A report from CTV Vancouver in Canada. “There are dire warnings that the condo real estate market in B.C. could collapse unless the province steps in to stop it. A representative of a condo owners’ association says recent changes to insurance rates mean that not only are buildings having to pay more for coverage – some are being denied altogether. ”This is something no one had foreseen,’ said Tony Gioventu, executive director of the Condominium and Homeowners Association of B.C. ‘This will collapse our real estate industry because no one will be able to get mortgages and there will be no buyers and no sellers.’”
“The buildings that are being hardest hit are those that are the most expensive: buildings with a high number of recent claims and strata corporations that have failed to keep up with maintenance and repairs. The Insurance Bureau of Canada says it’s a complex issue that won’t be solved quickly. A lack of insurance puts buyers looking to get back in the market at risk of losing their financing, and means sellers may struggle to sell their homes.”
“Zafar Khan is one of those sellers. Khan had an offer on his condo in Surrey, B.C.’s Cloverdale neighbourhood, and the deal was to close Feb. 3. But at the last minute it all fell apart, as the buyer pulled out of the sale. ‘I found out the strata ran out of insurance,’ said Khan. ‘If my lender finds out they’ll pull the mortgage.’”
The Kelowna Daily Courier. “What’s normal? It’s average. It’s neither high nor low, boom nor bust. And it’s what the Kelowna housing market is currently experiencing. ‘The consensus within the industry is this is a positive outlook for the year ahead and shows signs of the housing market normalizing,’ said Okanagan Mainline Real Estate Board president Michael Loewen, a realtor with Royal LePage Kelowna.”
“Buyers from Vancouver and Alberta are fewer and that contributes to the market not overheating. A normal market also means there’s more balance for both buyer and seller. Sellers have to price their home competitively to attract buyers and buyers have time to shop around and negotiate. In 2017’s boom, homes sold quickly, sometimes with multiple offers driving up the price. That’s unlikely to happen now as homes take an average of 73 days to sell and buyers have the chance to bargain for a deal below list price.”
From Vice Magazine. “Remember a couple months ago when everyone got really mad about that developer placing a $5 million chandelier under a bridge in Vancouver? Now the same douche canoe behind that glittering monstrosity, Westbank, is throwing a Lunar New Year Party at the Shangri-La Hotel in Toronto, with an opportunity to purchase condos in their new luxury development: King Toronto. The best part is, if you purchase a condo worth around $2 million or more, you get to spin a wheel for a chance to win totally normal prizes like a Porsche or a Rolex.”
The Globe and Mail. “1 St. Thomas St., Townhouse C, Toronto. Asking price: $4,898,000 (October, 2019). Listing price history: $5.2-million (September, 2019); $5.5-million (June, 2019), under previous agent. Selling price: $4,888,000. Agent Andre Kutyan sold this two-bedroom townhouse in 2015 and 2010, so the current owners requested his assistance when they couldn’t find a buyer when listed with another agent in the summer and fall of 2019. Mr. Kutyan combed through his database to find six interested buyers, and one was quick to mobilize with a bid late October.”
“‘The most recent sale in this complex was a couple of years ago – an end unit similar to this, but a little bigger – and it sold for $5.5-million,’ Mr. Kutyan said. ‘We had to be less than that in the asking price and the market had softened too, so we had to be positioned better under $5-million.’”
From CBC News. “The general manager of MCL Construction Ltd., says it should be easy for a northern country like Canada to get into the kind of home that is so efficient it makes more energy than it uses. Brad McLaughlin is beginning to wonder if reducing residential greenhouse gases is really a priority in this country. His certified net-zero home has maxed out energy efficiency. The house has insulated concrete walls, triple glazed windows, 44 solar panels and a backup rechargeable battery system.”
“But the three-bedroom, two-bath home stubbornly refuses to sell. It has been on and off the real estate market since 2017. Starting out, McLaughlin’s asking price was $695,000. By May, 2019 he lowered it to $570,000. This week he put the two-storey Quispamsis house back on the market at $495,000. ‘It hasn’t moved,’ he said. ‘We had a lot of people through it.’”
“McLaughlin points to mortgage ‘stress tests’ and indifference from bank-hired appraisers as obstacles pushing buyers away from these higher than average priced homes. He said appraisers hired by lenders to determine the value of homes are at a loss when it comes to this sort of construction. ‘Around here they just don’t know how to value it. …They just say, ‘Well there’s a similar house down the street,’ he said. ‘Well, sure it might look the same but it’s a lot different.’”
The Calgary Herald. “Overall, resales in Calgary’s luxury market declined by about 13 per cent in 2019 over 2018. All told 531 homes across all types priced $1 million or more sold last year in Calgary compared with 611 the previous year. Single-family homes made up 92 per cent of all luxury sales. And sales overall in the high-end market account for only five per cent of all resales in the city. The report notes less than five per cent of sales went over asking price in Calgary. The report also notes weakness in agriculture and energy weighed down the economy overall with Calgary’s unemployment rate remaining relatively steady at 6.9 per cent compared with the national rate at 5.9 per cent.”
“On a bright note, however, the city did see its highest priced sale last year since 2015. The home located in the northwest sold for about $8.6 million — one of two properties selling over $4 million in the city. According to media reports and previous MLS listings on the web, the property had previously been purchased in 2013 for about $11 million, a record high at a time when the market was strong.”
“Don Kottick, CEO of Sotheby’s International Realty Canada adds given the slow pace of sales, many luxury market sellers are likely willing to negotiate on price. ‘So the upper end still very much remains a buyers’ market.’”