Tuesday, December 18, 2007

Canadian Real Estate Sets Another Record

Real Estate in Canada has set new levels for sales ina year by sales volume and dollar amount.

Canadian real-estate markets clinch early record

Derek Abma, CanWest News Service Published: Monday, December 17, 2007
OTTAWA -- With one month's activity still unaccounted for, the Canadian Real Estate Association said Monday that listed residential real-estate transactions in most major markets are already at record levels.

Data from the country's 25 biggest markets show 345,577 sales of existing homes in November through the Multiple Listing Service (MLS), which is 2.7% ahead of the previous record of 336,646 sales in 2005.

There was a seasonally adjusted level of 29,992 sales last month, up 3.2% from October. This was driven by increased activity in Vancouver, Toronto, Edmonton, Calgary and Saskatoon, CREA said. On an unadjusted basis, November sales were up 7.6% from a year earlier.

A monthly record for sales was reached in Newfoundland and Labrador, the second-highest number of monthly sales was recorded in Saskatoon and Regina, and Vancouver and Toronto both had their third-most sales ever in November.

"Sales activity continues to run strong, even if it is off its peak set earlier this year in nearly all major markets," CREA chief economist Gregory Klump said in a statement. "Demand remains strong due to continuing job and income growth, and upbeat consumer confidence. That is helping retain a seller's market in most major markets."

The average sale price was $332,807 last month, up 11.6% from a year earlier. That marked the seventh-straight month that prices were up more than 10%. Average-price records were set in Montreal, Quebec City, Victoria and Kitchener-Waterloo, Ont.

BMO Capital Markets Economics said these numbers "show that resale activity barely blinked in the face of the severe credit squalls in the fall."
Financial Post Article.

Go Canada.

Wednesday, November 28, 2007

A Nation Wide FSBO Company Is Expanding Efforts In Western Canada

A nation wide FSBO company is expanding efforts in Western Canada, at twice the price of Snap Up Real Estate. Canadian real estate is currently home to many 'for sale by owner' companies, DuProprio is one of the largest.

DuProprio has representatives in the Maritimes, Manitoba and B.C., but is waiting before jumping into Alberta, where two competitors are already active. Online services WeList.com and comfree.com are active in several Canadian provinces. For sellers, the website works like this: they pay a flat fee up front that varies according to location and type of property. The average fee is $400. (This will rise to $500 next year.) That fee buys sellers a website listing of six months to one year, depending on the type of property, and photos taken by a professional.Sellers get a customized poster for their lawn and online tools to help them write a description, prepare their home for sale and negotiate. A DuProprio sales representative visits about 90 per cent of clients to help set up a listing. Bouchard and his team talk to clients and the public through their blog. Article.

The expansion of 'For Sale By Owner' real estate transactions is growing, which is good for economic diversity.

Friday, November 16, 2007

By All Accounts Real Estate In Canada Will Not Follow The Dismal Path Of US Real Estate

By all accounts real estate in Canada will not follow the dismal path of US Real Estate. Financial analysts at TD have projected healthy growth in Canadian real estate for the next 25 years. As well the same firm reports Canada in unlikely to have mortgage trouble like the US.

Zillow.com, a huge, but newer, US real estate website has inked deals with several newspapers on advertising ventures. Full article.

Snap Up Real Estate Has A New Premium Listing In Nova Scotia

Snap Up Real Estate has a new premium listing in Nova Scotia. Real Estate in Nova Scotia is some of the most affordable in Canada, and this property is no different. Nova Scotia is one of the oldest settled areas of Canada, communities are well established and locals are renowned for their friendliness. Check out the full property details --> Nine Mile River Real Estate For Sale.

Wednesday, November 07, 2007

Real Estate In Canada Is Slowing Down, But We Will Not See The Crash Some Regional Markets In The US Experienced

Real estate in Canada is slowing down, but we will not see the crash some regional markets in the US experienced.

Industry insiders are reporting that Canadian real estate will not be adversely affected by the high dollar or the poor US real estate market. Also check the Canadian market update by CNW Group News.

Condo high rises are still a big hit with Vancouver real estate investors. A recent high rise in Surrey sold out in 30 hours, setting a new record.

Condo buyers have set a new speed record in real estate sales in the Lower Mainland by snapping up all 901 units in a Surrey high-rise development in just 30 hours.

A record 545 units in the Sky Towers development were sold last Saturday, beating the previous one-day sale record of 536 sold at the Woodward's development in Vancouver's Downtown Eastside in April, 2006.

The final 356 condos sold on Sunday for prices starting at $179,900, half the cost of similar units in Vancouver, with total sales for the weekend reaching $280-million.

Sky Towers, which includes two high-rises of 36- and 40-storeys, will be the tallest of their type between Vancouver and Calgary. The project is being built by Korean developer Hee Yong Yang and is his second complex in the area. Mr. Yang, the founder of a 2,000-outlet fried-chicken franchise in South Korea, moved to Vancouver with his family in 2002.

Globe and mail has the story.

Tuesday, October 30, 2007

The Victoria, BC Real Estate Market Has Been Compared To Calgary's For It's Upward Trends

It seems as though Real Estate in Canada has not been changed by the slowdown in the US housing market, or the rise in the CDN dollar. The Victoria, BC real estate market has been compared to Calgary's for it's upward trends. Article.

People are willing to pay extra for 'green' homes. Good on you real estate buyers, but is it really greener? Article.

Pro athletes have tonnes of money, so real estate investing is easy for them right. Article.

The change in US real estate trends has made for a buyers market in many states and regions. One great place to invest would be Florida. They are overstocked, but not under priced. Yet.

Wednesday, October 24, 2007

Real Estate In Canada Will Not Follow The Same Path As The US

Real Estate in Canada will not follow the same path as the US. Good for us and bad for us. The downturn in US real estate means we have no market for our now expensive exports of lumber, yet our economy is okay, for now. Article from Globe and Mail.

Wednesday, October 17, 2007

How To Stage Your Home For Potential Buyers

Check out this blog that is giving tips on how to stage your home for potential buyers. There is a multitude of tips, plus examples in the form of photographs to show you the concepts. You can use these tips to sell your home FSBO.

Realtors Feel It Is In The Best Interests Of Canadians To Own More Homes

Wow, Realtors feel it is in the best interests of Canadians to own more homes. And who would benefit from such a thing. Surely not real estate agents? Although home ownership is positive economically the CREA is pushing the federal government to fight homelessness. Read on Below.

OTTAWA, Oct. 16 /CNW Telbec/ - The Canadian Real Estate Association will
be paying close attention to the Harper government's unveiling of its new
priorities, which are to be outlined in the upcoming Speech from the Throne.
"We hope to see this federal government recognize and assume its shared
responsibility in the development of sound policies for Canada's housing
sector," said Pierre Beauchamp, Chief Executive Officer for The Canadian Real Estate Association. "This Throne Speech represents a great opportunity to address the needs of this important segment of our economy."

REALTORS(R) have been advocating for the development of a national
housing policy where important concerns such as homelessness and the need for radical changes for First Nations housing would be dealt with at the federal

REALTORS(R) have also called for the implementation of much needed fiscal
policies aimed at encouraging investment in real property and an increase in
homeownership for Canadians. Such measures include a capital gains tax
rollover for real property investments and a loan limit increase for Canada's
Homebuyers' Plan loan, which targets first-time homebuyers.

The Canadian Real Estate Association (CREA) is one of Canada's largest
single-industry trade Associations, and represents more than 92,000
REALTORS (R) across Canada. CREA's primary mission is to represent its members at the federal level of government. CREA also works to defend the public's right to own and enjoy property.

Please note representatives of The Canadian Real Estate Association will
be available for comment following the Throne Speech October 16th.

Wednesday, October 03, 2007

Snap Up Real Estate Has Added A New Real Estate Site

Snap Up Real Estate has added a new site. http://www.SNAPUPREALESTATE.COM/.
That is correct we now cover The US and Canada.
Real Estate has never been so easy.

Friday, September 21, 2007

Real Estate In Northern Washington State Has Not Seen The Same Downturn The Rest Of The US Has

Real Estate in Northern Washington State has not seen the same downturn the rest of the US has. The reason, Canadian buyers. With the Canadian Dollar at record highs people looking for real estate from the lower mainland and Alberta have turned to cheaper vacation homes in the States. People are buying now for future retirement, as there is no guarantee on the dollar staying strong.
Full Article.

