price tag announced, project breaks ground, project opens and, for some, project celebrates one-year anniversary.

A problem 30 years in the making doesn’t get solved on the fly, and that’s part of the problem with the government’s recent initiatives.

You don’t get the sense of a comprehensive housing policy, but a mishmash of knee-jerk reactions.

Case in point? The tax on foreign ownership.

Compliance with Canada’s obligations under NAFTA, Charter issues, scuttled home purchases have been raised as potential risks.

There are possible workarounds. One real estate agent has already advertised the 15 per cent equivalent to “We pay the GST” sales.

The biggest worry, however, may be its regional nature. The tax may simply push the problem down the road.

It seems Prime Minister Justin Trudeau’s warning – following a Vancouver housing roundtable in June – fell on deaf ears: “There’s no question that concerted, thoughtful effort is going to be needed to address the situation but we have to be very wary of unintended consequences.”

© 2016 Postmedia Network Inc.

Single-level living a big draw at the Residences at Gateway

Mary Frances Hill
The Province

Project: Residences at Gateway

Residence sizes and prices: 1 bed + flex to 2-bed+den, 703 – 1,238 sq. ft.

Price: From the mid $200,000s

Developer and builder: Boulevard Group

Sales centre: 101 – 2031 McCallum Road, Abbotsford

Hours: noon — 5 p.m., closed Tuesdays

Website: boulevardgroup.ca

Phone: 1-604-855-8116

With a layout that is practical, efficient and above all, simple, interior designer Farrah Hague and the Boulevard Group make a strong case for single-level living for downsizers at The Residences at Gateway, the developer’s new condominium community in Abbotsford.

It’s probably no surprise that downsizers are being attracted to the project. As homeowners who seek smaller living quarters after living in homes that have perhaps become too large to manage, they’re often willing to sacrifice space. Yet they still need ample room to store their treasured belongings in an efficient space that has easy access to plenty of storage.

“We believe single-level living is optimal from a design standpoint; no more running upstairs to fetch a forgotten item, or lugging your laundry hamper down two flights of stairs and then back up again,” says Hague, the in-house designer for Boulevard Group. Single-level homes allow homeowners “to utilize every room in multiple ways and fully enjoy the ease of the design,” she adds.

At Residences at Gateway, storage space is directly next to parking spots, and additional storage is provided courtesy of the kitchen pantries.

Hague has fashioned the living room as a warm hub for socializing; her choices of furnishings betray her tastes for a mid-century modern flair. At the same time, she manages to maintain a contemporary ”lightweight” look to the room, as she describes it.

“While mid-century modern is very trendy right now, we wanted to avoid pieces that would make this feel like a time capsule.  The layout lean lines and finishes in the suites lend to a very versatile decor. Whether our owners prefer something more traditional and European or trendy and modern, they will be able to decorate with ease.”

A bathroom, meanwhile, shows her knack for balancing brightness (note the generous use of striated marble in the shower stall) with the warm and moody dark green wall and dark wooden cabinetry.

Hague says the Boulevard Group team chose Carrara marble because of its classical beauty, and the way it adds “a touch of timeless luxury to any space.” Marble also contrasts with the warmer texture of bath vanities, wood floor and custom millwork.

“We chose these materials to highlight the interplay between light and dark and to provide a cosy but fresh backdrop for any furnishings,” says Hague.

The kitchen includes plenty of storage in the island and the dining room is placed close to the outside deck—a nice touch in a layout suited to family gatherings, Hague says.

“Let’s face it: nobody likes to bring a tray of food through the living room to get to the barbecue.”

© 2016 Postmedia Network Inc.

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Residential unit sales fell 3.4% in July

Justin da Rosa
REP

Recent statistics point to a slight sales slowdown within the country’s westernmost province.

Residential unit sales in British Columbia fell 3.4% year-over-year in July, according to the British Columbia Real Estate Association. A total of 9,900 homes were sold last month.

“Housing demand has moderated in many regions of the province, after setting records earlier in the year,” Cameron Muir, BCREA Chief Economist, said. “The less frenetic pace of home sales will likely provide a much needed boost to the inventory of homes for sale. The rate of home price appreciation is also expected to slow from the unsustainable level exhibited this spring.”

However, total sales dollar volume — $6.57 billion — was up 5.4% year-over-year.

The average price of $663,411 was also up, spiking 9.1% year-over-year.

