Employment and other updates
We’re hopefully in the final phase of the deadly part of the pandemic here in Canada, and though COVID will be with us for the long haul, there is increasing optimism that increasing vaccinations will bring us to a pretty broad re-opening soon. Public health modelling suggests that many restrictions can be lifted when 75% have had their first shot and 20% are fully vaccinated, which should happen sometime early to mid June based on the latest data. We have a pretty low rate of vaccine hesitancy here in BC which is good news for the economic re-opening.
Source: Trevor Tombe
That won’t come in time to save the international tourism sector in Victoria this year, but it should bring a brisk pace of local business and the associated jobs starting mid summer. The unemployment rate has been drifting upwards again after coming down to just 5% in January (note 3 month average). However employment has been slowly increasing for the past 5 months which means the increase in unemployment may be more related to an increase in people looking for work rather than an increase in the unemployed.
According to April figures, the number of people employed in Victoria was only down about 3000 from pre-pandemic. Of course temporary hiring in the public service and health sectors may make this picture somewhat rosier than reality when that spending is rolled back but overall the employment recovery has been quite strong in Victoria. The Labour Force Survey also gives an estimate of population on a monthly basis. I’m not sure how accurate it is, so take this with a grain of salt, but it seems that despite an uptick in out of town buying, the pandemic cut our population growth from nearly 2% to just over 1%. This will be worth watching, as fundamentally all housing demand comes from population growth.
Will the CMHC First Time Home Buyer’s Plan affect our market?
In the last federal election, the Liberals promised to increase the buying power of their shared equity scheme for first time buyers. At the time I called that bad policy and thought the bump in maximum purchase price could now add some demand to our market. As it turns out buyers in BC recognized bad policy, with fewer than 2% of first time buyers taking advantage of the program. With house prices having risen to cancel out the increase in buying power since then, there’s little reason to believe this will move the market. If there’s a small increase in demand for condos due to it, I suspect it will be cancelled out by the stricter stress test very shortly.
My full thoughts on this are in the Capital here.
Also the weekly numbers courtesy of the VREB:
| May 2021 |
May
2020
|
||||
|---|---|---|---|---|---|
| Wk 1 | Wk 2 | Wk 3 | Wk 4 | ||
| Sales | 259 | 457 | |||
| New Listings | 365 | 1095 | |||
| Active Listings | 1495 | 2544 | |||
| Sales to New Listings | 71% | 42% | |||
| Sales YoY Change | +151% | ||||
| Months of Inventory | 5.6 | ||||
The market has clearly settled back a bit from the height of the frenzy, but what’s not clear is whether and how much it will keep cooling. Fewer offers don’t show up in the stats, and while the sales rate has been drifting downwards, that’s essentially just matched to the same decrease in new listings, and the sales to new list ratio remains around 75%.
I am expecting gradual cooling for the rest of the year, but it could be more abrupt as well. In 2010 we went from increasing prices to slightly decreasing within just a few months. When buyers had had enough, they simply stopped buying. This can certainly lead to a price pullback as it has in the past, but I don’t expect anything too dramatic.
One reason is that despite the runup I don’t think we’re in bubble territory given current rates, and because current affordability levels point to flat-ish prices in the medium term, rather than big declines. One stabilizing factor is our out of town buyers which have rebounded somewhat post-pandemic after several years of decline. They’re not enough in number to prevent us from getting into a buyers market and seeing price declines as has happened in the past and will happen again. But I think they may be numerous enough that they will keep those price declines slow as motivated sellers are absorbed by a slow stream of buyers less driven by local affordability. An elevated level of out of town buyers does seem to depend not just on the price difference to Vancouver, but also that there is an active sellers market there. If there’s a slowdown in Vancouver we’ll probably see the out of towners drop again as well.
One thing that I think is different this time is that once we hit that limit of appreciating prices we may be there substantially longer than we have in the past. For the past 40 years we’ve been saved by lower interest rates, and that has kept the price plateaus fairly short. Without that tailwind, it would take a lot longer for affordability to return to the market and require more years of price stagnation, inflation (which is expected to run hotter than normal for some time), and income gains to catch up.
A company with a market cap of $7.7 billion that have $561 in cash, with liabilities of $3.38 billion due in less than 10 months and an additional $13.7 billion beyond that, couple with growing cost of revenue. So the low P/E price reflect the high risks, and it will need to raise money (take on more debt or dilute shares) for solar and battery adventures that it can’t not afford at the moment except buying the hearts and minds of environmentalists.
New post: https://househuntvictoria.ca/2021/05/17/how-to-fix-the-housing-crisis
Has anyone walked through 1871 Elmhurst Pl? Sold for 1.045 (slightly under ask), but looks like there are two rental suits in the basement (a legal two bedroom and and inlaw?? house looks interesting but it does provide a way for lower income folks to get in if they can get the mortgage. the two suits should provide 2000 to 2500 in rent, which is pretty good on a 800k mortgage.
Building density on Oak Bay Ave is generally fine by me, and it’s probably fine by most Oak Bay residents, I’d wager.
Same goes for adding density along McKenzie and Shelbourne.
Problem is that those who want density along commuter/commercial corridors also want density within single-family neighbourhoods. Density everywhere!
That’s where the overeager urban planners lose me.
Don’t want Victoria’s population to explode. Don’t want to induce even more demand.
Looks even less enforceable than people renting out their “primary” residence and not claiming any income tax.
Zoning is part of the social contract between government and the people. The very reason we have zoning is that property use has externalities – the way a property is used affects its neighbours.
Not one of us would be willing to sit back and allow any use at all of the property next door.
It’s going to be several people buying those instead of SFHs, so yes, definitely.
Yes, the law. This is a “non-arm’s-length” tenancy which is subject to the spec tax.
https://www2.gov.bc.ca/gov/content/taxes/speculation-vacancy-tax/exemptions-speculation-and-vacancy-tax/individuals/tenancy-requirements
Well that would indicate that it conforms to the existing zoning. I’m not saying there shouldn’t have been consultation though.
Does anyone know what 967 Doumac went for? Thanks!
Big picture, I am not so sure. Last year I had a young couple buy a beautiful SFH in the Lake Hill area from the original owners who were moving because their 2,000 sq/ft pre-sale luxury condo in Cordova Bay was finished. If that condo is not available the existing stock of luxury condos is even more expensive preventing the lateral move for the original owners.
29 units. 22 local buyers. 10 of those 22 will probably sell a SFH and 8 of those SFHs will be in the core.
But another street on Bear Mountain will get built regardless of what goes up on Oak Bay Ave.
Ha, is there anything stopping anyone from “renting” their luxury condo out for 6 months to a friend from out of town (who may or may not use it) at below market rates such that the net affect on income tax is negligible?
So i suppose the seller’s realtor could have advised all buyers that they already have strong offers in hand and if they want to have a shot they need to go above asking? Or perhaps the best two offers ended up resubmitting multiple times until one dropped out?
Incredibly rare someone goes above ask unconditional unless in a competing situation.
The demand exists whether we build or not. The spec & vacancy tax ensures those luxury condos won’t be empty, so that means they will be lived in by someone (and if the demand isn’t there the developer will eat the loss and sell them at a discount).
Given the demand exists from people able to shell out $1.2-$1.8M, a luxury condo is the perfect place to put them. Compact, efficient, and doesn’t take away a lot of limited land. 35 wealthy people will have a place to live and use up 21,000 sqft of land instead of buying up 35 single family homes on 210,000 sqft of land.
What’s not to like? It’s not like we’re gentrifying a garden store here.
One bedrooms starting at 650k. 75% of the buyers will be local which means 22 current homes will be either sold or rented out as new owners move into this place.
Not to mention all the other benefits. There are 12 to 14 consultants on this project. The architect alone is taking home approx. $400,000 +/- for something like this.
City will require developer to carry out probably $500,000 +/- worth of civil improvements which benefits the entire community.
Tax base will increase by $200,000 per year, just enough to hire two more staffers at City Hall. Some rich person in a 1.8 million dollar condo will be paying $7,000/year in taxes. Net benefit to everyone living in a SFH.
Fantastic for the environment imo as we aren’t building another street on Bear Mountain to accomodate 29 SFHs.
Etc., etc.
4612 Royal Wood Crt in broadmead sold for $1.06M, albeit its not the nice part of broadmead, I think its still a good deal if there isn’t any hidden issues with it
https://victoria.evrealestate.com/ListingDetails/4612-Royal-Wood-Crt-Saanich-BC-V8Y-3C2/872790
Tell that to people who HAVE to live in Oak Bay, the greatest place on earth.
Couldn’t it be that there was only one offer above ask and it happened to be $1.275? looks to be a solid well taken care of house, that detached double garage in that neighborhood is rare and probably attributed to the premium.
https://victoria.evrealestate.com/ListingDetails/2717-Roseberry-Ave-Victoria-BC-V8R-3V1/875406
1.375
Leo, is this another example of how any additional supply, no matter how expensive, is a net win? Honest question.
The system is working beautifully.
You bought a house, not a neighbourhood.
Vistra actually isn’t that bad. 2016 is a long time ago. It has a low P/E ratio and gives a solid dividend. Buying a small position right now in the 15’s seems pretty safe. Winterization of infrastructure would be a confidence builder. Main thing is if you believe in them, go for it. Obviously don’t throw everything at it at once. Start a small position if you’re at all wary. Good luck Introvert.
What was the sale price for 2945 Eastdowne?
But a shelter where occupants burn down an adjacent building within a week of moving in somehow requires zero consultation?
Why shouldn’t they? I’d expect as much if someone wanted to do the same next door, and so would most homeowners I think. It’s not what I bought into. Having said that I should note that my neighbourhood has duplexes around the corner and townhouses a block away.
Spot rezonings are just a bad way to do densification. Should be done city wide and then builders just need a permit.