Boomers look south for retirement homesWashington market seeing growing interest

By Monte Stewart - Business EdgePublished: 09/21/2007 - Vol. 7, No. 19
As the loonie remains strong, Canadian homebuyers are flocking south of the border to purchase future retirement homes.

U.S. real estate industry professionals in border locales - particularly in the West - say sales to Canadians are on the rise in recent months as Canuck Baby Boomers buy weekend and summer getaways and investment properties that they will use more during retirement.

Meanwhile, American developers are seeing higher interest from Canadians on projects that are in the works.

"About 70 per cent of our buyers, for the last three, four months have been from Canada - Vancouver in particular," says Mike Kent, a realtor who focuses on Birch Bay, Wash., just south of Vancouver.

Kent, a Birch Bay resident who sells for Blaine, Wash.-based Windermere Real Estate, says Canadian buyers follow a general trend in the U.S., where buyers are purchasing retirement homes now before they get beyond their reach and using the homes as rental properties to offset the cost before they stop working.

"It's made Whatcom County the exception to the downturn in (U.S.) real estate overall," says Kent. "We're experiencing about a four- to five-per-cent increase in average price, versus most areas that are experiencing either flat (numbers) or a decline."

Birch Bay, a popular haven for Vancouverites, was predominantly under Canadian ownership during the 1960s and '70s, but Canadians stayed home in the 1980s and 1990s as the Canuck buck faltered.

Kent, who was born in Portland, Ore., but spent his school-age years in North Vancouver and West Vancouver, says current times are reminiscent of when his family and others took advantage of a Canadian dollar that was then higher than its U.S. counterpart.

"Two things have happened," said Kent. "Your dollar has strengthened against our U.S. dollar. And second-home property options in British Columbia have become so expensive - Kelowna, Victoria and the like - that (buyers) realize they can find houses across the border for typically one-third to one-half of the price of a comparable property there.

"They've learned how to work with the border better, whether it be with a Nexus card (which allows for fast passes through customs) or schedules."

He says the development in which he lives has been able to maintain the same number of sales in a market that has more inventory because of increased Canadian demand. Most deals result from referrals from other Canadians who have lived there.

"It gives them the confidence level that they're looking for," he says. "They're not the first chicken through the fence. That helps a great deal."

Most of the Canadians he deals with are from Vancouver or other parts of B.C. He has had some inquiries from Albertans, but no sales yet.

The increased Canadian interest in homes has also sparked an increase in retail and commercial developments, he adds.

Fred Bovenkamp and Craig Anderson, who are marketing and developing the 200-acre single- and multi-family Horizon project near Birch Bay, say Canadian interest in their project has exceeded their expectations. They base their comments on pre-sale registrations from prospective buyers in advance of sales that launch in October.

"Initially, we didn't think we'd probably see 20 per cent (Canadian ownership)," says Bovenkamp, owner of Bellingham-based FW Bovenkamp Ventures.

"As we see the Canadian dollar strengthening, we see that number changing a little bit. (Because of) the initial feedback that we're getting from people, we hope to get maybe 30 to 40 per cent, if it's possible."

Like Kent, Bovenkamp attributes the higher Canadian interest to lower prices in Washington than B.C. Quarter- and half-acre lot prices in the first phase at Horizon ranged from $288,500 to $538,500.

He says Whatcom County realtors and developers have made "a real marketing push" into Vancouver and other parts of the Lower Mainland and those efforts are now starting to bear results, although it's likely Seattle-area residents will make up the bulk of buyers.

Anderson, marketing director for Pilothouse Real Estate Inc., based in the Vancouver suburb of New Westminster, expects the development to appeal to high income-earning Canadians, such as National Hockey League players, who live in the U.S. for tax reasons and must meet minimum annual-residency requirements.

"The border has become less of an issue for people," says Anderson.

Meanwhile, Albertans are also starting to show more interest in Montana, says Peggy Sue Amelon, a realtor with Re/Max of Whitefish.

"I'm noticing a lot more Internet leads coming in from Canada from your 403," says Amelon, referring to the telephone area code for southern Alberta. "I've been getting a lot of that within the last two or three months."

Since Internet leads usually take about a year to carry out, she says not many new Alberta buyers have actually moved into homes in Whitefish yet.

"There's still a bit of a sense that we have a slowdown," she says. "But I do believe that that dollar change is huge as far as bringing Canadians to this area. I've been here 22 years and I know they were kind of a driving force for a lot of the properties here.

"A lot of these older subdivisions in Whitefish were created, in a lot of cases, for vacation properties ... It was typically Canadians who were going to be down here for the summer or winter."

Amelon is waiting to see what effect the stronger loonie will have over the long term.
"The general market is a little nervous right now," says Amelon. "Buyers don't know what they should pay and sellers don't know what they should sell for.

"There's not a lot of confidence in what to do with real estate right now whereas, about three years ago, everybody was buying whatever."

Wednesday, September 12, 2007

Snap Up Real Estate Has So Much To Offer

Snap Up Real Estate now has 13 province pages and 22 city pages. With each new page added the website grows the available content for the user. The latest additions to the city pages index have been Halifax, Vernon, and Moose Jaw. The current projection is that by the end of 2007 Snap Up Real Estate will have 50 cities available to users.

Also newsworthy is that SnapUpRealEstate.com will soon be launched. The US is a huge market, and we are looking forward to servicing American clients.

Tuesday, September 11, 2007

Calgary Real Estate Market May Be In Trouble

The Calgary real estate may be in trouble. In the last few month the inventory in the city has been rising at a steady rate, will purchases of real estate have dropped off. The Calgary Herald reports that house prices have plummeted in just one month, and good luck in selling with a growing inventory. Read the Herald article below.

House prices plunge $20,000
Red-hot market chills in August

Mario Toneguzzi
Calgary Herald

Calgary's resale housing market, which has set a scorching pace for the past two years, has dramatically cooled, with the average price for single-family homes plunging by about $20,000 in August, according to a local realtor.

The average sale price dropped primarily because of a decline in the sales of luxury homes, those over a million dollars.

According to preliminary figures from Calgary realtor Bob Truman, of First Place Realty, the average sale price of a single-family home in August was $485,566 -- down from the record high of $505,920 set in July.

The median price dropped in August to $430,000 from $435,000 in July. It was $439,000 in June.

Truman said Wednesday that the average sale price in August was affected by the number of sales in the million-dollar-plus category.

In August, he said, 38 homes sold for more than $1 million at an average sale price of $1.5 million.

This compares with 61 sales in the upper-end market in July with an average sale price of $1.7 million.

Official Multiple Listing Service data for the month of August is expected to be released today by the Calgary Real Estate Board.

"If you get rid of the million-dollar sales . . . and compare them month to month, well August was down $2,000 compared to July," Truman said of the average sale prices for single-family homes.

There were fewer million-dollar sales in August and that skewed the average price, he said.
"But if you look at the median price, it was only down by $5,000 and that means the same thing: there were fewer million-dollar sales."

For August, there were 1,318 sales in the single-family home category while there were 598 sales of condominiums. In August, the average sale price of condos was $320,790 -- a slight increase from the $318,582 in July.

"My guess is that when people see the average price go down so much, they're going to hold off probably on buying until they see it stop, right, and then the floodgates will open again when they see it turn around," said Truman.

According to Truman's website, the average sale price of a single-family home in the past seven days, as of Tuesday, was $480,766 and the average sale price on Sept. 30, 2006, was $426,690.

In Edmonton, where real estate had also been climbing fast, the same sag in the market is being seen.

Edmonton-area home prices fell almost $10,000 in August -- the deepest drop in the city's history.

The $344,792 average, for all forms of housing, was down 2.8 per cent from July.

Friday, September 07, 2007

Real Estate Problems Are Getting Worse In The United States

Real estate problems are getting worse in the United States. Mortgages are being defaulted at a rate never seen before, the this is still the first wave of sub-prime mortgages. The real problems will occur when the meat and potatoes of the sub-prime renewals hit in mid 2008. Hold on for the recession south of the border. Full details.

Mortgage woes push foreclosures to record high
Subprime loan problems seen hitting homeowners

The Associated Press

WASHINGTON - Homeowners, struggling to deal with sharp increases in their adjustable mortgage payments, got hit with a record number of foreclosure notices in the spring as the crisis in subprime lending intensified.