“Year-to-date, BC residential sales dollar volume increased 45.5 per cent to $56.5 billion, when compared with the same period in 2015,” the association said in a release. “Residential unit sales climbed by 25 per cent to 77,261 units, while the average MLS® residential price was up 16.4 per cent to $731,189.”

 Copyright © 2016 Key Media Pty Ltd

Vancouver Home Project ? connecting sellers with buyers

Justin da Rosa
Canadian Real Estate Wealth

Despite being met with some criticism, the Vancouver Home Project – which aims to connect Vancouver homeowners willing to sell at below market value with potential buyers – seems to be gaining steam.

In an update from the Project, it seems a number of sellers are willing to let their homes go for less than market value.

“I’m an owner who has decided to sell to the most fantastic buyers, but to ensure they would get the home I’ve done a private deal. No bidding wars, no real estate agent fees for little or no work and the right people get the home,” one potential seller said, per the Vancouver Home Project’s website. “It’s possible to achieve a ‘profitable’ price when taking into account one isn’t paying agent fees and assessing the percentages that homes are selling for over asking … add a little for market forces, deduct a little for agent fees and everybody wins.”

In some cases, however, investors are losing out.

“My husband and I just sold our home and took 25K less than the highest offer. We opted to maintain the stability of the neighbourhood,” another seller said. “Our son, daughter in law and two granddaughters also live in the area. An investor presented the highest offer, but my husband and I opted to take a lower amount from a lovely young couple instead.”

The project was launched in May of this year with the intention of improving affordability by appealing to sellers’ altruism.

“I think she’s kind of sick of the frenzy that’s going on in the city,” David Kandestin, a corporate lawyer and the man behind the project, told CREW sister publication, MortgageBrokerNews.ca, at the time. “She has conditions; she wants it to be sold to a family with kids, she wants some certain mechanisms to be put in there so that they can’t just turn around and flip it the next day or the next week or whenever.”

Copyright © 2016 Key Media Pty Ltd

Stratas poised to disband and sell off condo buildings

JOANNE LEE-YOUNG
The Vancouver Sun

Some two dozen stratas across Metro Vancouver are positioning themselves to dissolve and sell their entire buildings to developers, according to Tony Gioventu, executive director and strata property adviser for the Condominium Home Owners’ Association of B.C.

“In the next months, stratas will be starting to act,” said Gioventu, adding the rough estimate of numbers is based on his organization’s dealings with law offices and commercial brokers. “We know of 25 stratas looking at liquidation. (Most) of them are within two blocks of a SkyTrain station.”

In recent years, many single-family homeowners, especially those who live around designated arterials, have reaped the benefits of real estate deals known as “land assemblies.” This is where several neighbouring homes sold together as a parcel can be worth double or more to a developer looking to build higher-density condo and townhome projects.

Now, more owners of multi-family units stand to cash in after a fresh piece of legislation came into effect two weeks ago. 

Just as with single-family homes that are prime fodder for land assemblies, some of these condo and townhome buildings are older and in need of repairs that could be costly for stratas. In some cases, special levies of between $50,000 to $100,000 per unit could be in store for major upgrades. But, if owners group together to sell an entire building to a developer looking to build a much higher-density project, they could see selling prices that are between one-and-a-half to three times their ordinary market value, said Gioventu. 

“So a unit that might go for $325,000 could go for as much as $975,000.”

He said buildings in areas targeted for high-density development are the most obvious ones having these conversations. He named zones surrounding SkyTrain stations at Brentwood, Metrotown and Lougheed Mall in Burnaby. There are some in the Lonsdale Quay area, as well as near the SkyTrain station in New Westminster.

“The buildings are generally in a six-block radius of these stations,” he said.

For the hundreds of strata-titled buildings in B.C., a recent change in provincial legislation means that instead of needing 100-per-cent agreement among owners, councils will only need an 80-per-cent vote to disband.

It’s a change that puts B.C.’s rules about joint housing ownership more in line with other provinces, and might make it easier for stratas to push holdout owners into selling and deals to close more quickly.

It used to be that if stratas couldn’t get 100 per cent of the votes to disband and sell, the owners in favour would have to go to court and try to get a legal order in an often long and expensive process.

Now, stratas with an 80-per-cent vote will still have to apply to court within 60 days for a sale order. However, it is more of a “second sober thought” process that is designed to prevent a “developer (coming in to) buy up 81 per cent of the units at a low price,” said Gioventu.

 

Once a strata decides to engage a broker and begin marketing, the process could take approximately eight to 10 months to get a sale and close, he estimates.

