Stephanie Ip
The Vancouver Sun

A judge has ruled that the sale of a Vancouver West End assembly can proceed despite two holdout owners who believed the sale price was too low and that they were not kept informed during the sale process.

Barclay Terrace is a 36-unit concrete complex built in 1992 and located at 1075 Barclay St. in Vancouver’s West End.

Of the 36 units in the building, 34 belong to two corporations, Barclay Thurlow Property Inc. (BTPI) and Shepstone Investments Inc., referred to as the majority owners.  BTPI is affiliated with Westbank Corporation and Shepstone with Bosa Properties Ltd.

The units had been gradually purchased by the companies from individual owners with the goal of winding up the strata corporation and selling the property for redevelopment.

According to B.C. strata bylaws, owners can force a sale if 80 per cent agree; with 34 of the 36 units in hand, BTPI and Shepstone owned 94 per cent of the strata vote.

An adjacent complex of four two-storey townhomes was also bought by Shepstone to be sold as part of the assembly.

The remaining two units at Barclay Terrace belong to Grace and Lisa Francescato and Ramin Malekmohammadi Nouri, referred to as the minority owners in court documents.

The Francescatos had been in discussions to sell their suite to the majority owners in 2016 for $1.9 million, but the sale fell through after the Francescatos raised their price to $2.1 million and then changed their minds.

Nouri had been contacted by the majority owners in 2015 and 2016 to sell his unit but he refused on both occasions. In early 2017, BTPI offered Nouri $3.5 million to sell and said they were “prepared to offer more.”

“According to … the realtor engaged by BTPI to negotiate with Mr. Nouri, Mr. Nouri said his price was $10 million,” read court documents. When told the “figure was absurd” but that a counteroffer would be entertained, Nouri lowered his price to $9.75 million. The negotiations ceased.

After a purchase offer for the complex was made by Grand World Holdings Ltd. in June 2017 for a price of $105 million, the majority owners applied to the court to confirm its resolution to wind down the strata and proceed with the sale. They also notified the holdout owners of the deal struck, and informed the Francescatos they would receive $2.7 million and Nouri $2.2 million as part of the sale.

The minority owners, however, opposed the application based on their beliefs that they weren’t adequately consulted during the sale process and that the sale price is too low.

In his decision dated March 13, 2018, Justice Warren B. Milman ruled that the minority owners were as informed as could be since the majority owners were required to keep the details of the sale agreement confidential. Milman also said the holdout owners had fair warning as to what the future was likely to hold for Barclay Terrace.

“The minority owners were not taken by surprise by what occurred,” wrote Milman. “They were able to see the writing on the wall by late 2015 or early 2016, when the majority owners sought and then acquired a controlling block in pursuit of their patent agenda to redevelop the property.

“At that point, a dissolution and sale of Barclay Terrace was all but inevitable (and, in the case of the Francescatos at least, initially welcomed).”

As for the sale price, the judge noted that the assessed value – which the minority owners suggest is closer to $150 million – is based on the assumption that all 36 units and the adjacent townhomes are sold as a controlling block under one owner. He also rejected the notion that the minority owners were being unfairly treated or that the sale price was prejudiced against them.

“In the end, the minority owners are to receive enormous premiums over the 2017 assessed values of their units as a result of the efforts of the majority owners in marshalling the combined properties for sale as an assemblage,” he wrote.

“The Francescatos are to receive $2,677,500 for a unit assessed at $793,000 and Mr. Nouri is to receive $2.2 million for a unit assessed at $672,000.”

Milman then granted the majority owners’ application to wind down the strata and sell off the property.

© 2018 Postmedia Network Inc.

Steve Randall
Canadian Real Estate Wealth

The new mortgage rules that came into effect at the start of 2018 are having an impact on the market in British Columbia.

The BCREA says that 6,206 homes were sold through the MLS in February, down 5.7% year-over-year, while prices were up 8.8% to an average $748,327.

“More stringent mortgage qualification rules for conventional borrowers are dampening housing demand in the province,” said Cameron Muir, BCREA Chief Economist. “Since the new rules came into effect, BC home sales have fallen more than 26%, on a seasonally adjusted basis.”

Year-to-date, BC residential sales dollar volume was up 15.9% to $8.47 billion, compared with the same period in 2017. Residential unit sales increased 4.1% to 11,516 units, while the average MLS residential price was up 11.3% to $735,755.

The association says that previous tightening of mortgage rules has led to a softer market for around 4 to 7 months with the third month typically showing the largest impact.

Copyright © 2018 Key Media Pty Ltd

by Dirk Meissner
Canadian Real Estate Wealth

Communities across British Columbia are speaking out against the province’s proposed speculation tax on real estate, saying the levy could damage their economies.

The Regional District of Nanaimo joined West Kelowna on Wednesday in asking the NDP government to rethink the tax, introduced in last month’s budget.