The problem was the most severe in the industrial Midwest and former housing boom areas such as California and Florida, but economists warned the situation will get worse in coming months as an estimated 2 million adjustable rate mortgages taken out with low introductory interest rates reset to much higher rates.

The crisis is most severe in subprime mortgages, loans provided to borrowers with weak credit, but it is now spreading to other types of mortgages, according to a quarterly report released Thursday by the Mortgage Bankers Association.

That report showed the number of homeowners who got foreclosure notices in the April-June quarter hit an all-time high of 0.65 percent, up from 0.58 percent in the first three months of the year. It marked the third consecutive quarter that a new record has been set.

The rising defaults in subprime mortgages have roiled global financial markets in recent weeks, sending stock prices on a roller-coaster ride as investors wonder which big bank or hedge fund will be the next to report huge losses from subprime mortgages that were bundled into securities and resold to investors.

Both President Bush and Federal Reserve Chairman Ben Bernanke tried to calm fears late last week. Bernanke pledged the central bank would “act as needed” to limit any adverse economic effects from the market turmoil.

Bush announced changes in the Federal Home Administration insured-loan program to help combat the expected wave of foreclosures and also answer attacks from Democrats that his administration has been slow to respond to a growing crisis in mortgage foreclosures.

Democrats criticized Bush for not going far enough and vowed to push more aggressive legislation through Congress, not only to help homeowners facing foreclosure but also to attack predatory lending practices they contend led to the crisis.

Sen. Charles Schumer, the chairman of the Joint Economic Committee, said the new mortgage delinquency numbers should serve as a wake-up call to Congress and the administration that urgent help is needed. Schumer is seeking $300 million in federal support for nonprofit mortgage counseling groups which he said were “the best defense against the coming storm of foreclosures throughout the country.”

Private economists warned the worst slump in housing in 16 years and the turbulence in financial markets from a resulting serious credit squeeze could push the economy into a recession as more borrowers fall into default, dumping even more homes onto an already glutted market.

“You have a lethal combination of higher mortgage payments, lower house prices, a weaker job market and more cautious lenders,” said Mark Zandi, chief economist at Moody’s Economy.com. “That is a very noxious mix and it is the reason for this surge in foreclosures.”

Zandi put the possibility of a recession at 40 percent, almost four times the possibility he had estimated in July, before the current credit crisis hit.

He said defaults will not peak until next year, reflecting a wave of introductory mortgages that are just now resetting from low “teaser” rates. Those resets can in many cases mean an extra $250 to $300 in higher monthly payments on the typical $1,200 monthly mortgage.
The MBA survey found that the delinquency rate, which tracks the number of people who are behind in their payments but have not yet entered the foreclosure process, was also up sharply during the spring. It rose to 5.12 percent of all loans, the highest level in five years and up from 4.84 percent in the first quarter.

The delinquency rate for subprime loans increased more sharply to 14.82 percent — up from 13.77 percent — in the first quarter. That marked the second-highest subprime delinquency rate on record after a 14.96 percent rate in the spring of 2002.

The delinquency rate for prime loans, offered to borrowers with good credit histories, also increased, but by a much smaller amount. It rose to 2.73 percent, up 2.58 percent in the first quarter.

Doug Duncan, the MBA’s chief economist, said the worsening performance was the result of two major factors — heavy job losses in the Midwest states of Ohio, Michigan and Indiana, a region hard hit by heavy losses in the auto industry and other manufacturing industries, and the collapse of previously booming housing markets in California, Florida, Nevada and Arizona.

“The percent of mortgages in Ohio that are 90 days or more past due or in foreclosure is still more than twice the national average and 1 percent of all the mortgages in Michigan had foreclosure actions started on them during the last quarter,” Duncan said.

He said there were also significant problems in the neighboring states of Indiana, Illinois, Kentucky, Tennessee and Pennsylvania.

Analysts said the problems in the formerly red-hot housing markets of California, Florida, Nevada and Arizona reflected, in part, speculators walking away from mortgages they can no longer afford. They had jumped into the market during the boom, hoping to take advantage of rapidly rising prices by quickly reselling.

But now with the inventory of unsold homes at record levels, many speculators are defaulting on their mortgages. Those defaults are dumping more homes on an already glutted market.

“With so much supply out there to compete against, borrowers who can’t pay their mortgages are behind the eight-ball,” said Mike Larson, a real estate analyst at Weiss Research. “They can’t sell to get out from under their obligations. As a result, more end up tumbling into foreclosure.”

During the five-year housing boom, which ended last year, prices in the hottest areas surged as investors bid up the price of homes hoping to quickly resell them for a profit. Now with home sales falling, the inventory of unsold homes rising and prices stagnant, some speculators are choosing to default on their mortgages.

Democrats on Wednesday blamed predatory lending practices for a large part of the current problems and said they planned to introduce bills aimed at halting such practices as aggressive marketing of subprime loans to unqualified borrowers.

Federal and state banking regulators issued guidance this week encouraging lending institutions to work with borrowers to restructure loans at more favorable terms rather than foreclosing on the existing mortgages.

Thursday, September 06, 2007

Kamloops Real Estate Is Still Thriving

Kamloops Real Estate is still thriving. Today Snap Up Real Estate listed a home in Westsyde for $375,000. This is nearly double what the owner paid for the home 4 years ago. The 2 bedroom townhouse is located in the West Pines Villas on The Dunes golf course. This is a premier adult living community, and the price reflects the prestige. One unit in the complex is currently listed at half a million dollars. The Dunes is also going to be the site for new lots recently opened up along the edge of the course on Harrington Road. Ground breaking has begun on basements for three new homes already.

Tuesday, September 04, 2007

Real Estate Is Now One Of The Perks Available To New Staff At The University Of Calgary

Real Estate is now one of the perks available to new staff at the University of Calgary. With the real estate market in Calgary being so volatile instructors are looking for that little extra perk. Canada.com reports that up to $100,000 is being offered to lure new staff. Full Article.

Mortgage perks lure professors to U of C
Interest-free loans help attract faculty

Deborah Tetley
Calgary Herald

University of Calgary recruiters are offering up to $100,000 in housing perks to new faculty faced with the challenge of buying a home in the city's hot real estate market.

Offers of interest-free loans and principle forgiveness on mortgages to new faculty are giving the university an edge in a highly competitive environment to recruit and retain staff, U of C administrators say.

"When candidates are making a comparison between us and another university, we want to make sure we don't lose them to the housing issue," said Alan Harrison, provost and academic vice-president at the university.

Since the plan's development over the past few months, about seven new professors and instructors have taken the university up on the offer -- on that is modelled after similar strategies at the universities of Toronto and British Columbia. The idea is also being considered at other Alberta post-secondary schools.

Harrison said although candidates are generally looking for "the complete employment package," final decisions often come down to real estate.

"People worry about two things," he said. "Market prices as high as they are and volatility.

"We can't do much about volatility, but we can ease the burden and show (candidates) that we understand the quantum difference between housing markets." Late last month the Canadian Real Estate Association forecast record levels of MLS sales across the country this year with Alberta to lead all provinces in the rate of average price growth.

Although aspects of a similar, smaller housing assistance program have been used by U of C in the past, deans now have discretionary spending power -- and larger budgets -- to lure new staff.

Given the university's goal of hiring 500 new faculty by 2010, many recruiters are capitalizing on the program's success.

In the faculty of science, for instance, at least four recent recruits have accepted interest-free loans to buy homes in Calgary.

Dean Sandy Murphree expects several more candidates will be given similar incentives during the next hiring spree, as the budget allows him to make offers to roughly 15 candidates.

"We want to attract the highest quality people and we can not afford to have an issue like personal finances be part of the problem," Murphree said.

Finances were an issue for new recruit Melissa Giovanni, who graduated in June from University of California, Los Angeles with a PhD.

Giovanni, 27, was recruited by the university in October to teach in the geology department.

She was compelled to accept the university's offer for several reasons, including the "competitive" salary and the housing perks.

"I had just got out of grad school," said Giovanni, who started at U of C Aug. 1. "I had no savings and student loans staring me in the face. Without this loan there was no way I would have been able to afford a down payment on a house at this time in my life." Although renting was an option, Giovanni said the prospect of owning a home sealed the deal.

"This will be a huge factor in my happiness for accepting the job at U of C," she said. Officials said the program is still in the "pilot" stage, and will likely be revised as issues crop up.