It went over ask which means there were likely multiple people willing to pay over $1.2 for it. The last 10 years on HHV I’ve probably mentioned 100 times how much I liked Oaklands and how I felt it was undervalued. As much as I still like Oaklands at these prices certainly not a deal anymore. I think the % (maybe not absolute) difference between Oak Bay and Oaklands has shrunk substantially since prices started running up.
A video of mine from 2014 at one of the homes we built -> “Why are brand new home so expensive? More and more regulation ever year!” https://www.youtube.com/watch?v=12wSTiTaMUA&t=2s
Keep in mind I was already talking about this when we had 500 sales per month and 4500 inventory. (now we are at 1000 & 1500). My point is it isn’t like the market goes sour and the regulations go away.
I think going forward I will just keep the new homes in the core as rentals verus selling as I honestly think the amount of regulation piled on each year will drive prices of newer builds higher even within a flat overall market. You’ll always have the 1%ers that can afford it, but there won’t be any inventory. You won’t see builders flocking to teardowns to deconstruct them by hand. You’ll be able to build three homes on the Westshore in the timespan it takes to build one in the COV.
It is but it’s cooled from burn your face off to it might be saveable with reconstructive surgery. Some people haven’t noticed
The system is so completely broken.
“Gordon Head residents are invited to join planner Kaeley Wiseman from Wiser Projects in an informal conversation about the local challenges and opportunities in the Fairburn neighbourhood
Ms. Wiseman is exploring a potential townhouse infill project at 1853 and 1855 Fairburn Drive.
Prior to submitting a rezoning application or completing design work, she would like to hear from the community what has worked in the past, where your concerns may be with additional housing, and what housing and amenity opportunities are desired.”
Two piddling lots combined to make a few townhouses and planners need to not only go through a development application and rezoning they need to have pre-meetings to grovel at the feet of neighborhood associations for support.
up-and -coming- By the time you deconstruct your home, wait for all the permitting for your new build, then try to find the trades to build it, your kids would have finished university and moved out. Then you’ll want to downsize. Hope you have a sense of humour, do what you want, I’m sure you like your neighbourhood, but does your neighbourhood like you.
Excellent news perhaps you can pull a HELOC and invest in the failing company to prop it up. It declared bankruptcy in 2016 and was rated negative BB+ rating (in another word worst than junk) just days ago.
2717 roseberry for 1.275m$. Seriously? Who in their right mind would pay this much for this house? I thought the market was cooling a bit!!!
https://www.wsj.com/articles/batteries-challenge-natural-gas-elecric-power-generation-11620236583?mod=hp_lead_pos5
From: https://vancouversun.com/business/b-c-real-estate-services-firm-ordered-to-cease-operations-following-regulators-investigation/wcm/50f0a1d8-41c2-477a-925c-a80b5f7f74d3/amp/
From: https://www.timescolonist.com/news/local/victoria-aims-to-divert-construction-waste-from-landfill-by-deconstructing-instead-of-demolishing-1.24319642
Lol.. the city keeps finding more ways to help affordability. Deconstruct by hand shouldn’t add any significant costs (sarcasm for the ones that can’t tell). I bet this will also come with a new inspection, permit and reporting requirement as well. I guess they don’t know that if there is valuable salvage “such as old growth timber” that tends to be recovered and sold anyway.
““Frank
May 16, 2021 7:17 am
up-and-coming- Why did you buy a house that didn’t work for your family in the first place? You’re not making any sense.”
There are lots of reasons where circumstances change and the initial purchase may not work out.”
Exactly. Frank, please think about all the “great advice” people give to buyers on this very forum. Buy any home home to get into the market they say, scratch and save and live in the suite they say, the right time to buy is when you can afford it they say. None of these take into consideration when that person that got all that “great advice” decides they’ve sacrificed enough to renovate or rebuild (even to the neighbours discontent) that maybe that property they first bought wasn’t their ideal home and now it can be. They should be allowed to do that, even if their boomer neighbour Frank doesn’t think it makes sense.
It would be wiser for the economy, imo, if they caught up from being an employee on a construction site to having their own construction business versus starting as a Clerk 9 in the BC Government and moving up into another better paid government position.
Recent immigrant stereotype I have seen in Victoria from Croatia. Young couple comes as one secures a job in IT making 70-90k a year, partner secures Clerk 9 or similar government job to start so you are over 100k family income almost immediately. They usually have close to 5% down already as you must show proof of funds for immigration -> https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/express-entry/documents/proof-funds.html#money_needed
They are buying real estate within 12-24 months.
Looking forward to this one
The maples will form a union and demand equal rights. Those oaks are just too damned lofty and they grab up all the light. I hear the same as do Thumps. Hatchet axe and saw cometh
Anecdotal….I know.. but I have heard from a fairly reliable Canadian source that there is unrest in the forest
There is trouble with the trees…For the maples want more sunlight….And the oaks ignore their pleas.
Not sure I want to be in the middle of that argument either.
I’ll take trees over people any day.
Yes, through the listed obstacles would also apply to a home grown non-immigrant Canadian entering the workplace. If they don’t speak English, have the right skills, have any connections etc. they’ll have less job opportunities. Immigrants do remarkably well though and most catch up (or better) within 10 years.
I do agree with your stat, and I also mentioned that there is a different among uneducated and skilled labours. The stat also indicated that foreigners shouldn’t immigrate to Canada unless they speak perfect English with enough cash flow to retrain in Canada for 5 or more years.
The linked article in my previous post mentioned one of the reason for unemployment among immigrant is mismatched skilled level and high requirements barriers that take 10 years before the unemployment rate equal to Canada born.
Yes, but my point (and data provided ) was that unemployment in immigrants is lowest for university educated vs non-university educated. What’s race got to do with that?
You are correct.
I think the crux of the immigrant unemployment rate is racial as indicated by Stat Can.
https://fsc-ccf.ca/wp-content/uploads/2020/01/EmploymentGaps-Immigrants-PPF-JAN2020-EN.pdf
The majority of the cohort who immigrate to Canada is between the age of 24-34, because we need workers and thus they bring in their parents with them.
Number of people immigrating to Canada in 2020, by age — https://www.statista.com/statistics/443305/international-migrants-in-canada-2014/
No, elderly and housewives (ie not looking for work) aren’t classified as “unemployed” in the statistics. They would be classified as “not in the work force”, and therefore not included in the employment/unemployment statistics, since it only measures people in the work force. The figures and links I posted are from govt statistics of people in the work force that are working or looking for work.
Big different between unemployment with high school education, and skilled trades. I would like to see the immigrant unemployment rate between the age of 19 and 65 vs Canadian. I have the feeling that the immigrants that are unemployed are house wives and elderly that were sponsored to come over.
Changes to immigration policies are needed to attract migrants who can meet skilled trades construction needs — https://biv.com/article/2021/01/new-canadians-can-reduce-trades-shortage
I agree 100%.
The immigration process into Canada looked incredibly simple for those that are looking from the outside; as if Canada arms are wide open like pre World Wars. Now the barriers that are hiding behind the immigration process have created many jobs for lawyers and Canadian organisations. In the mean time Canadian are free to immigrate and take up jobs in developing countries without much requirement.
IMHO, the process should be simple and smooth transaction as spelled out by the regulation. Similarly, don’t call it free trade, then put up trade barriers that hide behind the process.
Bad idea.
Canada…
– unemployment rate 5%. Construction industry unemployment rate 10%. University educated unemployment 4%. https://www.statista.com/statistics/578391/unemployment-rate-by-industry-canada/
Have first hand experience with this program….too involved/expensive for a tradesperson in another country. Unless they have a family member here already helping them it would be near impossible. I can’t remember the last time I met someone on a construction site that went through this program.
I know a lot of young Croatian immigrants in Victoria and the only one that couldn’t sort out his paperwork was drywaller working 60 hours a week, now he is in Munich drywalling. The rest sorted out their paperwork and half work for the BC Government.
The problem with have the requirements/process to enter the country so incredibly high so the people that make it are usually educated and savvy. Savvy enough to interview well and land a government job.
OK so sell it and buy a house that suits you. Ordinary people just don’t have the means to tear down a house in good condition and build a new one. That’s hundreds of thousands of dollars sent to the dumpster.
I think that’s a bit high. If you were talking about economic immigrants alone probably closer to the mark, but there are also family class and refugees.
https://www.statista.com/statistics/555224/number-of-landed-immigrants-in-canada-by-education-level/
Construction trades appear to be eligible for Express Entry BC (EEBC) – Skilled Worker category of the BC Provincial Nominee Program (BC PNP):
https://www.welcomebc.ca/Immigrate-to-B-C/BC-PNP-Express-Entry-B-C/EEBC-Skilled-Worker
I think most reasonable people will think if housing returned 6ish percent in a dropping rate environment (leo has the exact number) then it will be less than that going forward. I think it’s possible we have one more serious rate drop where they go negative and mortgage rates get close to zero but then that’s done.
The only last thing the government could do – which I doubt they will – is jack up amortizations (40 year) or bring back 0 down payment but that seems seriously against the CMHC mandate.
Also rent prices are stretched and you can’t get blood from a stone so that will also stifle prices somewhat imo.
2%, 3%, 4% return. Who knows but seems almost certain it will be less than what we have seen my generations whole life.
“Frank
May 16, 2021 7:17 am
up-and-coming- Why did you buy a house that didn’t work for your family in the first place? You’re not making any sense.”
There are lots of reasons where circumstances change and the initial purchase may not work out.
+1, but I think Canada should increase proportion of non-university grad immigrants. I think over 80% of immigrants have an university degree.
One of my studios downtown last August I rented out to a university educated immigrant that literally just arrived to Canada. Immediately secured a BC government job and is now putting in offers on condos. I showed him a place yesterday that is taking offers on Tuesday and he says “send me the strata docs I got my flex Monday to review.” 🙂
I am happy for him for landing on his feet so quickly and I benefit from the condo he buys but big picture imo we need immigrants working six day weeks on a construction site not four day office jobs.