This is possible, but it can also take longer, according to Peter Roberts, a Lawson Lundell lawyer who has worked with condo owners to sell entire buildings to developers, including the only recent case of a completed deal, which happened in May of a 21-unit building in Coquitlam.

His “strata wind-up group” has been busy in recent months with queries from dozens of groups of owners. A combination of rising property prices, looming repair costs and this new legislation — which says “a lack of unanimity isn’t going to hamper a sale” — has sparked “a greater willingness toward extracting value” from their units, said Roberts. 

At first glance, the new legislation might make it seem like it will now be a breeze for a group of owners who want to sell to push through opposition from holdout owners who don’t. However, Roberts said it will still depend on what’s behind the resistance.

“Is it an owner saying, ‘I don’t like this price’? Or someone feeling like, ‘This has been my home for 80 years, my doctor is next door’? There is a difference.”

Groups that want to sell need to be “organized from day one” in order for a sale to happen as quickly as possible, he said. Not getting caught by technicalities is of the essence because once strata minutes show there is a desire to sell an entire building, the market appeal of each unit as an individual sale changes. Asked Roberts: “Who will buy into a development knowing that it’s headed for redevelopment, unless there are buyers looking for a quick profit?”

Bigger picture, there will be some impactful, “unintended consequences” for the market as more stratas seek to dissolve and sell, according to Gioventu.

“The funny little anomaly of this is that, say, a 100-unit townhome complex unit liquidates. (All of a sudden) you will have 100 owners with up to $1 million in their pockets fighting to find a new place to live. Even if only half look to buy in the same area … you will have a significant buying wave. It’s the next housing wave.”

© 2016 Postmedia Network Inc.

Prospective buyers are making calls about criticized Point Grey home

MATT ROBINSON
The Vancouver Sun

When you go into a restaurant, there’s chicken, there’s beef, there’s fish. “It’s a good thing we don’t all like the same thing.”

That’s the take of Loren Dunsworth, the Los Angeles-based realtor selling a cube-shaped Point Grey home that has drawn dirty looks and disparaging comments in recent weeks.

“Monstrosity,” “budgie breeding box,” “ugly” and “hideous” are among the descriptions some readers have come up with for the home at 3691 Point Grey Rd. in Vancouver. 

But in the end, the design needs to appeal to just one buyer — the person who Dunsworth estimates will pay between $8.5 million and $10 million to own the 2,280-sq.-ft., two-bedroom home. 

“It’s not going to be a house for everybody, absolutely not. But it’s going to be very, very well done, and I think it’s an art piece,” Dunsworth said in an interview on Monday.

“I was a little surprised by everyone saying what a horrible house it was. Clearly these people haven’t driven around Vancouver too much. I’ve seen some houses up there that seem like (an) afterthought, with pillars and black marble. … Those houses, to me, seem much more in line for the ‘ugliest house in Vancouver’ than this one.”

Dunsworth has already received calls from prospective buyers for the Point Grey home, which was designed by Vancouver-based architect Tony Robins. Among the callers was someone who had previously lived in a home designed by Robins. The caller told Dunsworth that home had caused “an equal amount of stir” when it was being built.

Robins lists on his CV scores of homes and non-residential buildings across Canada and the world. Included among them is the Boathouse Restaurant at Kitsilano Beach.

Dunsworth, who is licensed in Los Angeles and Vancouver and works with Rennie and Associates Realty, said that the eventual buyer would likely be a fan of Robins’ work. When the project is finished — and no longer surrounded by construction equipment — it will be beautiful, she said.

“The landscaping around this house is going to be stunning. They’re doing some very serene, Japanese landscaping. There’s going to be a reflection pond all the way around the house,” she said.

“If everybody could just relax and wait and see the end result, I guarantee that people will be turned around on this house.”

The assessed value of the property is $4 million (up from $2.8 million the year before). It is on a corner lot across from Hastings Mill Park near the Royal Vancouver Yacht Club. While the home is not waterfront, it has an ocean view.

When asked how she planned to market the home, Dunsworth said with a laugh: “Apparently this home is going to market itself,” noting the media attention it has garnered.

Dunsworth said “time would tell” whether the province’s new 15-per-cent foreign buyers’ tax (amounting to $1.5 million on a $10-million home) would impact the sale of the home.

“A lot of the foreign buyers don’t like taxes, (but) a lot of the foreign buyers aren’t going to care about that.”

© 2016 Postmedia Network Inc.