For now, individual faculties will absorb the loan charges and the university will provide the principle through its bank.

Principle forgiveness will likely be used as a retention strategy, Harrison said. The total benefit package (principle forgiveness and loans) can not exceed $100,000 per faculty recruit.

Anne Stalker, president of the university's faculty association, said the program has not only succeeded in recruitment, but in making salary offers more fair across departments.

Tuesday, August 28, 2007

Vancouver Real Estate Prices Are Among The Highest In The World According To Financial News Magazine Forbes

Real Estate prices in Vancouver are among the highest in the world according to Financial News Magazine Forbes. In a complicated way of measuring how overpriced real estate is Forbes has concluded that Vancouver is in the top 10 most overpriced real estate.

Vancouver among overpriced-land leaders
Forbes' formula deals us in for dubious honour

Ashley Ford
The Province

We all know Vancouver real estate is in nosebleed territory -- but globally overpriced?

According to a somewhat complex formula arrived at by Forbes magazine, Vancouver allegedly has the sixth most overpriced real-estate market in the world.

Monaco, the Mediterranean haunt of the rich and plastically-improved, tops the list of the globe's most overpriced real estate followed by Rome.

The rankings were compiled by calculating an effective annualized rate of return on a property based on annual cash flows derived from renting and adjusted for capital gains tax, transaction fees, operating costs and maintenance, appreciation and inflation.

"We then flipped the return rate to resemble the more familiar price-to-earnings measure," says the Forbes report.

That left the champion Monaco with a P/E ratio of 74.07.

The next nine are Rome (50.51), Paris (37.45), Madrid (30.30), Los Angeles (26.88), Vancouver (26.81), Vienna (25.77), Auckland (25.64), Zurich (25.19) and Oslo (23.45).

The study looked at 50 financial capitals in every continent, except Antarctica, of course. For the most part this meant one city from each country but for countries like India, China, the U.S., Australia, Canada and Switzerland where there were multiple, distinct financial centres, several cities were measured.

If you are thoroughly lost by now, Forbes offers a somewhat simpler way of absorbing their numbers.

"Think about each market like you would a stock: The higher the price-to-earnings figure, the more you have to pay to get one dollar of return," it says.

The valuations were based on data from GlobalPropertyGuide.com, an international real-estate research firm. For each market, it assumed no debt financing, a constant cost of capital, a 10-year hold of the property and a non-primary residence.

Tuesday, August 14, 2007

Commercial Real Estate Is Set For A Nose Dive If The Markets In The US Continue On The Current Negative Trend

Commercial real estate is set for a nose dive if the markets in the US continue on the current negative trend. Analysts report that rising borrowing costs may make some commercial real estate ventures unappealing, and the owners will start to sell. Full Article from the Financial Post.

Teetering towers
Commercial Real Estate industry braces for a fall in prices

Garry Marr
Financial Post
Saturday, August 11, 2007

Falling real-estate prices? It sounds like a contradiction in terms. But rest assured, it can happen and many in the sector are bracing for a declining commercial real estate market -- something that hasn't happened in the past seven years.

"I promise you [prices] can go both ways. I've seen enough of that in my career," said veteran real-estate analyst Frank Mayer, who retired this year after 35 years in the sector. "Just think of 1989 through 1994."

The latest statistics from real-estate firm CB Richard Ellis Ltd. show that for the first time this century capitalization rates are actually inching up in some markets, albeit slowly. Cap rates, as they are known in the industry, are the real estate sectors' method of pricing property.

The cap rate is determined by taking a building's positive cash flow and dividing by the value of the asset. A building with $100,000 in positive cash flow that's valued at $1-million would have a 10% cap rate. Much like the yield on a bond, rising cap rates are indicative of falling prices.

The concern in the real-estate community is that rising borrowing costs are going to make it harder for companies to make profitable leveraged real-estate purchases. As borrowing costs go up, cap rates will have to rise too in order for transactions to make financial sense.

"There's a raging debate in the real estate community," says Mr. Mayer, about whether higher borrowing costs will ultimately impact real-estate prices. The thinking among some commentators is there is some institutional and pension-fund money, immune to debt concerns, waiting to buy real estate. That demand would mean prices won't budge.

Cap rates are already at an all-time low in most markets in the country. The starkest example is probably Vancouver's apartment market where investors are willing to accept a 3.5% return on a high-rise unit. If that sounds low, consider the Bank of Canada's 10-year bond -- a risk-free instrument in terms of potential default --generates about a 4.5% return.

The Vancouver apartment building pays one percentage point less than the Government of Canada debt and presumably carries a little more risk than the bond. But investors in Vancouver and other hot markets such as Calgary and Edmonton are paying a premium for potential growth in income and capital.

"If you are [investing in] Alberta where rents are up 40% from a year ago and are going up sharply again, a 5% cap rate really isn't a 5% cap rate. You know the returns are going to be higher in future," said Mr. Mayer.

Michael Cooper, chief executive of Dundee REIT, which last month pulled off a $2.4-billion real-estate sale that many say will be the last of its kind in this cycle, says pricing real estate can be tricky these days.

Dundee sold most of its assets in Ontario, Quebec and Newfoundland to GE Real Estate. Dundee held onto to $1.5-billion of assets in western Canada and GE Real Estate agreed to buy $165-million of outstanding units in the REIT, about 18% of Dundee, at $47.50 a unit.

"He got that deal done right under the wire. No way it would get done today at that price," said one analyst.

But Mr. Cooper says there is a new reality in the marketplace that is impacting pricing. "From 1995 to 2005 it was all about current income, but now we have growth in rental rates in almost every market in the country. More of the value is coming from [anticipated] growth," he says. "Today, sure you pay more interest and cap rates are lower but that's just Day 1. We all anticipate that income will grow."

He says publicly traded REITs are recording huge jumps in income because rental rates just keep rising on their existing portfolios. In fact, says Mr. Cooper, buildings with long-term leases and low rental rates are going to drop in value.

"Five years ago if you had a locked-in lease people said 'this is fabulous.' Today people say 'you've given up so much on the asset'," he says.

CB Richard Ellis actually thinks there could be some downward movement in cap rates, but, for the most part, thinks prices have stalled. "We are seeing a trend where rates have flattened compared to where we were three or four years ago," said Ray Wong, national research director of CB Richard Ellis. "Some investors are starting to question the pricing of assets."

Ross Moore, the research director of Boston-based Colliers International, is more pessimistic. "I can't go to a meeting or get on a conference call these days without somebody talking about a deal that is falling apart," he says. It's all about the rising cost of debt and Mr. Moore says it's leading to a lot of renegotiating.

"There is a general tone in the marketplace of caution," said Mr. Moore, who doesn't believe improving fundamentals and rental rates will carry the day in the market. "I learned a long time ago fundamentals do not drive real-estate values; liquidity and access to capital drive values. Period. That may sound cynical but that's what I believe. Capital markets are global. This isn't just a U.S. problem," said Mr. Moore, about some of the deals now falling apart. "This will happen in Canada."

Wednesday, August 08, 2007

Edmonton Real Estate Has Begun To Cool After Huge Surges In Prices And Sales In The Last Year

Edmonton real estate has begun to cool after huge surges in prices an sales in the last year. Last month the price of a home in Edmonton fell for the first time in many months, triggering concern that the housing market is cooling in the city. The Edmonton Journal Reports.

Real Estate in Calgary is still flying high, too high for most. The average home price is now $500,000 in cow town. This is way out of reach for most working people in the city. The rising oil prices will only further fuel high home prices. On the positive side MLS reports a very high inventory in Calgary, relatively speaking. Alberta Index reports.

Friday, August 03, 2007

Calgary Real Estate Is Poised To Level Off

There are now more homes on the market in Calgary than at any other time this year. The Calgary Real Estate Board says as of the end of July there were almost 9,000 homes up for sale.The average price of a single family home in Calgary last month was almost $510,000.The average condo price was just over $318,000.The real estate board says with all this inventory, prices can be expected to level off.

BC's Biggest Deal
British Columbia real estate has reach new highs. The largest deal in BC history has seen $246 million change hands for a 25 story high rise. Full Story.

Central City Tower has been sold in what is described as the largest real estate deal in B.C. history.

The Insurance Corporation of British Columbia (ICBC) announced Wednesday it sold the 25-storey tower to Blackwood Partners Inc. for about $246 million. Blackwood is a real estate transaction group, which bought the property on behalf of a consortium of Canadian pension funds.