Yet two trees on Foul Bay Rd are preventing 20 families from living there. #savethetrees
Interesting concept and a sign of low vacancy/high rents: https://www.timescolonist.com/business/a-tower-for-communal-living-rent-a-bedroom-share-the-kitchen-and-bathroom-1.24319635
That projection is based on no longer declining interest rates for the next decades. I don’t believe you can project out growth rates from 40 years of dropping rates to a period where we likely won’t see that. https://househuntvictoria.ca/2020/12/21/where-would-we-be-without-dropping-interest-rates/
As for the fact that prices jumped a lot recently: expected return decreases when prices increase. Most people think the opposite and jump in to something that has just had very good performance.
Exactly, I can also go buy any non-heritage status home, pay PTT, and tear it down if I want to.
Marko- You can buy whatever vehicle you want to go grocery shopping as long as you pay a gas guzzler and luxury tax on it.
up-and-coming- Why did you buy a house that didn’t work for your family in the first place? You’re not making any sense.
There is a lot of options you can do with your principal residence, if unsure I’d get a CA to prepare a tax memo before making any decisions and filing any elections. If bored you can check out these subsections and special bulletin’s.
54 – Definition of principal residence
40(2)(b) – Disposition of principal residence
45(1) – Capital gains and losses
45(2) – Change in use disposition
45(3) – Avoid change in use provision
45(4) – Where election can’t be made – Claiming CCA on property
CRA Folio S1-F3-C2 – Principal Residence
T2091 – Principal residence disposition
As I’ve pointed out, the past year has seen Canada’s lowest population growth in decades, yet it has seen the the highest increase in housing prices Canada-wide ever.
If you read the text carefully you will see that the property in fact remains your principal residence for tax purposes, and you cannot designate any other property as your principal residence. The primary purpose of this option is to accommodate people who temporarily move and rent for a period, and then move back to the property they own.
The People’s Party of Canada ran on a platform for reducing immigration to ~100,000 per annum. I don’t think they got arrested for it.
Don’t confuse “can’t talk about it” with “don’t want to talk about it because we need to win 905”.
Marko is hilarious, comment of the year!
So someone buying a supercharged V8 Land Rover to pick up groceries at Thrifys should have to provide an explanation as to the benefits of their actions?
“If someone is going to tear down a house that is in excellent condition, they should have to provide an explanation as to the benefits of their actions.”
Uhhhh, sure: In my (the new owners opinion) this house doesn’t work for my family, so regardless of whether it’s new, in excellent condition, or great in the eyes of the neighbours, the new home I will build in its place will benefit my family…
Does that explanation work? If no, please explain why anyone should be held hostage even more than the already restrictive rules on any given property
$2.4M
Does anyone know what 3863 Cadboro Bay Road sold for?
We are already lowering population growth, and have been doing so for at least the last 70:years. Population growth rate in Canada is at a 70 year low. It’s been falling constantly since 1950, from 3% to <1% now. https://www.macrotrends.net/countries/CAN/canada/population-growth-rate. And UN projection has the Canada population growth rate continuing to fall. It’s hard to single out population growth as the main factor in rising house prices. Low mortgage interest rates are a bigger factor IMO. Stopping population growth would likely lower house prices, but also lower economic growth, standard of living gains, and ability to expand social programs.
Less than half of one percent of the land in BC is urban.
The urban sprawl crisis is fake news.
Who going to clean your office toilet, pick your fruits, bag your groceries, and wipe your ass when you are old if we don’t have population growth?
Spent fuel can be recycle and reuse at anytime, thus would create little to no waste but costs is a factor at the moment.
It is easy to say when we are living in the Capital that consumes over 30 liter of oil per person, to those that live in District 12 who are struggling to get by and are looking to move up to the Capital lifestyle while producing an extra 90 million bodies per year.
We could avoid both sprawl and densification if we didn’t force continuous population growth (through immigration in Canada’s case).
I agree with this. Discussion of the imperative of population growth is not permitted in public Canada. Orwellian, and very obvious.
https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-127-capital-gains/principal-residence-other-real-estate/changes-use/changing-your-principal-residence-a-rental-business-property.html
Former Landlord, you have just given me a hugely important piece of information here. There is the option to keep a former primary residence turned rental in non-tax exempt status in exchange for total relief from Cap Gains tax for at least a 4 year period after the initial turnover and your move out.
I’ve ran an estimate of property tax deduction savings vs. capital gains taxes on my property. I am sure you and others have been through this scenario many times. The best route depends widely on projections about maintaince (not too hard to predict) and property appreciation (impossible to predict).
So what is best in Victoria from 2021???
No one has been able to predict the Victoria market the past two years. Gosh what about the next four?
I read somewhere Leo suggests single family dwelling rise maybe of 3% going forward. That seems very low. I mean, we have seen double digit climbs in the past few months. Of course there could be a correction as well in our future. I guess everyone is making widely different assumptions here?
The one factor in my personal situation is that I can choose when to sell. So theoretically it should be possible to determine a selling price in advance. Say, sell a currently valued 1M dollar property at 1.5M and resolve not to sell before then. Assuming reasonably predictable forfeited tax deductions you can be fairly sure of coming out ahead. Downside of this is the added incentive not to sell sooner which might have other benefits down the road.
Anyways….
Population growth is the crux of the housing problem.
We could avoid both sprawl and densification if we didn’t force continuous population growth (through immigration in Canada’s case).
CoV tries to reduce waste going to the landfill and it impacts Marko…guess what happens next.
By this logic, any forest can be clear-cut because we mustn’t be hypocritical.
Which wasn’t available to me because I claimed CCA. But yes, if you plan ahead and don’t claim CCA on the possibility of moving in yourself, you can defer reporting until it is sold.
Any updates on the offer Cadbro?
Re: Nuclear Energy. Couldn’t agree more with fern, they pose enormous logistical problems regarding storage of the waste. Talk about NIMBY. The thought of the proliferation of these super-expensive steam plants is unimaginable. I prefer wind, solar, and population control.
I’m no expert but a few issues come to mind:
1. Fuels/facilities have to be maintained for 100s of thousands of years due to extremely long half life.
2. Accidents and problems from earthquakes etc (think Fukushima), also made worse by long half life.
3. Can also be used to create nuclear bombs and increase the proliferation of nuclear weapons.
If someone is going to tear down a house that is in excellent condition, they should have to provide an explanation as to the benefits of their actions. Obviously a property in terrible condition requiring hundreds of thousands of dollars in repairs to bring to code is not worth saving, yet it seems these are the houses everyone wants to save. That’s why the neighbors don’t band together and buy these properties, it’s just not financially feasible. They want someone else to lose their shirts on the project to make them happy.
Yes, but one of those special circumstances is changing from principal to rental
https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-127-capital-gains/principal-residence-other-real-estate/changes-use.html
However, changing from partial rental to full rental is not a special situation. So if you move out of your principal with rented suite and convert to a full rental, you would need to pay the capital gains in the year of the change of use.
Although some on this forum have pointed out, there seem to be some situations where you do not need to pay any capital gains on the rental portion of your principal residence.
Even today, no matter what I read, or what I think, or what someone else reads or what they think, if there is a substantial amount of money involved, I would seek advice from my accountant, and as always, keep all relevant documents.
I didn’t. I went to my accountant and I didn’t pay the capital gain until I sold the property. CRA were okay with it
Unless there are specified special circumstances, the sale is deemed and cap gains are payable for the year you move in.
I was in such a situation myself and just used the latest assessment, they were OK with it.
“I think the reasoning is that making it more expensive to densify in COV, will result in more building in other areas instead, since this would be more cost efficient.”
Based on the constant complaining on here about permits, inspection delays, back and forth with planners I would say we’re already here…
Sorry, if the rental started in 2020, keep the assessment for that year as well as the realtors letters of value.
If you lived in the house, or it wasn’t rented out until 01 June 2020, keep your 2021 property assessment. Then get (2?) realtors assessment of fair market value at the time of rental. (It isn’t going to matter if they make the letter out a couple of weeks earlier or later) Keep both of those documents. You might move back in to the house at a later date or you might sell. If you sell the house without ever moving back in, then obviously you will pay the capital gain on the gain between the time you rented the house out (assessed or realtors value on date of rental ) and the amount you sold the house for…….minus realtor fees, lawyer fees etc. If you move back into the house; you will have to keep documentation as to the value at the time the rental ended so down the road when the house is sold, you will have proof of that value to the CRA.
The CRA explains on their website what you need to for different scenarios for a change of use of your property.
https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-127-capital-gains/principal-residence-other-real-estate/changes-use/changing-your-principal-residence-a-rental-business-property.html
Thank you 🙂
So would it be calculated then from say June 2021 to May 2031? So, specific to the exact date (month) of that realtor assessment? It just so happens a realtor graciously did one of those for me; didn’t know it could be used in this way. Time to get another or maybe even three.
From my experience you can use the assessed values or say a couple of realtors assessments of fair market value. If you purchased a home in say 2001 Paid $500K, lived in it for four years, then rented it out in 2006; you can keep the assessed value at the time of rental, or get say two realtors go give a letter of fair market value. Keep those documents. Then, you decide to move back in in 2010, keep either the assessed value or new realtors letter as to value. When you do eventually sell the property then capital gains is payable on the gain between 2006 and 2010.
Do anyone know how the CRA determines historical home value to calculate cap gains tax? If a property became a rental 10 years ago, is CRA precise enough to assess market value of the home specific to a particular neighborhood and a particular month the home was rented out?
