In Spain, there are lots of big money condo sales–especially around Puerto Banus. Canada does not hit the headlines for such things normally, but the most expensive condo in all of Canada just sold this week for $28 million (CAD). The penthouse apartment is located in the Four Seasons hotel and residential complex in Toronto, which will be opened later this year.

The condo is over 9,000 square feet and is on the top floor of the 55-story building. It was purchased by an anonymous international buyer and speculation is rife as to who that is.

We all know the real estate market in Vancouver is nuts, but $28 million for a condo in Toronto? That is absolutely nuts! Apparently there are still condos left for sale in the development–a 1,000-square-foot condo, units start at $1.9 million.

So if our mystery buyer wanted to spend his money in and around the Greater Vancouver area, what could he buy? Well he could buy all three of these modestly-priced condos, totaling just over $20 million. Then there would be $8 million to splash out on Ferraris, a Lamborghini or two, a yacht, a race horse and a small plane.

Here’s just a sample of modest yet luxurious condos around the Greater Vancouver area:

$15.5 million – 7 bedroom, 7 bathroom condo in Vancouver’s exclusive Coal Harbour at 1077 W Cordova Street Vancouver. Almost half the price of the Toronto condo but

$3.8 million – 2 bedroom, 3 bathroom condo, also in Vancouver’s Coal Harbour at 1409 W Pender Street Vancouver. You could buy seven of these!

$960,000 – Want something out of the city? How about this brand new (2012) 3 bedroom, 3 bathroom luxury condo in Port Moody, BC at 301 Capilano Road Port Moody. Yes, you could buy 28 of these. One for each of your ladies, siblings, or whatever.

If you need further talking out of splurging $28 million on one condo then just imagine the Realtor fees on it! Unless the sellers are using one of those flat fee real estate realtors, they are going to be spending a whole lot on fees. Also, how much are the property taxes on that thing? Maintenance fees would also be monstrous. I imagine those too would be in the $100k range. So along with forking out $28 million, the new owner will also be coughing up a handsome sum every month on property taxes, maintenance fees, and cleaning fees. Vacuuming the 2,500-square-foot master suite alone would take a week!

Property Sales - Real Estate Vancouver

Luxury real estate is booming in Vancouver, BC, Canada according to an article in a local newspaper called the Vancouver Sun. This seems strange when you look at the proximity of Vancouver to the U.S. Are things in that part of Canada so much better than say, Seattle? Washington is feeling the recession that is hitting the U.S. and a lot of other countries around the world, yet the difference between these two neighboring cities  is startling.

In Vancouver a record 375 homes — including nearly 50 condos — sold for over $3-million in 2010, 73 homes of those sold for over $5 million.. Many think that Vancouver’s housing prices are overdue for a major price adjustment. Most of the prices homes were sold on Vancouver’s west side; the most expensive was $17.5-million, the second and third most expensive sold for $11-million.

The Vancouver Sun stated that the market for luxury homes is now “insanely hot”. It also says that globally, Vancouver is still seen as a relatively good bargain.

Mainland Chinese buyers are the primary purchasers fueling this hot real estate market. The problem is though that local people are being priced out of the market. As the luxury properties are being snapped up by wealthy foreigners, the choice for locals with money gets less and less and the further down the food chain it is difficult for first-time home owners to get on the property market.

So is there value in Vancouver for first time buyers? You will not find value in downtown Vancouver, but further out, along the excellent transit system called the Skytrain, you can find value.

Here are just a few examples of value in the real estate market in some areas of Greater Vancouver:

Fraser Heights, Surrey Real Estate

We now travel across the river Fraser to see some examples of value in the real estate market. If you are looking for more space, yet want to stay close to Vancouver then this is the place for you. Fraser Heights real estate includes some houses on huge lots.

Port Moody, BC Real Estate

Just 45 minutes drive from downtown Vancouver, Port Moody also offers its residents the convenience of commuting from the West Coast Express, buses and Evergreen Skytrain line. Real estate in Port Moody is great value, especially the types of Port Moody Condos on offer today. The scenery there is amazing.

Burnaby, BC Real Estate

Burnaby, BC is on of the more up-and-coming neighborhoods in Greater Vancouver. If you love shopping, then you will feel at home in Burnaby, it is home to Metrotown–the biggest mall in BC. It is also home to Brentwood Mall, and Lougheed Town Center Mall. Burnaby real estate features lots of tower blocks as well as low-rise condos and townhouses.