ICBC has had the property listed for a few years, describing it as “not appropriate for the company’s investment portfolio.”

The components of the Central City project that have been sold include 570,000 square feet of office tower and podium space, and 490,000 square feet of retail mall space. Simon Fraser University continues to own 305,000 square feet in the tower and podium.

It’s also believed the company is preparing to make an offer on the Zellers store.

All tenants of the building are expected to remain.

Central City has a long and colourful history.

The Leader first reported in 1999 that ICBC had purchased the Surrey Place Mall property in North Surrey for $40 million. The purpose of that acquisition was to construct the current tower and provide a home for the now defunct TechBC, a technical university created by the former NDP government.

In 2001, the newly elected Liberals folded TechBC in favour of SFU, and the government set about off-loading the tower property.

At the time, a number of Liberals blamed the NDP for the acquisition. Former finance minister Gary Collins said it was a scandal equivalent to the fast ferries fiasco.

“The only difference between this and the fast ferries is that this one doesn’t move,” Collins said in 2002.

Two years later, the Liberals announced they were spending $70 million to acquire 305,000 square feet of the building for the Surrey SFU Campus.

Earlier that year, Central City won the prestigious International Property Market’s Special Jury Award as the world’s best overall new development.

ICBC has said the proceeds from the sale will be reinvested to help keep auto insurance rates down and stable.

Monday, July 30, 2007

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Thursday, July 19, 2007

Ottawa's Real Estate Deal Is Bad For Taxpayers

Stupid Canadians

The Canadian Federal Government has almost completed their harebrained scheme of selling of hundreds of millions in real estate, so they can lease it back from the new owners. This sounds like a hell of a plan doesn't it. On top of selling, then leasing back, the government is going to pay for any maintenance that is required is the dilapidated building. I need to own one of these buildings. Free money from the government, 25 year lease, better than the lottery. Full article below from the Globe and Mail.

Ottawa's real-estate deal is bad for taxpayers

Globe and Mail Update
July 17, 2007 at 11:12 PM EDT

Most homeowners would consider it absurd to sell their property and rent it back in order to pay for a new roof or other maintenance. Moving from ownership to being a tenant just doesn't make sense.

Yet that's what the federal government is planning for a handful of prime real-estate assets owned by Canadians.

By the end of the summer, the federal government will pick a new owner or owners for nine of the best federal office buildings located in major cities across the country.

The plan is to sell these buildings and the land on which they are located, which taxpayers currently own outright, then guarantee the new owners that the federal government will lease back 100 per cent of the space for 25 years.

In addition, the government promises the new owners that taxpayers will foot the bill for all maintenance and upgrades to the buildings' interiors. Tax dollars will ensure that heating systems, windows, elevators, plumbing and electrical systems in these soon-to-be-private buildings are kept in top shape.

Sounds like a sweet deal for the new owners, but is this a good deal for taxpayers? On the surface, the answer would seem to be no. And a more detailed examination of the transaction isn't possible because most every important detail is secret.

All documents, studies, valuations, and advice about the sale and leaseback are being withheld from the public. The federal government has established a cloak of secrecy so dense that even members of Parliament are being kept in the dark. In fact, a parliamentary committee recently called for the sale to be put on ice until these details are made available to the public.

The public is not allowed to see the study conducted by the real-estate wings of two banks (Bank of Montreal and Royal Bank of Canada) that recommended the sale and leaseback plan for these nine buildings. These same two banks are now acting as real-estate agents in the sale of the buildings — for a commission fee — creating the strong appearance of a conflict of interest.

The identities of the bidders are secret, as are the details of their bids. And taxpayers will pay Deutsche Bank almost $2-million to review the transaction before it's final. This, too, will be kept secret.

With so much information being withheld, it's reasonable to ask: What is the government trying to hide? And can taxpayers expect to be treated in this manner by the new owners?

Some details have leaked out. The Globe reported last month that taxpayers could lose up to $600-million if the deal goes wrong and there are irregularities in the valuation of the properties, including one building that was valued at $120-million in excess of the market price.

According to the man in charge of the sale, Public Works Minister Michael Fortier, successive governments have failed over the years to properly maintain the buildings.

Taxpayers, who ultimately own these assets, are faced with a multibillion-dollar maintenance bill to bring the federal real-estate portfolio up to scratch.

This is a reasonable assessment of the situation. But offering the buildings at fire-sale conditions is penny wise and pound foolish in the long run. According to James McKellar of the Schulich School of Business at York University: "it looks like the government's doing the right thing today, but it is really short-term gain for long-term pain."

It's also important to note that Mr. Fortier has been silent when it comes to making a commitment that money from the sale will be used to fix up the buildings in need of repairs.

This is a bad idea for taxpayers. According to our calculations, Canadians could pay as much as $2 in rent for every $1 received in proceeds from the sale.

Locking taxpayers into 25-year leases removes the flexibility the government requires to manage its real property needs, which go up and down according to the number of public service workers it employs, as well as other factors.

If the government gets out of real estate today, what happens 25 years down the road when it may wish to resume ownership? After 25 years, its expertise in building-asset management will be long gone.

Ottawa should scrap this sale and leaseback plan and come back with an alternative that makes economic sense for taxpayers and can be proudly shared in all its detail.

Friday, July 13, 2007

Real Estate Prices In Canada Are Up, Again

Home prices in Canada are up, again. Huge price jumps occurred in Alberta and Saskatchewan, near 30 percent in both cases. Ontario and Quebec took a bit of a hit on the housing front due to the rising Canadian dollar. All in all Canadian real estate is healthy and growing. Full Yahoo! News article.

Tuesday, July 10, 2007

Real Estate Lawyers Go Paperless

Lawyers are usually a bunch that enjoy tradition and are somewhat resistant to change. This is not the case with real estate lawyers. The Canadian Bar Association has entered into an agreement to have a paperless transaction for mortgages. Read the article below.

Real estate lawyers going paperless
By: Vawn HimmelsbachIT World Canada (09 Jul 2007)
The Canadian Bar Association has entered into a preferred supplier agreement with Emergis to make the mortgage application process a lot less painstaking.

The service, called Assyst Real Estate, electronically links lenders and lawyers. Once the lender approves a mortgage loan, instructions are sent to the lawyer or notary (depending on the province) on what must be done to close the mortgage. This is a fairly long process involving multiple forms to be signed by the client, which are typically sent back and forth several times.

Using the electronic service, the lender sends a file to Emergis as soon as the mortgage is approved, and that information is sent through Emergis to the lawyer.

“We present a summary of the mortgage instructions that contains all the financial data,” said Pierre Bisson, vice-president of Assyst Real Estate with Emergis Inc. The lawyer receives the information on the Web through a secure portal, and whenever a status or an event is confirmed, the lender is informed electronically.

“We eliminate the paper between the lawyer and the lender, so when the lawyer receives the information electronically, he can start working on the file,” said Bisson.

The banks want a seamless way of providing instructions and receiving reports when they’re advancing mortgage money to clients, said John Hoyles, CEO of the Canadian Bar Association.
“The difficulty for them is that there are many different report styles,” he said. “With this kind of program, it will all be the same, [and] it can all be done online.”

After selecting Emergis in an RFP process, the CBA negotiated an arrangement to provide this service to its members at a reduced cost. However, this does not mean every lawyer that practices real estate law is required to use the service – it’s up to them.

Lawyers tend to be quite conservative, said Hoyles, and some people embrace new approaches more than others. “But the reality is, if you’ve got a high-volume real estate practice it would be helpful,” he said.

The manual method involves going to the bank with a requisition letter for the funds. “If you look at the real estate fees charged by lawyers, they’ve virtually been unchanged for 20 years,” he said.

“If you can lessen the steps in the process and your cost to do the transaction, then it makes business sense to have something that’s as simple as possible.”

The CBA provides a link on its Web site to Emergis, and will be working with the vendor to provide seminars for members as it rolls out the service in each province.

While the process is paperless between the lawyer and the lender, the purchaser still needs to sign the documents. Lawyers, however, use a digital signature through the use of a certification authority.
Emergis has operated in Quebec for the past five years and some 80 per cent of notaries in the province use the service, according to Emergis.

The vendor has an agreement in place with the Royal Bank of Canada and Desjardins Bank in Quebec. It recently signed an agreement with Laurentian Bank, and the service should be operational this fall in Quebec.