Listened to an interesting podcast episode about meat replacements and the question came up of whether current vegans or vegetarians would even want meat alternatives that taste just like meat. The answer was vegetarians are completely uninteresting to them because they’re not relevant. Something like 3% identify as vegetarians but two thirds of those admitted to eating meat recently. The real gains are in converting the 99% not convincing the 1% to grow to 2%. https://samharris.org/podcasts/244-food-climate-pandemic-risk/
Part of the problem is some perverse version of Tragedy of the Commons. One person or family has zero lifelong global impact on climate change so the incentive to curtail quality of life for this purpose is next to zero. Anyone can become vegan, sell the car, and live off used clothing and garden food for a lifetime and it will make zero difference to CO2 quantities in the atmosphere measured in billions of tons. It is perfectly rational to live without regard for climate change on an individual level. This is tragic because obviously in the aggregate we collectively make a huge difference to climate change outcomes.
On the other hand, as responsible citizens, how we vote, the issues we raise to leaders, and our lifestyle choices in small ways should be consistent with our values. We all do these little things, it too will lead to great changes. Politicians are very sensitive to every sigh and smile of the “body politic.”
Speaking of technology, had we turned to nuclear power in the 1960s we could have avoided much of this climate change mess. Deaths from nuclear accidents number in the hundreds while death from climate change number in the millions worldwide. There are even technologies developing that will eventually turn the waste into energy. I’m no expert, but the choice against nuclear power just doesn’t ad up. Far from perfect but far better than all the alternatives until we have clean renewable en masse. Huge mistake. Expert prove me wrong.
“At the end of the day, protect all old growth, all endangered species habitats, and all special areas of concern. After that, let the chips fall where they may
The chips will fall on we build no new housing.”
Thats not necessarily a bad thing…..if the true costs of cutting trees, destroying bogs, killing bees etc. Was taken into account most people couldnt afford a treehouse in Victoria. This is the problem with our economic model – we are too dumb or lazy to notice we dont take everthing into account. Thus, our whole way of life will end sooner than we think.
I think it is necessary to push people right to the limit if not over. Only way they will rethink having 2 kids,flying, having a 3500 sq ft house etc. You cant suggest a cut to peoples quality of life. Only way is to have the price of an item reflect the true FULL cost of producing it – and let everyone readjust their life accordingly.
We have a falling birth rate. This gives Canada the opportunity to control population growth. Boundaries!
It’s human nature. That’s why our only hope for climate mitigation is technology. Humans won’t change en masse so we need to make sure what people like to do is made clean, and make the cleaner activities easier and better (bike lanes, transit, living closer to work, etc). It can be done and has been done in many European cities that were previously totally car focused and are now totally transformed. Victoria will go the same way.
Listened to an interesting podcast episode about meat replacements and the question came up of whether current vegans or vegetarians would even want meat alternatives that taste just like meat. The answer was vegetarians are completely uninteresting to them because they’re not relevant. Something like 3% identify as vegetarians but two thirds of those admitted to eating meat recently. The real gains are in converting the 99% not convincing the 1% to grow to 2%. https://samharris.org/podcasts/244-food-climate-pandemic-risk/
That was gold Barrister. The local term needs to reference the homeless somehow.
People don’t want to hear what doesn’t fit with their own narrative and politicians don’t touch those subjects either as it would be political suicide.
i/ We all want mini-mes running around so no one is going to tackle the subject of how bad having kids is on the environment given the population grew by 73 million last year.
ii/ Everyone has a pet so that subject is also off the table when it comes to the environment.
iii/ In North America the dream is to own a single family home so no one really likes to bring up the point that density is so much better for the environment.
Everyone is super excited about saving the environment but as long as it doesn’t impact them having 2.2 biological kids, a SFH on a 10,000 sq/ft lot, a dog, a cat, and an ICE SUV/truck because EVs can’t pull boats up to the cottage, flying across the globe for vacations, etc.
A bunch of other crap that doesn’t fit anyones narrative and then we come to
CXLVIII/ hand deconstruct a home. Based on the FB comments not a bad political move. The average person complaining about housing affordability just isn’t smart enough to put together that this is bad news for them and it doesn’t impact any of their own narratives. No one is telling them that their dog foods has to be shipped to the pet store, which has to be heated year around, etc.
This commonly comes up in Victoria, lots of TC stories about neighbours being upset when it comes to NON-Heritage Status homes being torn down. Why don’t a bunch of people of similar mindset just pool their money, buy the house to avoid such an atrocity and rent it out while continuing to main it immaculately?
We should be prepared to increase the number of firemen in the city since a lot of houses are going to be hit by Sicilian lightning. Easier just to burn them down than deconstruct them.
My friend’s brother recently passed away, they are both psychiatrists, and he lived in an exclusive neighbourhood known as Old Tuxedo in Winnipeg. It would be comparable to Uplands. His 3200 square foot (not including the finished basement) on 2 levels has been purchased by the neighbours and they are tearing it down. The house, built in 1929, is in immaculate condition. His brother spared no expense on high end renovations and mechanical upgrades. I’ll be removing as many doors and windows as possible for resale. The demolition of this house is a crime and should not be allowed. It was purchased for around $800,000. In a comparable location in Victoria, it would be over 2 million. The house could easily last another 100 years, granted it is not as energy efficient as a new house, the quality of construction is not achievable today and the materials are far inferior in modern homes. Unfortunately it did not qualify for Heritage Status. Talk about a waste, that’s progress is suppose.
I would personally rather see people take responsibility for their own actions and do the right thing for the world in which they live, without motivation or incentive, but that is like waiting for a train that will never come….or maybe more appropriately a Greyhound bus.
Sad face all-round peeps
Absolutely it will. I was just thinking it might be the lesser of two evils (everything must be deconstructed vs. salvageable materials removed). I would personally rather see it incentivized vs. required.
The chips will fall on we build no new housing.
At the end of the day, protect all old growth, all endangered species habitats, and all special areas of concern. After that, let the chips fall where they may 🙂
I think the reasoning is that making it more expensive to densify in COV, will result in more building in other areas instead, since this would be more cost efficient.
“How on earth is deconstructing a home going to have any environment relevance to the clearcutting taking place on the Westshore?”
This is flirting with being a false dilemma as I don’t believe COV is doing this to have any environmental relevance to clearcutting elsewhere in the CRD, they have a zero waste goal they’re trying to achieve. I’m not saying I agree with the deconstruction policy, but be clear about the intent behind it and don’t use it to push another narrative.
Also, you’ve got to love the shade thrown on the Westshore municipalities that are currently developing previously undeveloped areas when people compare them to Victoria, which did their clearcutting long ago before people had the option to whine about it on Twitter and Facebook. Most of their ivory towers in Victoria are standing where a grove of trees used to exist
We actually missed the boat on the ‘Unbuilders’ idea by a couple of years. Our old house was demolished in 2017 and I asked around a bit about deconstruction services, but came up empty (at least my builder and designer had not heard of any and nor did Google suggest any; I think there was one company in Vancouver just starting this at that time). We got a few floor joists salvaged by a reclaimed wood guy (Al Halll – Hall it Up), and gave away appliances and a couple of toilets. But it did seem a shame that the extensive fir 2 x 4s could not readily be salvaged. I thought Al would take the oak flooring for sure, but he said it’s very hard to pull up old flooring without destroying it.
I also would think an incentive would be a far better idea than an outright requirement at this point. I guess the devil’s in the details (will they be rejecting demolition loads at Hartland now? Other dump sites? Are inspectors going to be charged with enforcing the deconstruction process?).
More useless costly paperwok. Will add delays in terms of the building permit being issued as well.
Requiring all home demolitions to be hand deconstructed is absurd. Some homes aren’t even candidates for it – safety issues or poor recycling yield due to unsuitable timber etc. If the government wants deconstructed houses, they should instead provide tax incentives for it, and let the builder decide if it makes sense or not. Incredible that in the midst of their stated goal to increase density, they come up with regulations like this to slow it down.
Now there’s an idea. Want to replace one single family home with a new single family home? Must be deconstructed, new build must be net zero, and you give some CACs. If you instead densify those are waived / scaled back.
Moving on
Wouldn’t have ever expected to see a person get so triggered over some fish being saved, but there you go.
I’d have to see the proposal since I think it really would depend on the building. I know areas of Vancouver are already requiring this.
I’ve seen some interviews which state the old commercial spaces / warehouses are a goldmine of old timbers and it makes financial sense to ‘unbuild’ them.
Perhaps some higher end older homes will have valuable timber, and most homes have some wiring/plumbing that can be recycled. Before I tore down my current place, we advertised anything usable for free and the plywood kitchen and bathroom cabinets went, as did the toilet, mirrors, and some other hardware. The old fir floor was removed and re-laid in a passive house around the corner. Copper was pulled out. Beyond that there was nothing that could be re-used and we just did our best to separate out the debris once the excavator had crunched it down.
House before that had absolutely nothing that could be re-used and very little which could be recycled. Took it down by hand only because I had no $…but it all went in the skip.
I could maybe see the city requiring some kind of assessment by a third party which notes anything which can be realistically re-used / recycled and require that stuff to be pulled out and separated from the garbage, but what’s the point of hand demolishing stuff that’s going to the bin anyways?
https://unbuilders.com/
Stroller seems like a fun guy.
It really seems like the number of listings looks to be on the move upward the last few days. I wouldn’t call it a surge or a flood yet, but definitely seems like more coming on and hanging out a bit.
Black Addered
Or perhaps the more market-based approach: jack up the cost to dump demolition/renovation waste to reflect the true impact to the environment so that the entire population is not effectively subsidizing the disposal costs of a discretionary new kitchen.
Huh, that’s sort of a tough one. There is an absurd amount of waste created from demolition and renovation and that’s a problem that needs to be tackled. Even more so on the Island. You can do tours of Hartland Landfill, highly recommended if you want to learn more. I believe their latest estimate is sometime in the 2040s they will be at capacity and its unclear what the plan will be for Island waste at that point.