West Kelowna council voted unanimously to seek an exemption from the proposed tax covering the entire community of 35,000 people in the Okanagan.

The Nanaimo Regional District board, representing much of central Vancouver Island, also voted unanimously to “object to the speculation tax in any form, in any region or municipality in B.C.

Board members asked for a meeting with Finance Minister Carole James to discuss the tax and they invited the mayors of Nanaimo, Parksville, Qualicum Beach and Lantzville to attend.

In a statement Wednesday, board chairman Bill Veenhof said there are deep concerns about the potential impact of the tax on people who own vacation properties in the Nanaimo area.

“These people are not speculators,” the statement says. “They are important members of our communities. Families who visit year after year, supporting local businesses, paying their fair share of property taxes, and investing in our tourism-based economy.”

West Kelowna Mayor Doug Findlater said his community includes a large population of part-time residents and he fears there could be a real estate crisis if people decide to sell rather than pay the levy.

He said there are already signs developers are hitting pause on local projects.

“Suddenly, the development market is freezing up,” Findlater said in an interview. “The banks are not loaning and some developers are being caught in this already. I’m aware of that. Other developers who haven’t built are just putting it all on hold and just waiting for the air to clear.”

James said she is reviewing the tax, which would cost some homeowners $5 for every $1,000 of their property’s assessed value this year and increase to $20 for every $1,000 of assessed value in 2019.

“I want to stay focused on the reason we’re doing this, which is for affordability,” she said. “When you have in Kelowna a 0.2 per cent vacancy rate, that causes all kinds of problems.”

The speculation tax would apply to properties owned by people who do not pay income tax in B.C. in a bid to improve housing affordability and moderate the real estate market. But many B.C. residents with vacation properties are saying government policy offering income tax credits to offset potential tax increases does not go far enough.

Copyright © 2018 Key Media Pty Ltd

Canadian Real Estate Wealth

Canadian home sales fell 16.9 per cent in February, while the national average sale price dropped five per cent, compared to a year earlier.

New monthly numbers from the Canadian Real Estate Association also show that national home sales declined 6.5 per cent from January to February, the second consecutive monthly decline and the lowest reading in nearly five years.

Sales were down in almost three quarters of all local housing markets, but there were large monthly drops in the Greater Vancouver and Greater Toronto areas, CREA says.

These declines confirm that many homebuyers moved their purchase decisions forward to late 2017, in a bid to secure mortgages before tighter lending rules took effect in January, said Gregory Klump, CREA’s chief economist.

The national average house price for homes sold in February 2018 was just over $494,000, down five per cent from a year earlier.

But excluding Toronto and Vancouver, the country’s most active and most expensive markets, the national average price was just under $382,000, up 3.3 per cent from $369,728 a year ago. 

The Canadian Press

Copyright © 2018 Key Media Pty Ltd

New mortgage rules cited as B.C. sales slide

The Vancouver Sun

The British Columbia Real Estate Association says tough mortgage qualification rules are a key reason for a province wide drop in housing demand last month compared with February 2017.

The association says home sales fell 5.7 per cent in February, with about 6,200 properties changing hands.

Chief economist Cameron Muir says on a seasonally adjusted basis, sales have plummeted more than 26 per cent since new federal mortgage rules took effect at the beginning of the year.

But the association says prices continue to climb, with the average home selling for just over $748,000, an 8.8 per cent jump over February of last year.

The Office of the Superintendent of Financial Institutions implemented new lending guidelines in January that require borrowers who don’t need mortgage insurance to show they would still be able to make payments if interest rates rise.

In order to get insurance, homebuyers must prove they can service their uninsured mortgage at a qualifying rate two percentage points higher than the lender’s rate or the Bank of Canada’s five-year benchmark rate, currently set at 5.14 per cent.

© 2018 Postmedia Network Inc.

Fairways showcases touches of glam

Mary Frances Hill
The Province

Fairways

What: A boutique-style development of 22 townhomes in four wood-frame buildings backing on to Peace Portal Golf Course

Where: 303 – 171 St., Surrey

Residence sizes and prices: Four-bedroom, three-level homes ranging to 2,110 sq. ft.; from $769,990 (Three-bedroom homes have sold out.)

Developer and builder: Zenterra Developments Ltd.

Sales centre: 2280 163 St., Surrey

Hours: noon — 5 p.m., daily

At Fairways, Zenterra’s planned community of townhomes overlooking Surrey’s Peace Portal Golf Course, designer Gene Guindon had fun with creative pairings of contrasting materials as he embraced the return of luxury and glamour.

Guindon likes to flex his design muscle by mixing and matching, incorporating materials one would find among modern decor into a more conservative setting. Velvet, which injects a touch of luxury into spaces populated by harder materials like tables and countertops, is one such element.
“​Velvet is back at the right time,” says Guindon. “The design industry has definitely headed back to adding a little more luxury and glam.”
He notes that the return to super soft materials in home accents around the home was inevitable after the popularity of mid-century and industrial design took hold.