“The agreement that we have with the Canadian Bar Association enables us to have better coverage with the lawyers because the CBA represents all the lawyers across Canada,” said Bisson.

Emergis is currently rolling out the service in B.C. and Ontario, while the Western provinces are expected to be onboard by the end of this year and the Maritimes in 2008.

In some cases the mortgage process involves 16 to 20 different forms, and those forms can be quite different from one province to another, so Emergis is integrating the service with the provinces while providing a common interface for lawyers and lenders.

It’s also in discussions with other financial institutions to expand the service.

Tuesday, July 03, 2007

Real Estate Can Be A Blood Thirsty Business

Famed castle to Dracula, Bran Castle, is now up for sale in Romania. The castle along with the surrounding fields, perhaps up to 40+ acres, is expected to sell in the nine figure euro range. Dracula must be turning in his coffin. Read the full article below.

Dracula's castle at stake in real estate deal

Friday, June 29, 2007
NEW YORK (Reuters) -- In the cutthroat business of real estate, U.S.-based firm Baytree Capital Associates has been chosen to market Dracula's Castle.

Archduke Dominic Habsburg, who lives in New York State, and his family retained the private investment firm to market Bran Castle and the surrounding property in the Transylvanian region of Romania.

"They're looking to flat out sell the entire project, but they are particular about who they sell it to," said Michael Gardner, Baytree chair.

"While they are amenable to someone building a resort that continues the castle and such, they're not amenable to blood dripping on swords. This is not going to be Vampire Land."

While he would not say how much the property would go for, he suspects it would be in the nine-figure euro range. He expects to start marketing the property in about 60 days.

The castle and ancillary buildings are located on 22 acres and additional acres also may be attached to the sale. The property is about 20 minutes away from an international airport that is under construction and near the Brasov ski area.

The association of Bran Castle as Dracula's Castle can be traced back to Irish author Bram Stoker, who used the castle as his inspiration for the settings of his 1897 novel, Dracula. The Romanian government has about two years left to operate the castle as a museum, which plays host to about 450,000 visitors a year, Gardner said.

The castle originally was built as a fortress in 1377 and was given to the Romanian royal family in 1920. The castle became a possession of the state in 1947 and was transformed into a museum in 1957. The Romanian government returned the property to the Habsburg faimly in 2006.

Gardner said the property will probably be marketed to private equity firms and hotel real estate investment trusts, but the buyer will probably be European.

© The StarPhoenix (Saskatoon) 2007

Northwest Territories Real Estate News

Real Estate in Canada's north is experiencing a bit of a crunch do to the energy boom. Some prime housing is sitting empty in Yellowknife, and local officials feel the government owned property could be put to better use. Northwest Territories Real Estate has been on the rise for the last three or four years do to an expanding resource sector.

As a housing crunch escalates in Yellowknife, questions are being raised about some government-owned houses that are sitting empty on prime real estate.

The five houses on 55th Street, which were used as federal government housing, are located close to schools and the downtown.

"You'd probably put it on the market, and probably that day or that evening … you'd probably have six, seven people putting in offers," real estate agent James Clarke told CBC News.

But the federal government has no plans to put them on the market any time soon, even though they've been sitting empty for years.

The houses are part of a large inventory of federal government housing that dates back to the 1960s and was used for RCMP officers and other employees.

In 2003, when they were declared surplus by the federal Public Works Department, Indian and Northern Affairs Canada (INAC) purchased them as potential offerings in future aboriginal land claims negotiations.
From CBC.ca
Full Article

Thursday, June 28, 2007

Snap Up Real Estate Sold A Home In Just 2 Days

A customer of Snap Up Real Estate posted their home on the site and two days later it was sold. He did not advertise on any other websites or in any classifieds. This is the power of the Snap Up Real Estate marketing system.

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All extended listings are currently getting a bonus of placement in the featured properties section. Featured properties are displayed on the home page and most secondary pages, giving your property extra exposure.

If you need help selling your home give us a call 250-434-4372 and ask for Bart.

Thursday, June 21, 2007

Kamloops Real Estate Agent Receives Sentence

A realtor who bilked fellow agents out of hard earned money has been sentence to a conditional sentence, to be served in the US.

Realtor to serve sentence in U.S.
by Robert Koopmans of the Kamloops Daily News

A former city Realtor who took $76,000 from her firm’s trust account will be allowed to serve her conditional sentence in the U.S., a judge ruled Tuesday.

Cheryl Moseley, known better to Kamloops as Cheryl King, pleaded guilty Tuesday to one charge of illegally accessing trust funds.

The Crown told the judge the 62-year-old woman took the money from her real estate firm’s trust account as financial affairs collapsed around her in late 2001.

The money she took before she fled Kamloops was partially used to repay a loan from her mother, B.C. Supreme Court Justice Richard Blair heard.

Blair went along with a joint submission for sentence proposed by the Crown and defence lawyers and imposed a two-year less a day conditional sentence, even though the woman now lives in Iowa.

Crown counsel Lorne Fisher said this type of case does not usually see the imposition of conditional sentences. Typically, people who violate the trust of employers or clients in such fashion face jail.

In this case, however, Moseley’s circumstances make a conditional sentence the best option, he told the judge.

Moseley suffers several serious health conditions, including heart disease serious enough that she is expected to soon need arterial bypass surgery.

Fisher said the woman is covered by health insurance in the U.S., but her coverage would be terminated if she leaves Canada for more than 60 days.

Jailing Moseley would see her health-care costs transferred to the Canadian penal system, Fisher said, adding she would be “one expensive prisoner.”

Justice Blair said he could not ignore such an obvious issue, noting the courts must consider all aspects of the public interest in deciding sentences.

“To imprison (her) in Canada would . . . leave the cost of her medical costs with the Canadian taxpayer,” said Blair.

Regardless, Blair had concerns about the idea of imposing a conditional sentence to be served in the U.S., especially with regard to the issue of monitoring.

In Canada, a person who violates terms of a conditional sentence can be brought back to court and made to serve all or some of the sentence in jail.

How could that work if an offender lives in the U.S., asked Blair?

The prosecutor said the Crown will ask American authorities to oversee Moseley’s sentence and report back to Canadian officials. If Moseley fails to abide by her terms, she can be brought back to Canada.

“We do have extradition treaties with the United States,” he said. “Has it been done before? I can’t tell you that it has, no.”

In the end, Justice Blair said while offences involving breach of trust typically demand jail, this case is different, he said.

“I recognize the problem is unique and requires flexibility,” said the judge.

Terms of the conditional sentence will require Moseley to live in Charles City, Iowa, and not change her address without permission. She was prohibited from consuming alcohol for 12 months, and ordered to perform 120 hours of community service work.

However, Justice Blair did not impose a period of house arrest or a curfew, terms often considered usual in conditional sentences. The judge gave no reason for the lack of such restrictions.

Lastly, Moseley was ordered to repay the $76,000 she took from her former firm’s trust account. The money is owed to Re/Max Canada, which covered the losses when they were discovered in 2001.

Before sentence was imposed, the court was told Moseley’s criminal behaviour was an act of desperation as her business and personal life fell apart.

Moseley came to Canada in 1993, after she married Kamloops rancher Bob King on a Cattle Drive.

Her marriage collapsed, however, and by 2001, Moseley was trying to keep afloat both her ranch and her real estate business.

An attempt to secure bank financing failed and shortly after, Moseley raided the trust account. She fled Kamloops and has lived in the U.S. since.

After her disappearance, it was suggested Moseley’s debts tallied in the hundreds of thousands of dollars.

Kamloops Realtor Mike Applegath was one of those burned the most by Moseley, the court was told. She fled owing him more than $56,000, as well as the messy aftermath of the failed realty firm.

“The whole situation with regard to Kamloops Re/Max Realty Assist . . . was a financial nightmare,” the prosecutor told the court. “Her conduct caused a great deal of consternation for many people who trusted her.”

Fisher said later the Crown could not consider a jail term of less than 60 days in jail for such a serious offence, for fear it would set a precedent in similar cases. A conditional sentence is considered by the Canadian justice system to be the same as jail.

Tuesday, June 19, 2007

For Sale By Owner - Real Estate

A new study from the US shows that using a real estate agent to sell your home does not mean that it will sell for more money. The study, done at Northwestern University, studied the real estate market of Maddison Wisconsin. The study showed that those who did not use a real estate agent to sell their home came out with more money after the transaction than did those who used a real estate agent. Read the Full Article.