That said, adding more barriers to increasing density is not great at this point. I’d perhaps support a policy like this which applies to any demolition that does not result in an increase in density after the new build is complete. Ideally something would be mandated for renovation waste as well (to address Marko’s kitchen example for instance).
You mean another another 50,000?
Marko- Don’t forget to only hire 50,000 new immigrants. That’ll make everything better.
Some comments from FB….
“Costs of 30k vs 12k is only 18k difference – if you’re demolishing and rebuilding it’s a pretty small percentage to add. Plus jobs. Don’t we always want more of those?”
Yup let’s make things as inefficient as possible in the name of extra jobs. BC government should just hire another 50,000 people, tomorrow.
3492 henderson sold around assessed at just under $1M
https://victoria.evrealestate.com/ListingDetails/3492-Henderson-Rd-Oak-Bay-BC-V8P-5A9/875450
Anyone know if there are any hidden issues with this?
This is the wealth affect at work, when you have paper gains you must spend some of that money to and get a all white kitchen.
Yea obviously Marko. Thats my point. 2 trees cut is better than 100. Especially when townhomes are being created over sfh.
Cutting down two 100 yrs old trees in the core to accomdate 20 townhomes is a lot better than cutting down 100 100 hundred year old trees to accomdate 20 SFHs in Sooke (need to factor in roads etc.)
Planting a new tree compared to cutting a 100 year old tree is not equivalent. Even if you plant as many trees as you cut the earth is at a loss. We should be limiting the amount of older trees we cut in general.
One could argue the earth is screwed anyways. Until we get rid of earth’s parasite – humans – the earth is screwed. I just wish i could be here to watch it all end. Watching everyone complain as the bees die and we lose 30% of our food supply would be entertaining. These are the same people having children, using pesticides, flying on planes etc. contributing to this issue. I also contribute to this mess, although i dont have kids, (thankfully) drive an electric car, have solar panels, compost myself, grow many veg and fruit myself, cut back on meat by 50% in the last 5 years, and generally am very conscience of my impact. I do not think the earth will become inhabitable in my lifetime, all i get to see is the slow but steady destruction of our only home. When i went scuba diving in 2017 in the GBR, my heart sank as i saw 500ish year old coral leeching its guts into the ocean. About 50 ft from this coral were fishing cages in a no fish protected zone of the reef. Luckily i had a knife and let all the fish out. God i hate humans.
The furstating thing about all of this is I live in a higher end building with two other higher end buildings on the road and there hasn’t been a week in the last 52 weeks where I haven’t seen a kitchen contractor on the street. My building is just over 2 yrs old and at least 12 units I can think of have ripped out perfectly functional near new kitchens and renovated. How is that okay for the environment but we have to hand deconstruct a home to make room for more housing.
I don’t disagree. Just saying if the city wants new stuff which it seems they’re hell bent on doing, they’ll have to offset it somehow.
Heck, we could mandate that they do the deconstruction with toothpicks and create 100 jobs!
Often decisions that made into standard or code by collective group of engineers such as ISO or SAE are there for the safety and improvement of a product. However, generally local jurisdiction authorities that have no hand on or practical experience come up with their own bylaw or codes are often from knee jerk reactions, or because it is empire building to assure that they have a job.
I can’t see what can be save from an old house, beside recyclable copper tubing and wiring. Even perfect old wood with no damage are difficult to reuse, because it is too dry and splits when nail into.
How on earth is deconstructing a home going to have any environment relevance to the clearcutting taking place on the Westshore? Drive by the construction site on Sooke Rd where they are expanding the road due to sprawl in Sooke.
We need to encourage density not non-sense to further push the cost of housing in the core. This just makes it more attractive to build on a vacant lot on the Westshore versus tearing down a POS in the COV which at very minimum is replaced with a SFH with a suite, adding one more unit that doesn’t require more cars/massive infrastructure costs.
LOL.
I just don’t get why people are so focused on preserving existing trees. I think we can all agree that trees are nice and we want them. So take note of the trees on the site, cut the ones down that need to be cut down, then ensure that we are planting at least as many as we had previously or add some more offsite. Done and we can skip the circus about preserving each tree where it stands.
This is the dumbest idea ever. Not only will it pile on an extra 20k+ but also it will take 5 yrs to build a house with all of this non-sense. Where are you going to find contractors that have reliable employees that hand deconstruct? wtf.
The house we are building right now literally every single small thing in a complete nightmare. BC Hydro and COV have been out four times each and can’t agree on how much to prune a try so we can connect to power. We’ve been running a generator at the construction site for two months still without power.
COV comes out, cuts one branch, BC Hydro comes out…”sorry not good enough,” COV comes out cuts one more branch, BC Hydro comes out. You give the COV the cellphone of the BC Hydro designer and they still can’t agree.
Now multiply that with 10x other non-sense BS things, some even dumber. If you look at my comments from 10 years ago on HHV I was predicting newer homes would be a small fortune due all the red tape coming into play. It just keeps getting worse and worse.
As I said a few weeks ago my friend started rezoning a R2 to R2 with suites and the COV wanted 300k of civil upgrades/contributions. Scrapped it and will just do building permit duplexes without suites now. How do these policies promote affordable housing?
I don’t know enough about the economics of deconstruction to have a good opinion on it. Overall I’m a strong proponent of reducing our environmental impact so I tend to support things like the step code to improve energy efficiency.
The massive problem is that we can’t just pile on additional costs without also reducing them in other ways.
The city needs to adopt a system where any motion to add costs for building needs to be matched with one to reduce them. Want deconstruction and passive house new builds? Then upzone so people can skip the rezoning process and save the money on that side. Want more contributions for the community? Then guarantee next day response for builders and reduce permit requirements or cap the total time to approval.
From Vibrant Victoria:
“Starting next year, the City of Victoria will require home demolitions to take place as by-hand deconstruction, which it says will bring it 15% towards its goal of reducing waste by 50% through 2040. However, costs to do so, says the City, could be tens of thousands of dollars higher per demolition due to the labour and time required to dismantle a structure piece by piece. After the sale of recovered materials the City estimates costs to homeowners will be as high as $30,000, compared to the typical cost of $12,000 to demolish a home.”
Great idea to save waste or expensive overreach further eroding housing affordability? Discuss.
How much of a hit on the house resale value if I replace 2 of my bathtubs with walk-in showers?
We have a total of 4 full bath at the moment.
I have to say as someone not known to heap praise upon our healthcare system, BC has this vaccination program dialed in right now. I went from front door at the convention center to vaccination in like 5 minutes today. Register online, they are making this easy for us.
For context on those covid case numbers per day per 100,000 people (for the week May 4-10)
World 10.
Greater Victoria 2.4. <—Lowest rate by far of all the places listed below, other than gulf islands
Greater Vancouver 15
Smaller Gulf islands (Pender/Saturna/mayne/galiano Island was 0
BC 12.
Canada is 17.
USA is 16
India is 25.
Manitoba 30.
Alberta 40.
Quebec 10.
Ontario 20.
Kudos to Bccdc.ca , they did release the data behind the covid numbers for the week May 4-10
Good news across the island with low rates.
Here is the data for regions of greater Victoria and gulf islands
City , covid number/day/100k people, % test positivity
Downtown Victoria/Vic West 3.3 2.3%
James Bay/Fairfield 2.0 3.1%
Oaklands/Fernwood 2.9 2.2%
Oak Bay 2.1 2.1%
Gordon Head/Shelbourne 2.7 2.5%
Quadra/Swan Lake 1.6 0.6%
Interurban/Tillicum 2.6 2.6%
View Royal 2.5 6.0%
Esquimalt 1.3 1.8%
Colwood 0.7 1.0%
Metchosin 0.0 0.0%
Langford/Highlands 2.1 2.2%
Sooke 0.8 3.4%
Juan de Fuca Coast 0.0 0.0%
Royal Oak/Cordova Bay/Prospect 0.6 0.8%
Central Saanich 0.0 0.8%
North Saanich 4.6 2.9%
Sidney 0.0 0.0%
Salt Spring Island 1.2 1.3%
Pender/Galiano/Saturna/Mayne 0.0 0.0%
South Cowichan 2.1 1.0%
Central Cowichan 0.3 0.5%
Source (click in “download the data” below the “geographic” distribution chart
http://www.bccdc.ca/health-info/diseases-conditions/covid-19/data
Bccdc.ca released some color graphics yesterday about Covid 19 cases across the province. Covering the week may 4-10.
Kudos for the effort. But we are spoiled here on HH by high quality charts, and it’s a pity that the bccdc.ca can’t do a better job.
For example, if you look at their “Covid-19” “purple” chart (2nd chart on this link ).
https://www.nsnews.com/bc-news/these-new-maps-show-which-bc-communities-are-covid-19-hot-spots-maps-3773535
They are trying to show where Covid cases are occurring in BC , in shades of purple. The problem is the scale they are using. Most of the province gets the same color (“light purple”), which indicates Covid rates there are between 1 and 50 cases per million people per day. That’s a 50X range, all represented with the same color. But we know from other data that Australia has 1 case per million/day and California has 50 cases/day/million, illustrating what a huge difference this is. Australia is virtually Covid free, whereas California is doing well but still significant Covid problems and under lockdowns. But presumably the Bccdc.ca chart makers would color Australia and California the same “light purple” indicating a similar rate of COVID.
Oh well, that’s why the BC non-government health and epidemiology experts are insisting on getting the raw data, not just these shiny colored charts. And they can make their own analyses and data presentations. As it is now, almost all of Vancouver island is the same light purple color, so we don’t (for example) know if Victoria’s Covid rate for last week is more like Australia or California. Except a few areas with 0 cases, (e.g. Central Saanich, Gulf Islands) which are colored white – great, and it was nice of them to choose a different color to illustrate that important point. But how about some granularity on case rates in the rest of Greater Victoria regions-like putting the numbers onto the map?