Brentwood Park, Burnaby, Real Estate

This suburb of Burnaby is just 20 minutes from downtown Vancouver. Brentwood Park real estate consists mostly of single-family dwellings, but there are a number of high-rise and low-rise buildings in it the neighborhood. The good news is that there are several new condo towers planned for the south edge of the Brentwood Park area, along the Skytrain tracks. There is some excellent real estate examples in this neighborhood.

For more information on real estate prices, trends and news for all these areas, check out the Real estate board of Greater Vancouver REBGV website.

Read the Vancouver Sun article “Luxury real estate booming in Vancouver” on their website.

Image: vancouversun.com

Vancouver just celebrated the one year anniversary of the 2010 Winter Olympic Games any there is still a linger Olympic news story in the media there–condos in the huge development used to house the athletes are back on sale, for the third time. There was huge controversy about the village all the way from planning, through development and construction and financing. The City of Vancouver ended up taking over the loan after the developers went bankrupt, and tax payers are stuck with a $740 million tab. The Olympic Village was put into receivership in November 2010 with the City of Vancouver later announcing that it had negotiated an agreement with Ernst and Young to assume control of the village.

Real estate marketers have been given the task of selling these condos, and the idea that they are a great buy. Prices have been slashed by up to 50%. Prices now start at $329,900 for a studio apartment. See full price sheet below:

Vancouver Condo Prices:

Still, even with such price reductions, this does not appear to be great value. There are rumors of problems within the condos, and initially there were reports of building inspectors getting turned away. It will be interesting to see how many of the condo units in the development end up getting sold. The real estate market in Vancouver has slowed significantly, but the fact that these condos are so hard to sell has nothing to do with real estate market conditions.

Apartments and condo developments seem to have no trouble selling in other parts of Greater Vancouver: Burnaby, New Westminster and other satellite towns are all in a real estate hot streak. There are condos for sale in Port Moody for instance that only stay on the market a few weeks, and even less time in other instances. Whatever the situation is, there certainly seems to be a dark cloud hanging over the Olympic Village (from a quote in today’s Province Newspaper about the saga).

Check out the marketing website for the Olympic Village–now renamed ‘The Village on False Creek‘.

Evidence of how big the real estate bubble was in Ireland–recent numbers show that residential property prices are down 38 per cent since prices peaked at the end of 2006. Ireland’s “Celtic Tiger” was roaring all the way to the last quarter of 2006, and the real estate bubble was at its peak around that time. Then a series of unfortunate global circumstances, coupled with incompetent government decisions, pulled the rug from the Tiger and the results meant that the bubble was truly burst, and the economy was in a shambles.

The numbers were released in the latest house price index from Permanent TSB (a building society) and the Economic and Social Research Institute (ESRI). The index is based on the agreed sale price and is calculated using data from mortgage drawdowns, and indicates property prices are now back to 2002 levels. The average price for a house nationally in the fourth quarter of 2010 was €191,776 (Euro) compared to €311,078(Euro) at the peak of the boom.

For those lucky enough to get mortgage approval, it is now virtually as cheap to buy a house in Ireland as it is to rent one. Experts say it is unlikely the housing market would bounce back this year and that there would be a very subdued property and mortgage market in 2011.

For more news and educated opinion on the state of the Irish real estate market, check out the Irish Times Property section. It makes for harrowing reading.

So, with what we know from the mistakes of other countries, could there be a similar property bubble and bust story for other countries in the next few years? Australia is always in a sentence with the words “property bubble” these days. The US property market is a mess, but just North of the border the Canadian real estate market is booming. A case in point, the property market in Vancouver is booming, yet just 40 minutes drive down the road in Washington State, foreclosures are constantly in the news.

Let’s hope that the Irish story does not get repeated in Canada.

Property Sales - Real Estate Review 2010

2010 was a mixed year for real estate all over the world. A recent report by ScotiaBank Group, based in Canada gave a good summary of real estate trends around the world in 2010. Some housing markets crashed, while some boomed.

Australia’s real estate market was the clear success story in 2010. Housing demand was supported by low unemployment, while tight supply added to the increase in property prices.

Other countries’ real estate markets did not do so well in 2010: In Asia, Japan’s twenty year long property slump continues.

In Europe, conditions were mixed, with housing activity in the core nations generally holding up better than in the periphery:

The U.K. real estate market staged a strong recovery in early 2010, although this has slowed slightly towards the end of the year.

Germany’s housing slump may finally have come to an end. High exports and lox unemployment helped the economy.