From TheChronicleHerald of Halifax, Nova Scotia.

You may need a real estate agent, but maybe not

By JEFF BAILEY The New York Times
It sounds like the setup for a dull economist’s joke. Who gets the better deal: the cautious economist who sells his house through a real estate agent, or his risk-taking colleague who finds a buyer on his own?

But the question — debated by two Northwestern University economists who chose different methods to sell their homes — and the research it helped prompt are serious. And the answer will be of interest to anyone who has paused to consider whether paying a real estate agent’s commission, typically five per cent to six per cent of the sale price, is worth it.

The conclusion, in a study based on home-sales data from 1998 to 2004 in Madison, Wis., is that people in that city who sold their homes through real estate agents typically did not get a higher sale price than people who sold their homes themselves. When the agent’s commission is factored in, the for-sale-by-owner people came out ahead financially.

Madison is home to one of the biggest for-sale-by-owner websites in the country. The economists pitted that site against the local multiple listing service operated by real estate agents.

There are asterisks. The authors cautioned that they did not know whether the results from Madison applied to the country as a whole; certainly, selling a house without a real estate agent would be harder in a city without a heavily trafficked for-sale-by-owner website. The authors are also analyzing Madison data from 2005 and 2006, when the housing market cooled after a long run-up, to see how their findings might have changed.

Some aspects tilted in agents’ favour. The researchers found that homes on the multiple listing service sold somewhat faster than houses on the for-sale-by-owner site. The study also did not place a value on other services provided by agents in selling a home.

The authors have presented their paper at forums at many leading universities, but it has not yet been submitted to a journal for peer review.

Friday, June 15, 2007

Canadian Real Estate Is Still Rising

Real Estate in Canada is still rising, along with the interest rates on mortgages. One would think that with a rising interest rate that new and resale home sales would drop off. This is not the case in Canada where real estate continues to surprise industry insiders with double digit percentage gains. The following article presents the case across Canada. Full Article.

Red-hot real-estate market breaks records in May

Eric Beauchesne
CanWest News Service
Friday, June 15, 2007

OTTAWA - Home sales and prices hit all-time highs last month, flying in the face of repeated predictions of a cooling of Canada's housing boom.

The numbers also add to expectations of stronger overall economic growth and rising interest rates.

The record-shattering surge in activity was not limited to Western Canada: growth was also reported in Ontario, Quebec and Manitoba.

The Canadian Real Estate Association (CREA)released its report as mortgage rates were climbing to their highest level in five years - and as the Bank of Canada was considering raising other borrowing costs to cool what it calls an economy that's operating beyond its non-inflationary capacity.

"Residential sales activity, new listings, average prices and dollar volume in Canada's major markets broke all previous monthly records in May," the industry association said.

Sales reached 42,039, 11.6 per cent higher than a year earlier, and the first time in history they have surpassed the 40,000 mark in a single month, it said.

The increase was led by gains in Montreal and Toronto.

Seasonally adjusted sales were also up 1.3 per cent from April, led by one-month gains in Vancouver, Winnipeg, Ottawa, Montreal, and London and St. Thomas, Ont.

"In a nutshell, the housing market just keeps powering ahead," said BMO Capital Markets economist Douglas Porter.

Only a day earlier, Porter noted, Bank of Canada Governor David Dodge had admitted home prices had stayed stronger for longer than it expected, keeping the open flame on inflation pressures, especially in Western Canada.

Last month's results will not ease the central bank's concerns, he added.

The average selling price of a home was up 10.2 per cent from a year earlier to a new monthly record of $333,524, which was also a marginal acceleration from the 10-per-cent average of the first five months of the year.

"And it is far from just a Prairie brush fire any longer, as fully 11 of the 24 reporting cities posted double-digit increases," Porter said.

Prices hit all-time highs in many of the cities, led by $591,722 in Vancouver, and including Calgary, Edmonton, Regina, Saskatoon, Toronto, Montreal, Quebec City and Halifax.

The steepest price increase was in Edmonton, up 47.3 per cent, followed by Saskatoon, up 44.1 per cent, but with double-digit gains in a string of other cities in Quebec, Ontario, and Manitoba.

The only cities to see prices drop were auto-dependent areas of Windsor and St. Catharines, Ont.

"While the big cities in Central Canada are not piping hot, each of Toronto, Montreal and Ottawa saw hefty gains in sales in the month and are still posting moderate price increases," noted Porter. "That's a lot more than you can say about the vast majority of U.S. cities."

"The pressing issue is whether this long-lasting run of strength can continue, particularly with five-year mortgage rates climbing to their highest level since 2002 in recent days," he said.

"We suspect that, finally, the housing market will begin to lose a touch of steam nationally in the months ahead amid the steady erosion in affordability," he said. "However, with consumer confidence still very strong and income growth solid, we doubt that a major correction lies ahead."

CREA chief economist Gregory Klump agreed, saying it's expected that price increases will slip below 10 per cent this year to an average of 9.7 per cent, and then ease further to 5.5 per cent in 2008.

In the meantime, National Bank of Canada economists said the red-hot home resale market will also bolster the overall economy.

"Strong resale activity is also providing a significant wealth effect to consumers and supports spending," they noted.

The report comes only a day after the industry published a study saying that each home sale boosts consumer spending on average by $32,000, on moving costs, legal fees, commissions, renovations and so on.

Friday, June 01, 2007

What You Need To Know About The 2010 Vancouver Olympics

Real estate developers are cashing in the the games. When Vancouver was announced as the location for the 2010 Games real estate prices went through the roof. On top of that a new road, or rail line, was needed from Vancouver to Whistler. All the land along the road would be worth mega bucks. The Olympic bid set in motion the wheels of business and politics, which are linked and the head in British Columbia. British Columiba real estate prices are now the highest in Canada, thanks 2010 Games. Read on Below.

Full Article

Developers are the Games’ real winners

A former developer himself, Premier Gordon Campbell holds the purse strings to an Olympic-size sweepstakes payout.

The 2010 Olympics were still a gleam in Jack Poole's eye when he addressed a roomful of real-estate developers in the spring of 2002. Vancouver had been shortlisted for the Games, but it would be more than a year until the winning city was chosen.

The outcome of the race to win the Games didn't seem to matter to Poole, who headed the 2010 Vancouver Bid Corporation. Western Investor editor Frank O'Brien sat in on the talk and later editorialized that, according to Poole, "the real purpose of the 2010 Olympic bid is to seduce the provincial and federal governments and long-suffering taxpayers into footing a billion-dollar bill to pave the path for future real estate sales."

Indeed this was Poole's opinion. "If the Olympic bid wasn't happening," he told the developers, "we would have to invent something." Long-time developer Poole had it right. The Olympics are about real estate.

To make his case, Poole could point to the 2002 Winter Olympics in Salt Lake City, Utah. A Sports Illustrated exposé of these Games described how a blizzard of federal money–$1.5 billion–enriched already wealthy developers and ski-resort owners.

B.C. premier Gordon Campbell knows well how taxpayers subsidize developers. As executive assistant to Vancouver mayor Art Phillips in the 1970s, he was involved in the lengthy negotiations between the city and real-estate giant Marathon Realty regarding the fate of the company's massive land holdings on the north side of False Creek.

The Phillips-led council rezoned the land from industrial to comprehensive development, boosting its value enormously.

Campbell left City Hall to become a development officer for Marathon Realty. Campbell and Marathon decided not to proceed with the development because the economy was tanking. The Bill Bennett government conveniently came forward with plans for a stadium. Campbell was all smiles when he announced that Marathon would be glad to sell the land to the province at a good price. It was still worth three times as much as its value before the city rezoning.

Campbell moved on once again. This time he started his own development company and bought several properties across the street from the stadium location. He boasted that he got the property at a rock-bottom price before others became aware of what the stadium would do to land values. He built a hotel that was completed at about the same time as the stadium.
Twenty years later, Campbell holds the Olympic purse strings, and as Poole pointed out, it's payday for developers.

Some developers benefited handsomely from taxpayer investment in the $2-billion Canada Line and the $800-million Vancouver Convention and Exhibition Centre expansion. But the main vehicle for creating developer wealth is the $2-billion (including future debt-servicing costs) investment for traffic improvements between Vancouver and Whistler. True, some of this money would be spent on the Sea-to-Sky Highway even if there were no Olympics. But this work was fast-tracked, meaning that projects in other B.C. regions were shelved.