“Only place in Victoria that a cop has visited my house because of planting a garden.”
That sounds about right. Also, don’t even think about parking a boat or an RV on your property. And be prepared to get a building permit for just about every imaginable repair or renovation. Oak Bay sounds like a nightmare to me.
From: https://financialpost.com/executive/executive-summary/posthaste-the-backlog-of-debt-put-off-by-pandemic-aid-is-catching-up-with-canadians
If that is the case then we definitely didn’t see the rush for people to buy before the revised stress test rate starting June 1 that some were predicting. be interesting to see what happens afterwards even though I doubt it will have a big impact.
My thought as well. Large majority are flat or up but small number were purchased for well over market value at truly irrational prices. Hope they don’t need to sell anytime soon
I would say yes. Some would be a bit lower, some a bit higher but average would be flat imo.
But the question is what is market right now? prices are all over the place. Maybe the question is If you were to put a random sample of houses that sold in March back on the market now, will the majority retain their sale value?
I don’t know if they will put down pressure on rental prices but certainly prevents upward price pressure and gives renters more options and the ability to look for incentives/deals. Forces more inventory to allow pets, month to month tenancy agreements, etc.
Supply and competition is a good thing in my opinion, whatever the end results may be in terms of the rental prices.
Only place in Victoria that a cop has visited my house because of planting a garden.
Maybe they thought we were growing weed or something?
Guarantee it wasn’t a random visit though.
I’ve physically shown some of these places and usually there is a reason when it appears to sell under market.
Another vote for past peak. 930 Nicholson only went for ask (998), when other suited homes in lake hill have gone over a million. Heck, the last two places on Saanich rd were over a million (I consider Saanich rd less desirable).
I guess technically that part of Nicholson is xmas hill, which means less traffic than the main part of Nicholson since it’s not a through road.
Of course it’s only an annecdote. I don’t know any specifics about that property.
Marko, what are your thoughts of all the new and upcoming condo towers coming on to market downtown? They will also put pressure on existing rental prices assuming everything remains the same.
I think so too given the recent sales below
3969 Sequoia Pl sold for $1.275M (a steal compared to what else sold for around $1.3M in March)
https://victoria.evrealestate.com/ListingDetails/3969-Sequoia-Pl-Saanich-BC-V8N-4N4/872992
4427 Valmont sold $960k (Curious if by end of the year if suited GH houses will go down to $900k)
https://victoria.evrealestate.com/ListingDetails/4427-Valmont-Pl-Saanich-BC-V8N-5R6/873847
Saanich homeowners will face an average tax rate increase of 5.76 per cent this year, an average of $161 per home.
https://www.timescolonist.com/news/local/saanich-homeowners-face-average-161-property-tax-increase-1.24318634
Both still show as active
Could anyone provide update on how much was the sale price of 305, 605 1010 View St. ?
I’m thinking we’re past peak.
Yup. Well researched at this point. “We study the local effects of new market-rate housing in low-income areas using microdata on large apartment buildings, rents, and migration. New buildings decrease rents in nearby units by about 6 percent relative to units slightly farther away or near sites developed later, and they increase in-migration from lowincome areas. We show that new buildings absorb many high-income households and increase the local housing stock substantially.”
https://direct.mit.edu/rest/article/doi/10.1162/rest_a_01055/100977/Local-Effects-of-Large-New-Apartment-Buildings-in
Good luck trying to do that in Oakbay even if you want to, your neighbors will likely report you.
,
,
Most likely to happen in south oak bay, when we sold our house we had a legal accessory building that wasn’t legal for occupancy, and a potential buyer from south oak bay would only make an offer if we legalized it, her agent said he in her last place she had converted her garage as a flex space for her daughter to practice dancing and was reported by her neighbour, too many busy bodies in south oak bay from my experience
The renters aren’t helping the situation either. Every time a rental building is proposed you get a ton of FB comments from renters……”this is going to be $2,000 per month who can afford that????”
What they fail to realize if you approved a boatload of $2,000 per month rental towers the rents would drop to $1,800 and put further pressure on cheaper rentals.
Seems like the concept of supply and demand is not understood by many people.
In the last two weeks I rented out two of my condos. One guy came from a rental building and the minute he gave notice they offered him a larger top floor unit for the same amount he was paying for a small non-top floor unit. He still went with my condo, but due to vacancy in his rental building they were adjusting their prices to keep their tenants.
Then because I didn’t have overwhelming interest in that rental compared to previous years my other rental (10 years old) I decided to allow dogs as I don’t have time to fix it up and I rented it out to someone with a dog which I’ve never done before. If there wasn’t a ton of supply I would have continued to stick with my no pet practice, but the supply modified my practice.
Supply helps immensely, I don’t understand how people don’t get it.
Sometimes I’ll set a deadline on my listings of 4:00 pm for offers and agents will send them in 4:10pm, 4:25pm, etc. so when someone calls me at 3:55 pm asking how many offers I have it can sound vague…”well three realtors have told me they are writing, but I actually don’t have anything in hand.”
This delayed offer buying process simply sucks. It will end soon as the market cools off and we will stop talking about it, I hope.
I’ve only said it 100 times. I don’t know what the incentive would be for me to lie but I’ve never seen a letter truly work and this is coming from a position where I’ve been involved in more transactions than 99% of other agents in the last 10 years.
I thought after I picked on James last week and exposed that it does really come down to money we would have put letters to rest 🙂
Colwood signs deal to build nearly 3,000 homes at Royal Beach
https://vancouverisland.ctvnews.ca/colwood-signs-deal-to-build-nearly-3-000-homes-at-royal-beach-1.5424765
Based on what data? I lived in Oak Bay and never reported my neighbour’s two unauthorized suites, nor felt inclined to and there are about 750 of them in use. 78% of Oak Bay residents support secondary suites and Oak Bay is in process of legalizing them — or at least that is the recommendation before Council.
My view is that if you are causing a nuisance and you don’t deal with it when asked to your neighbours are more likely to report. Parking can be one of the issues.
Highly recommend. Of course you have to have a good relationship, but if you do it’s great.
Not quite, in addition to the no suites policy, your neighbors are much more likely to come down on you as opposed to say Sannich or Victoria.
Surely some suites will be used for ‘aging in place’ by elderly family members. We definitely have that in mind for our place.
Your point? It is the same for any unauthorized suite in any municipality.
nothing stopping your neighbor from telling on you if they get annoyed.
Over 15% of Oak Bay homes already have unauthorized suites – probably a low estimate. (750/4900) https://www.vicnews.com/news/oak-bay-nears-regulation-of-secondary-suites/#:~:text=Oak%20Bay%20is%20estimated%20to,with%20the%20region's%20overall%20growth.
Good luck trying to do that in Oakbay even if you want to, your neighbors will likely report you.
I wouldn’t count out suite potential / existing suite value in higher-end homes. University-age kids in a suite is much better than sharing space with parents. I agree it’s a limited number of families.
A part of the house that can be either used by the owners or rented out but that you don’t have to pay for up front with the purchase price. Like a basement with plumbing and it’s own exit.
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Our 2.5 year old home in Oak Bay is set up with roughed in plumbing and separate entrance for a 1 or 2 bedroom suite, when the kids are gone there wont be much use for the basement but I still wouldn’t consider renting it out given i’d be paying 30% or 40% tax on the income.
Hmm, MLS: 875435 didn’t get the offers it was looking for when it listed a month ago and was pulled after 9 days at 875k and now it’s back at 899k. It will be interesting to see if the strategy works or fails. Or even as a test case to see if the market settling, if it ends up becoming a stagnant listing.
“Ya from a buyer’s perspective everyone is different but if you were ever having to put the house up for resale then an existing suite will fetch a higher price.”
I think the point was that houses with suite potential have unrealized value…that said, they are a target for investors/sweat equity types and command a premium over houses with no suite potential.
Ya from a buyer’s perspective everyone is different but if you were ever having to put the house up for resale then an existing suite will fetch a higher price. Unless it is a luxury home then obviously that is a different story, no one buying in uplands is counting on a 2 bedroom suite rental income to make it work.
You make a good point. The market definitely assigns a higher value to houses with a suite. But from a buyers perspective, you might be better off with an SBNS. What’s an SBNS you say? Why it’s a house with a Suite-But-No-Suite. A part of the house that can be either used by the owners or rented out but that you don’t have to pay for up front with the purchase price. Like a basement with plumbing and it’s own exit.
And people wonder why we have so many real estate investors.
I don’t see how building is ever going to catch up to demand. It’s ironic Victoria is a costal city. Like digging a hole at the beach, as soon as you scoop out the sand, the water just pours back in.
Since 1991 we have added 2062 purpose build rental units in Victoria. In that time population grew by 113,000.
And people wonder why we have so many real estate investors.
Not only that, for the majority of the year it is miserable with windy cold rain and a short window of sun shine on the rare occasion during the few short summer months, because the fog doesn’t lift till 11:00 AM. And, on top of that the #4 Pacific Rim Hwy is a treacherous road that have taken many lives including ambulance drivers a decade ago.
Shouldn’t the question be what is the sustainable price to rent a townhouse in Tofino? 35% or so people rent. If the average worker can rent, that seems sustainable to me. Perhaps you are using the term sustainable in a different context?
Never has been just local demand. A city with only local demand does not exist.
Problem with the argument of “people want to live here therefore the price is justified” is that it doesn’t say anything about what price. What is the sustainable price for a townhouse in Tofino? $800k? $1.4M? $2.4M? $8M? We know Tofino is a nice place, but that doesn’t give us context for price. Spain is also a nice place.
Yes, lets have some context around “massive” immigration.
Well that’s the sort of thing I would expect someone like him to say. Did he back that up from independent sources?
By the way, people moving to the Island from mainland BC and the rest of Canada isn’t “immigration”, unless VI gained independence and I didn’t notice.