France, Switzerland and Sweden all faired well in terms of real estate, but other European countries such as Spain, Italy and Ireland all had a terrible year in terms of price drops. Ireland’s real estate market probably did worst, housing oversupply and high unemployment, gave the rest of the world a look at how a real estate bubble finally bursts.

The U.S. real estate market did not recover much from 2009. 2011 will hopefully be a better year for the property market there.

Canada’s Real Estate Market

Canada was up there with Australia in terms of a red-hot property market. Canada had one of the better performing housing markets in 2010. Low mortgage rates have continued to be a key factor leading to renewed strength in the residential housing market in Canada.

Canadian real estate sales started strong in early 2010, and also towards the end of the year; sales of existing homes in Canada rose for a fourth straight month in November.
The Canadian Real Estate Association (CREA) confirmed that a total of 37,658 homes changed hands in November 2010.

Monthly sales increases were reported in core markets such Calgary, Edmonton, and Montreal. The country’s two biggest real estate markets also had big increases in November, with Toronto and the Greater Vancouver Area having the highest property sales increases.

Let’s focus on BC, Canada where the Greater Vancouver Area had the biggest sales increase in November at 11.3 per cent. Apart from Vancouver itself, there were some positive signs: Port Moody real estate showed big increases in sales, as did other parts of the Lower mainland. The Burnaby real estate market showed positive increases across the board, but areas further out such as Abbotsford slowed slightly.

So is there a bubble waiting to happen in Canadian real estate? Vancouver condos are an example of how hot and possibly overinflated the real estate market is in BC. A 400 sq. ft. one bedroom condo in downtown Vancouver can go for $500,000 or more.

So what will 2011 bring us? Mixed numbers from around the world show us that there are never any constants. A year can make a big difference.

Happy New Year to all our readers.

Most of these media reports are based on reports by the Real Estate Board of Greater Vancouver and Re/Max (who also have the interests real estate agents at heart). House prices in Greater Vancouver should rise 12 per cent this year and five per cent in 2011 according to Re/Max.

Re/Max also stated that the real estate market in 2011 will be “vibrant” as an estimated 40,000 people — mainly from Asia — are expected to settle in the region. Not sure where they are getting this figure, but that’s saying that locals are probably priced out of the market by the wave of wealthy immigrants.

All this is just feeding the frenzy of news articles getting regurgitated in the media lately. There seems to be a positive spin in all these stories but no one is really focusing on the downside. Higher prices mean bigger mortgages and when people are still on salaries that have not risen the same way, then there’s an obvious problem.

Prices rising means over-inflated prices, which means bigger mortgages, which means reckless lending. This is standard property bubble stuff. This has happened in the US and lots of European countries. Canada’s banks will be left with the bad debts, then the government will have to bail them out, then the tax payer will have to pay for it. Just read the news headlines from Ireland from the last few weeks.

Sources:

http://www.vancouverpropertynews.com/vancouver-property-prices-keep-rising/16/

http://www.cbc.ca/canada/british-columbia/story/2010/12/02/bc-vancouver-real-estate-november.html

http://www.theprovince.com/business/Vancouver+house+prices+keep+rising/3944189/story.html

The Vancouver Sun recently had an article saying “B.C. housing sales forecast to drop 12 per cent in 2010″ with a subheading of “BCREA fall housing forecast predicts small boost in sales in 2011″. Having a headline with the words “drop” and “sales boost” within a line of each other only serves to confuse the regular reader.

The BCREA, quoted in the article as predicting a sales boost in 2011, is the B.C. Real Estate Association, and their interests are those of the real estate agents. Without a doubt their interests is to encourage sales in the industry. They want to get the word out that everything is rosy in the Greater Vancouver property market.

The Globe and Mail’s headline read “CREA slashes home-sales forecast”, but the actual press release circulated by the CREA (Canadian Real Estate Association) read “Moderate Rise in Home Sales Forecast”. This is quite a turnaround by the Globe and Mail. Confused? Me too.

Other organizations and financial institutions are also giving mixed messages. The Bank of Canada warned that Canadian household debt is too high and gave a more pessimistic outlook. If you check any of the Vancouver real estate agent’s websites they will tell you that the market is hot right now. “Vancouver Real Estate Market to Remain Strong” is just one headline we encountered recently.

Anyone interested in the Greater Vancouver property market, whether buying or selling a property should research material from every spectrum of the media.