“There were the years when industrial and mid-century [design] was popular,” he says, and it was just a natural progression to swing back to adding some softer touches.

“This doesn’t mean industrial and mid-century are cold and out of fashion. You’ll still be seeing mid-century pieces and shapes, but pairing with velvet-covered upholstery is a perfect way to soften up an industrial end table or mid-century dining table.”
One show home features a peacock velvet Madeleine bed set against gold-spattered wallpaper, “again, pulling in that luxury touch, but not overdoing it,” Guindon says.

The hard surfaces of the kitchen provided a perfect spot for Guindon to add more velvet. He used a smoky navy blue velvet on counter stools. “They are wonderful against the stone counter and grey kitchen cabinets — a classic colour combination.”

Going glam came easy for Guindon, who says he has a preference for coupling warm materials with durable solids — like the gold and navy blue, and peacock and gold colour combinations against grey flooring, white stone and grey cabinetry in the kitchens and bathrooms.
“I have to say my favourite element used, would be the combinations of navy blue and gold and the peacock and gold.”

Guindon says he felt free to be creative and daring with materials, thanks to his guiding companion at Zenterra.

He works closely with Zenterra’s sales manager Bryanna Christopherson, who shares feedback from homebuyers. “We really try to keep [improving] each project. A lot of thinking goes into the small details.”

© 2018 Postmedia Network Inc.

Kerrisa Wilson
other

BC home sales saw an annual decline in February and — like much of the rest of the country — stricter mortgage regulations appear to be to blame for the drop.

Last month, a total of 6,206 homes changed hands in the province, down 5.7 per cent from February 2017, according to the latest data from the British Columbia Real Estate Association (BCREA), published today.

With the introduction of a new mortgage stress test on January 1, BCREA Chief Economist Cameron Muir says more stringent mortgage qualification rules are dampening housing demand across the province.

“If we look at February compared to December, sales were down about 26 per cent on a seasonally adjusted basis,” Muir tells BuzzBuzzNews.

Muir attributes the drop in sales to unusually strong activity in December before the new rules came into effect. And because eroding affordability has been easing demand, and reduced purchasing power for many households.

The province continues to face tight supply, with 22,633 active listings in February, a 5.5 per cent drop from a year ago.

Limited supply was met with strong demand last month, resulting in an increase in home prices, says Muir. The average price of a home in BC was $748,327 in February, up 8.8 per cent from the previous year.

“Most regions in the southern half of the province are at or near 10-year lows in terms of supply and that has been quite persistent. As a result we’re continuing to see upward pressure on prices, as homebuyers compete with one another for the available product in the marketplace,” says Muir.

In Greater Vancouver, the average price of a home was $1,063,494 in February, a 6.8 per cent increase from $995,583 a year ago.

Muir says Greater Vancouver’s market remains in sellers’ territory with a sales-to-active listings ratio of 26.6 per cent, compared to 30 per cent in February 2017.

“The detached market is more or less in balance, whereas when we get into the multi-family market — whether it be townhouses or apartments — they are firmly in sellers’ market territory,” says Muir.

“We see prices climbing at rates of 25 per cent to 30 per cent year-over-year growth in the apartment market in Metro Vancouver region,” he adds.

Last month, the Fraser Valley region saw the largest annual gain in price growth out of all regions recorded. The average price of a home was $761,446, a nearly 23 per cent increase from $619,792 in February 2017.

According to Muir, the region is in strong sellers’ territory with a sales-to-active listings ratio of roughly 41 per cent.

“Even in the face of some more tepid demand, we’re continuing to see prices rise as there simply isn’t enough product out there to satiate demand,” says the economist.

© 2017 BuzzBuzzHome Corp.

BCREA

The British Columbia Real Estate Association (BCREA) reports that a total of 6,206 residential unit sales were recorded by the Multiple Listing Service® (MLS®) across the province in February, a 5.7 per cent decrease from the same period last year. The average MLS® residential price in BC was $748,327, up 8.8 per cent from the previous year. Total sales dollar volume was $4.64 billion, a 2.6 per cent increase from February 2017.

“More stringent mortgage qualification rules for conventional borrowers are dampening housing demand in the province,” said Cameron Muir, BCREA Chief Economist. “Since the new rules came into effect, BC home sales have fallen more than 26 per cent, on a seasonally adjusted basis.”

Previous mortgage policy tightening has negatively impacted housing demand for a period of four to seven months, with the largest impact occurring in the third month after implementation.

Year-to-date, BC residential sales dollar volume was up 15.9 per cent to $8.47 billion, compared with the same period in 2017. Residential unit sales increased 4.1 per cent to 11,516 units, while the average MLS® residential price was up 11.3 per cent to $735,755.

Copyright ©2018 BCREA