Did my own research and read an article about the Tofino sale. Kevin Reid, past president of the Vancouver Island Real Estate Board, stated that “we are experiencing a period of massive immigration” to the Island from others parts of B.C. and Canada. So that’s the explanation, plain and simple. It’s not just local demand and things will probably get worse as travel restrictions are eventually lifted.
Some incite into the Tofino sale (1mil over ask) would be appreciated.
And like $1.5M over a similar sized place 25 feet away that sold 8 months ago. Crazy times
Introvert: That GIF was spot on, kudos for nailing it. It’s a talent.
Someone on this forum bought 4146 cedar Hill I think. I don’t think they are comparable properties as the Kenmore one has a 2 bedroom suite which should demand more value especially in a resale.
I think 1635 looks better. That thing if rented out up and down can probably get anywhere between $4k to $4500 a month. I would throw in the internet for free and put up some fencing (sucks about wood prices right now) to separate the back yard so both suits have dedicated private yard space.
Yeah pretty divergent for two very similar places.
1575 Kenmore: List $1.08M, Sold $1.3M
1635 Kenmore: List $1.3M, $1.288M, $1.088M, Sold $1.085M
Oak Bay’s reaction to West Vancouver managing to lose population:
Interesting. Kenmore went for 1.085 and 4146 Cedar Hill went for 1.045 also under asking. Both 2500 sq feet with a few other differences but comparable.
That Kenmore house that someone had asked about is now pending. Doesn’t look like the bidding war pricing worked as it went for a little less at 1.085M. Unless there is an issue with that house I hate to be the person that paid 1.3m for a crappier house on that Street in March.
https://victoria.evrealestate.com/ListingDetails/1635-Kenmore-Rd-Saanich-BC-V8N-4M8/872901
Amazing article by Frances Bula about the potential of the province to step in and overrule obstructionist cities. We’re getting there https://www.sightline.org/2021/05/10/push-me-pull-you-local-and-provincial-tensions-in-bc-housing-policy/
“With the Conservatives spinning their wheels, the Liberals will continue to enrich themselves.”
Municipal powers are established under provincial statutes, not federal.
“I’m still not sure how a listing agent can be vague about # of offers they’ve received or if there even is other offers, at the time it felt shady”
Cadborosaurus, that’s a total bummer. I’ve written 6 offers for one young couple of been working with. They’ve come in second at least 3 times.
Some listing agents run a better show than others, no doubt. The best ones are very open with the buyer agents and, if possible, without compromising the interests of the sellers, give every buyer an honest shot.
Sometimes, though, you honestly don’t know how many offers you’ll get because buyer agents don’t always submit on time. So, you might have 5 agents saying “yeah, we’re writing,” but you only get 1 offer before the deadline. Then you get 4 all at once, and 2 more trickle in 15 minutes after. It SUCKS for the buyers, but, then again, everything sucks for buyers right now.
Not anytime soon. With the Conservatives spinning their wheels, the Liberals will continue to enrich themselves.
“How do you know it was a bully offer, is that what the seller’s realtor told you?”
If the sellers are waiting to review offers on a given date, any offer that comes in before that is a “bully” offer. The listing agent can’t reveal the details of the offer, but presumably, it’s well over asking price, otherwise the sellers would never consider it.
Another greedy owner…
Tofino home sells for $1 million above asking price
https://www.timescolonist.com/real-estate/tofino-home-sells-for-1-million-above-asking-price-1.24317028
I’m in agreement with you, but spot densification is always going to raise the ire of neighbours because they perceive it as unfair that an exception in their neighbourhood is being considered on a one-off basis. I think it is much better to do what Victoria has done and go through a planning process which leads to rezoning for certain areas and housing densification as a right. This way it is considered and decided and applied fairly in advance of a any development.
Sadly about 20-30% of our population does essentially this. However to better preserve their self images they tend to just deny that climate change even exists, thus absolving themselves of any responsibility to do anything.
does that word mean what you think it does?
You seem to support the current ‘draconian’ (strict or severe) zoning bylaws that severely limit what forms of housing can be built on a property.
Changes to zoning that allowed SFHs as well as other housing forms would be more lenient and flexible.
Protesting homes for other people is antisocial behaviour in my view. I don’t agree in the slightest that it is a normal thing to do.
How would you feel about someone advocating removing all funding for homeless programs because they aren’t homeless? Or advocating taking zero action on climate change because it won’t affect them in their lifetime? All rational from a purely self interest perspective but I think in a society we can expect more from people
Municipal governments exist to make land use decisions. There’s a lot the province can and should do to require this process to be more efficient, but it should not make such decisions unilaterally. Where a provincial government has given itself such power, it’s usually used to help out their friends at the expense of the environment and sound planning. For example:
https://www.cbc.ca/news/canada/toronto/ontario-doug-ford-government-mzos-developers-zoning-orders-1.5832817
Don’t get me wrong — I’m still going to oppose draconian zoning changes today even if the negative consequences won’t be felt for years down the road.
Gotta play the long game.
It is mostly neighbours protesting density. Owners, and some renters, although most renters are more transient and care less. These are the folks who get notices about zoning changes and that they are being consulted. And of course homeowners are going to protest when a local council has control over a variance and the change will change their neighbourhood for the negative in their view and it contravenes the bylaws that were in place when they bought – I don’t blame them at all even if I disagree with it – like 902 Foul Bay. This is normal and they are not the decision-makers, It is the local councils who have the power – and they should probably not be the decision makers if you ever want to see this change.
I biked up Foul Bay Road today and gagged when I saw all the pathetic”save the trees at 902 Foul Bay Road” signs
Exactly. That’s why the fears of it are overblown. Vancouver has zoned capacity for 100,000 carriage houses and builds about 500 a year. Part of that is due to an obstructive process but these are changes with a 5-15 year impact horizon.
Yes, any move for us is minimum 15 years off. We like the schools here and don’t want to uproot the kids until after high school.
Even if Saanich legislates policies that encourage Leo’s fairytale utopia, neighbourhoods aren’t going to change overnight. So there’s no urgency.
So you won’t do a straight up swap now but you would like to leave Sannich for Oak Bay due to potential zoning impacts that may come?
Most smug homeowners I have come across are lower income ones who cannot afford their current place at the current price (“my house gone up by 200k, hell ya I am rich. I now plan to subdivide and make another 500k because I am real estate investment expert “). The well of folks don’t really seem to brag much about it.
China during the pandameic had an app where it showed a real time map of where active and suspected covid cases are. Was this a major factor in controlling infections? I don’t know. Would I like this app for here? Yes I would.
The “neighbourhoods” used have at least 10,000 people. Issues of small communities can be solved by either excluding them from the reported data, or lumping them in with other communities so cases can’t be pinpointed.
The government has no problem publicizing COVID cases of people listing the flight date/time/flight number they were on and the row numbers of concern. That’s just as likely to identify someone as stats about a neighbourhood of 10,000 people (eg View Royal). You’ve likely seen the leaked map, are you able to ID any specific person?
They are as much to blame as the government, if they have a policy on increased population growth then they should have a plan to increase housing supply. As far as this run up goes, current home owners are not to blame, low rates presented a buying opportunity and people piled in as a result focusing only on monthly payments and not other metrics. This will continue to work until it doesn’t
Depends. It’s mostly current homeowners coming out to protest new homes being built. Those owners are definitely partly responsible for the current conditions.
Even if a house on Henderson were to drop to the current value of my house, I ain’t moving.
It’s not worth the wear and tear on the chicken.
So tired of the continual name-calling/scapegoating/blaming. Foreign buyers, then out of town buyers, now greedy smug homeowners.
Current homeowners are not to blame for market conditions. Many are former renters who are grateful they were able to buy despite it pushing them to the edge of affordability when they bought – often with a suite or roommates to make it work. I know we did, and we, at the time, only wished we could have been able to purchase 10 years earlier, but did not resent those that had. Because, you know, they probably had at least ten years less life to live… and all homeowners are always at risk of downturn or major repairs.
You buy and you take a risk on this, but mostly you just need a place to live. It has gotten more expensive in the core areas in purchase price terms, but monthly affordability remains attainable in many areas. What we really need, imo, is way more rent geared to income purpose built housing. People who will never be able to buy need stable housing.
The pandemic has beautifully (for data science nerds) brought to light some of the thorniest ‘collective good vs individual rights’ issues of our times. Sure, as individuals, many of us would benefit from full transparency, knowing neighborhoods, postal codes, etc. where most infections are occurring. We could avoid those places, and use our discretion more effectively to relax some restrictions in less affected areas. But obviously, that would end up violating all sorts of privacy and equity rights of the individuals affected, and be just as likely to backfire, with people convincing themselves they weren’t sick and infecting others, as has occurred all over the world. Just like census data that’s collected from individuals but only publicly available at the sub-regional tract level, no one wants the full dataset in the hands of their neighbours and co-workers.
The Covid data problem is most severe in small communities, where small numbers of cases become instantly associated with the families who were observed to be missing from school, work, etc. Suddenly everyone knows that Johnny and Susie, who missed school for several days and whose family is isolating, are the two under-18s listed as Covid-positive cases, and the family is shunned and blamed for any subsequent transmission.
What some see as paternalistic is actually trying to thread a very fine needle between our charter rights to individual privacy and the collective good of Canadians as a whole.
And by the way – this shit isn’t new. This was the same issue with AIDS a generation ago, measles outbreaks, lice at schools, and plenty of other public health issues.
Patrick, you might be responsible, but there are lots of people who aren’t. I’m not a fan either of paternalistic laws/rules when it comes to things that will largely only impact an individual. I am a fan when it comes to things that impact others (ex. laws against drunk driving). As someone who is responsible and loves having data available, I’m fine being kept in the dark on some things if it mitigates harms brought on by others who lack that responsibility.