Read more on the Vancouver real estate market here:

http://www.vancouversun.com/business/housing+sales+forecast+drop+cent+2010/3807350/story.html

http://www.theglobeandmail.com/report-on-business/economy/crea-slashes-home-sales-forecast/article1786967/

http://www.bcrea.bc.ca/news_room/2010-11-10Forecast.pdf

Sales of existing homes in Canada rose in October from September, climbing for a third straight month, according to the Canadian Real Estate Association. Sales levels in Lower Mainland real estate markets remain somewhere between the highs of 2009′s market rebound and the lows of 2008′s property sales collapse – although ‘collapse’ might be too strong a statement.

A new report by the CMHC also suggests that low mortgage rates combined with a growing population and an improving economy bode well for Metro Vancouver home sales for the rest of 2010 and 2011. Also Condominiums have become a hot sector of the Canadian real estate market, particularly as an option for first-time homebuyers spooked by high prices for single-family homes.

When reading such reports, you have to keep in mind where they came from. Real estate agents want you to buy, buy, buy, while it’s also in the government’s interest to keep the market ticking over. One of the most important things to think about are affordability and interest rates – can you afford the repayments if the interest rates go up?

Source: http://www.vancouversun.com/business/real-estate/index.html

vancouver real estate

Canada Real Estate Report: On Canada’s west coast, the province of British Columbia, or BC, continues to grow economically as other parts of the world experience a recession. BC’s biggest city is Vancouver which is located in the Lower Mainland of the province. Vancouver has a population of over 578,000 according to the 2006 census; the surrounding metropolitan area however has a population of over 2.1 million. This is the largest metropolitan area in Western Canada, and third largest in Canada. The metro area includes the cities of Richmond, Burnaby, New Westminster, Surrey, Coquitlam, Port Moody, and others.

The Vancouver real estate market is super hot in comparison to the US real estate market, which has tanked in the last year or so. The property market in the city and all around the metro area continues to buck trends.The prices of condos in downtown Vancouver have grown out of the reach of many first-time buyers. A 500 square foot, 1 bedroom apartment in the downtown area can go for over half a million dollars these days. More and more people are looking to Burnaby, New Westminster and the Tri-City area of the Lower Mainland to find more reasonably-priced property.

Finding a suitable property for the right price takes research, knowledge and dedication. One well-known realtor in the area is Kristy Mattiazzo. She is a valuable information source for local real estate listings. Kristy’s success in the Vancouver real estate business has earned her a Director’s Award at Sutton Centre Realty. Kristy offers expert real estate services for Burnaby, Vancouver, Coquitlam, Port Coquitlam, Port Moody and New Westminster.

Kristy’s website – privatepropertyrealty.com – has property listings all around the Vancouver metro area. Condo prices in Port Moody BC are really good value right now. Coquitlam property prices are also great value, and the choice of property on the market there is excellent. Kristy told us that she expects property values to hold strong and even increase slightly in the coming year.

All around, it seems that British Columbia, and particularly Vancouver and the surrounding cities is great value for property investments.

Is the property bubble about to burst?

A recent article in the Economist magazine stated that houses around the world are extremely over-valued. This is the case in some countries more than others. The recent property bubble bust in Ireland, Spain and some other countries highlights this; where mortgages were given out on properties that were not worth the financed amount.

The Economist listed countries with the most over-valued property prices. The scale ranged from Australia at the high end, where homes are 63.2 per cent overvalued, to Japan at the low end, where houses are 34.6 per cent undervalued.

The Economist’s analysis of “fair value” of housing is based on comparing the ratio of current house prices to rents, with the long term average. The purchase price of a house is divided by the rent it could have earned per year, and the result is the price-to-rents ratio.

A low number means a house could be undervalued and a high result could mean it is overvalued.

Here are the results of The Economist survey of over-valued countries:

• Singapore: 19.2 per cent
• Hong Kong: 58.1
• Australia: 63.2
• China: 18.1
• Sweden: 41.5
• Belgium: 21.6
• France: 42.5
• Canada: 23.9
• Netherlands: 23.6
• U.S.: 4.6
• Denmark: 19.4
• New Zealand: 20.2
• Britain: 32
• Italy: 10.5
• Spain: 47.6
• Ireland: 13.2

For example, on this list, real estate in Canada costs on average 23.9 per cent more than it is worth. That’s around the middle of the list. The report stated that Canada’s property prices were up 4.5 per cent from one year earlier. And between 1997 and 2010, prices rose a whopping 70 per cent. There have been rumors of a property bubble in Canada for a number of years now, and only time will tell whether the bubble will burst.