I’m just going from the affordability levels and historical behaviour. I agree that it feels hugely overpriced, and maybe I’m not properly taking into account something like the impact of increasing down payments. If I’ve missed something please let me know otherwise I’m just thinking along the same lines as outlined in the articles.
https://househuntvictoria.ca/2021/02/15/when-are-high-prices-a-bubble/
https://househuntvictoria.ca/2021/04/06/dusting-off-the-crystal-ball/
The wildcard is rates. Hard to say if prices can hold roughly steady (and be eaten away by inflation) in the flat rates scenario.
This looks like good value going for 1.25m in Cordova bay
https://victoriarealestategroup.com/featured/755-haliburton-rd-saanich-bc-ca/
This is inevitable in Canada. UK government stepping in to override NIMBYs. https://www.google.ca/amp/s/www.standard.co.uk/homesandproperty/property-news/britain-planning-bill-system-queen-s-speech-b934434.html%3famp
That’s the typical paternalistic/patronizing response like we’ve been getting from the BC government when asking them to share more data. You assume I’m not a “grown-up” like you, and will “throw a party and invite my friends over” if my neighborhood has low cases. So it’s best that we all not be shown the data in the first place.
Since you asked….Here’s the problem with hiding the data…. Infection rates in BC have been much higher within some minority and First Nation groups as well as some high-risk occupations. The leaders within those groups have been kept in the dark about the rates of infections in their communities, and didn’t have time to respond early on, leading to higher rates within those groups. Sharing data with those groups will gain their trust and increase compliance with public health measures and vaccination.
It’s not just me that’s been complaining and wanting more data. It is groups within within other areas of the government, universities, First Nations, and the media. These are professionals and decision makers, like other public health officials, epidemiologists, mayors around BC, UBC bio mathematics professors etc. .
And they don’t just want the shiny, colored graphic , they want the raw data so that they make their own analyses to help their decision making.
Here’s an example article with interviews with a diverse group of health and data professionals within BC and around the country, all calling for more transparency with public health data from our BC government. https://bc.ctvnews.ca/show-your-work-calls-grow-for-greater-covid-19-transparency-in-b-c-1.5378841
I don’t really understand what you would do with this data. If you found out your neighborhood had 0 cases in the last couple days, would you throw a big party and invite all your friends over?
I don’t see how this distrust of health officials will help.
How is this not a bubble and also how can you say there is affordability? I just don’t see it. I really feel for the hard working people out there who can barely afford to rent or own. It is very sad. Lots of greedy and smug homeowners out there right now.
Cadboro when we bought during the lull of spring 2019 we were in a poorly planned bidding war and it actually worked out for us because owners had a tight timeframe and didn’t seem to care to get top dollar?! So I think the bidding wars can backfire especially in a cooling market. Lesson is that it never hurts to try. Now you have the letter and can reuse it.
@ks112 due to the timing of the offer, I guess I could have said “pre-emptive offer”. It was a day after listing when the seller said taking offers 4 days after listing. At least the list agent contacted us to let us shoot our shot, I guess we can’t complain too much.
Cadboro did not say location data is not relevant, they said neighbourhood based data is not relevant (and gave some really good reasons why).
So to make your point about how COVID location data is not relevant, you use COVID location data showing how many cases there are in Calgary vs other cities? Using your logic, wouldn’t the Calgary data be “irrelevant”, and just create “hysteria “ in Calgary and “lack of rule following ” elsewhere ? Why is data by city vital, but neighborhood data irrelevant ? Would you prefer that you didn’t know anything about how many cases Calgary had? Do you also consider neighborhood crime data irrelevant because you work and grocery shop in a different neighborhood?
I don’t find neighbourhood data relevant. By providing it, we could just create hysteria in neighbourhoods with cases, and lack of rule following in neighbourhoods without. Calgary has been providing neighborhood data throughout the Pandemic and now has an infection rate per capita higher than anywhere else in North America.
I live in one neighbourhood, my kid goes to daycare in another and I get my groceries at Costco, in a different city. Reporting that a few of the 50 new cases on the island this weekend were people who sleep in homes in one postal code nevermind where they go during the day for work, food, etc. Would make no difference to my own activities.
It’s shameful how our govt health system has shielded us from basic COVID data. Like uhhh… where are the cases occurring? All we get is the 5 health authorities for the whole province of BC. While other provinces provide the data on a postal code level. They could get away with this when BC COVID levels were low, but now they’re high.
Except when some journalists uncover a “leak” and we see that in fact, the government has been getting the data on a neighborhood level, and just not sharing it. So we finally get a bit of it, such as this leak, telling us today (may 10) that View Royal, Tillicum and Colwood were hotspots for COVID, whereas Oak Bay and North Saanich had ZERO cases. (In the week April 23-28). Has it been like that all along? Or were there other hot spots in our own neighborhoods that they didn’t alert us to? Who here isn’t interest in data like that? And why has our government hid it from us?
See this cool map to see what neighborhoods in Greater Victoria are getting the cases (April 23-28) and note the disclaimer on the chart “not for public distribution”, .
https://www.saanichnews.com/news/leaked-data-shows-view-royal-top-of-covid-19-list-for-greater-victoria/
Fortunately, pressure from citizens and the media have prevailed. And Dr. Henry announced today, that the govt will start sharing neighborhood COVID rates with us plebians. Not today of course, when she announces it with fanfare, but this Wednesday. Well that didn’t take long, only 15 months to wait for this data. I guess we can wait two days more. How many infections could have been saved if we had detailed data of where they were occurring? Like being extra careful in View Royal? Isn’t that a fundamental part of public health, to track infections and inform the public where they are?
It’s my guess that as the “travel bans” are lifted there is going to be a bumb in Victoria prices as out of Province and mainland buyers jump at the chance to buy in Victoria. So for those local discouraged buyers, keep on the buyer trail, battle through and try and find something now!
““legal obligation to disclose if there are other offers”.
In Alberta it is required to inform if there is more than one offer. As a buyer’s agent I ask the selling realtor if there are any other offers. If the answer is “no” I present the offer my clients and I have prepared. If I suspect there may be additional offers I discuss this with my buyers beforehand and prepare an alternate offer to present if other offers materialize. In my opinion it’s better to present a clean offer than one showing changes. It minimizes information given to the seller.
““legal obligation to disclose if there are other offers”. How’s that?”
Half the realtors out there don’t even seem to know what they’re doing, but when you get a Facebook request once a week to “like” a new realtor page because someone you went to high school with just got their license I guess that’s the way it goes…
But is there?
How do you know it was a bully offer, is that what the seller’s realtor told you? I was under the impression that they cannot disclose the details of the offer, so I am not sure if they can even say that the offer is above asking. I’ll let Marko chime in with his expertise.
@Cadborosaurus We put in our first offer last week, a reply to a bully offer. I very much relate to the bitter feeling. Marko will be here soon to tell you heartwarming letters don’t matter. We probably aren’t going to put together any letters, they also can lead to discrimination which isn’t ethically ideal. We will just stick to our guns and eventually either lower our standards or heighten our budget enough to get something! Good luck out there.
“legal obligation to disclose if there are other offers”. How’s that?
More accurate would be to say that they aren’t supposed to lie.
They can’t lie about actually having other offers versus not, but they can certainly be vague about how many and how competitive those are. If they really wanted to be a slime ball they can get their friend to put in an artificial lowball offer that has no chance of being accepted just so they can tell the buyer that there are other offers.
Offered on a place last week (our first time on this rollercoaster!). Was an exciting and also anxiety inducing expirience. We offered asking price with a letter (didn’t have much hope that this would help but hey why not) and were told early afternoon on “reviewing offers day” that there were no other offers. That changed to “might be a few offers” right before the deadline so we increased ours a small amount to what we would max pay. I’m still not sure how a listing agent can be vauge about # of offers they’ve received or if there even is other offers, at the time it felt shady. Also felt like any hope we had was gone and mood shifted quickly to being pretty bitter about writing a letter talking about our family when money & conditions were the only things that mattered. I don’t know if I’d participate in bidding again vs. just making our max offer first and then not moving, we went with asking price because we thought we were not competing and it was a fair amount.
Really hoping the bidding wars fizzle out soon, we were not going to do this until an awesome house came up that the numbers worked on and we thought we stood a chance. I have noticed a few places going for ask or under ask in my searching, and some taking a longer time to have conditions lifted so I assume people are getting inspections, nice small relief vs. the absolute insanity of the past couple months.
Lol, whats your number introvert? It’s $1.23M now.
Well bears were right for the first 5 years. One obvious thing to note is that the average SFH is closely tied to how it cashflows as a rental. Whenever you can get cashflow neutral or positive due to rate decreases and/or rent increases then house price increases follow. It seems like with 20% down a stabilized market will just allow rents to cover the cost of the mortgage and not much more.
Take your average suited house in Sannich, it will go for something like 1.1M now and you can probably get around 4K or a little more for rent, oddly enough that 900k mortgage at a rate of 2.5% is $4K. In spring/summer 2020 that same house was 900k and the monthly payment would have been $3k at 1.7%, so you would have been cashflow positive and as such house prices rose accordingly and eliminated that arbitrage. That same force was at play too during the 2015 to 2017 run up, that was both a increase in rents and lower rates.
Haha. I’m not doing it.
A good thing/bad thing we did (and what lots of people don’t/aren’t able to do): we bought a house that we were very sure would work for us for 20+ years.
Also, inertia.
12-ish years ago:
• Prices of SFHs in the core were in the $500-thousands
• Bears (plentiful) said it was a bubble
Today:
• Prices of SFHs in the core are a million dollars
• No bears anywhere
• Leo doesn’t think it’s a bubble
Good analysis as usual Leo. I do wonder how much inflation impacts affordability even without rate increases if we go by the assumption that lots of buyers are stretched to the limit getting into the current market, also in an inflationary environment wages are the last to catch up.
Introvert, that henderson house just had another price drop btw 😉