In urban land economics, they say that the purpose of transportation is to connect land uses and make them more accessible and valuable. Think of the boom in real-estate values in Vancouver's Main-Cambie corridor after the taxpayer-financed Cambie Street Bridge went in.

During 2002, as Poole and the bid corporation prepared their final proposal, the provincial government was studying various options for improving the link between Vancouver and Squamish. As well as looking at major upgrades to the existing highway, the provincial Ministry of Transportation and Highways reviewed possible routes through the Capilano, Seymour, and Indian river valleys. These alternatives would cost more–from 50 percent to 100 percent more–but the result would be a safer, faster ride.

But these alternative routes went largely over Crown land. How could they help future real-estate sales?

The ministry evaluated all aspects of the routes. One factor leapt off the page: "developable land accessed". Upgrading 99 North was ranked five out of five for this factor, with five being the best, or the most. The other options received a score of one out of five.

One area with great "developable land" potential was Britannia Beach, but its ownership was in limbo. West Vancouver investors purchased the Britannia Mine site and 4,000 surrounding hectares in 1989. They struggled from one failed attempt to another to find a way to clean up the site and turn a profit.

Then along came the Olympics, and Britannia Beach's fortunes changed overnight. Vancouver developer Rob Macdonald came out the big winner. He's a strong Gordon Campbell supporter, having donated nearly $100,000 to the Liberals since they won the 2001 election. Macdonald purchased the offshore company that held a mortgage on the property and pushed for a speedy resolution of the ownership situation. A month after Vancouver was awarded the Games and the Campbell government chose the Sea-to-Sky Highway route, the B.C. Supreme Court turned the property over to Macdonald for an undisclosed amount.

If the Vancouver-Squamish connection had gone inland, Macdonald's newly acquired property would be worthless. Instead, the highway would go right by his front door.

Macdonald donated more than 90 percent of the land to the province. This was steep slopes that were useless for development and contained "some of the most contaminated land in North America", according to then–Sierra Legal Defence researcher Mitch Anderson.

Let the taxpayers assume responsibility for the cleanup. Macdonald also agreed to contribute a levy of $1.75 million toward remedial work.

Macdonald kept 202 hectares of high-value land for residential and commercial development. He would get further assistance from taxpayers in the form of $27 million for a plant to treat polluted water from the mine, another $99 million for the province to clean up contamination of the lands it got from Macdonald, and millions more from Natural Resources Canada for a visitor centre and mining museum, boosting the value of Macdonald's commercial property.

The Squamish First Nation was another big winner in the Jack Poole sweepstakes. In a complicated land swap in 2000, the First Nation ended up with an option to buy land from BC Rail at Porteau Cove in order to create a new reserve and build houses for band members. This had nothing to do with Olympics or highway improvements.

Porteau Cove is one of the very few developable sites between Vancouver and Squamish, a 500-hectare strip on the shores of Howe Sound running south from Porteau Cove Provincial Park to Deek's Creek.

Developers eyed this land for decades, but it was owned by BC Rail and not for sale. Then along came the Olympics with their highway upgrade, and the land skyrocketed in value. It was now too valuable for band housing. In 2004, the band exercised its option to purchase the land for a reported $12 million. It then signed a deal with Concord Pacific Developments to develop 1,400 homes. Interestingly, two former chairs of Concord Pacific were among the developers on the board of the 2010 bid corporation, along with Poole.

The lots are marketed as being just 25 minutes from downtown Vancouver via the new Sea-to-Sky Highway. If the venture earns just $50,000 for each lot, after putting in roads, sewers, water lines, and public amenities, that's still a profit of about $58 million to be split between the band and the developer. For its part, the band says it plans to invest the profits in housing and job creation for band members–elsewhere, of course. In Concord Pacific's case, some of the profits will likely flow back to its Hong Kong owners.

Meanwhile, up in Squamish, former UBC president David Strangway's dream for Canada's first privately owned secular university would likely still be languishing on the drawing board without the Olympics and the Sea-to-Sky Highway improvements.

When the decision to award the Games to Vancouver was announced, university project leader Peter Ufford said it "will help us in marketing the location of the university", adding that "it will help us with our real-estate sales." Because the university's business plan depends on selling 960 units of market housing, this was good news indeed. To some extent, Ufford could thank his own efforts. He was yet one more marketer on the board of the 2010 bid corporation. He was also a governor of the Canadian Olympic Committee.

In less than a year, Ufford sold the first 19-hectare parcel to a local developer to build and sell 200 housing units. With building lots listing for $290,000 and houses ranging in price from $430,000 to $1.2 million in the immediate vicinity, that's a big boost to the university's fortunes.

Strangway says the university is being built without public money. If he means no public money has been invested directly in the construction of the university, he's probably right. But, like that of Macdonald at Britannia Beach and the Squamish First Nation and Concord Pacific at Porteau Cove, his land would be worth a lot less without the support of B.C.'s long-suffering taxpayers.

Wednesday, May 30, 2007

Canadian Real Estate Is Still Flying High

Prices in Canadian Real Estate have continued to rise, even with the dismal market in the US. Home sales in Canada are fueled by booms in the Western Provinces, and of course commodity prices. Real Estate in Saskatchewan is the biggest winner in last months stats with a 24% increase in home price as well as the largest increase in volume sold. While real estate in Alberta continues to make huge gains, nearly 30% over the same time last year, British Columbia Real Estate also remains strong with the highest average price in Canada.
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On the lighter side of business and real estate a firm in Hawaii is selling real estate that does not yet exist. Land is being sold on a volcano that is likely to produce waterfront in 10,000 years. What!
Full Article

Thursday, May 24, 2007

Saskachewan Real Estate Has Begun To Heat Up

Small rural towns that are within commuting distance to Saskatoon, Regina, and Moose Jaw are experiencing a rise in real estate prices. The drain of population from Saskatchewan has begun to come back. Those who moved out of the province to find work are now returning to a better quality of life. The Leader-Post has the full details.

Real the Full Article or continue below.

Real estate boom hits rural Sask.

David Hutton
Saskatchewan News Network; CanWest News Service
Tuesday, May 22, 2007

SASKATOON -- Dale Arsenault moved back to Rosetown, his childhood home, from British Columbia two years ago to retire peacefully. The real estate agent's plan was to work shorter days and slow the pace down. His wife, Earla, opened a women's fitness centre on Main Street to keep them busy.

"I've been busier than ever," says Arsenault, 63, who opened his real estate office six weeks ago to capitalize on the town's growth. "I'm getting two or three walk-ins per day from Alberta and B.C."

Arsenault now works 14-hour days to keep up with the work, he says. Like many towns just on the edge of commuter distance to Saskatoon, Rosetown and the surrounding area is experiencing growth of its own, fuelled by a good location and a desire for a simpler, less expensive life, Arsenault says.

"Here, it's not all that rush, rush rush," he says. "Some young folks that are living in Calgary and Edmonton find out they can buy a home for $100,000."

It's not just retirees coming back to the town of 2,200 or Alberta businessmen travelling the province looking east to turn a profit. He says homes in the area are being sold to many young couples, some returning to the province, some not, who were turned off by the high prices and fast pace of bigger centres like Saskatoon, Calgary, and Edmonton.

"You don't worry about your kids walking out the door," says Rosetown's Mayor Brian Gerow, making his familiar sounding sales pitch for the town. "There are people that have lived here their whole life that never lock their doors."

In places like Biggar, the story is the same. People from all walks of life are touring the province looking for a quaint town to settle down in. They want services, schools, a short drive to a big city, a bit of industry, and health care. If they sell their homes in a booming centre, they can walk away with a tidy profit and gain a safe place to live.

"Houses are being snapped up very quickly here," says Bob Tyler, Biggar's town administrator. "It's been a pleasant surprise. People really seem to want an acreage and some horses."

Biggar, a town of around 2,000, has been getting much bigger, Tyler says.
Several retailers are considering opening up in the town because of the growth, which he says has been from people of all ages.

Mostly, he says, people are selling their homes in larger centres and buying in the area to "put some cash in their pockets."

Waldheim, which, at 60 kilometres from Saskatoon, was once considered too far away to feel the effects of a boom, has reinvented itself as a commuter town that's "worth the drive." A recent referendum there, fought over green space, has allowed for residential development in an old town park.

"Typically, with people moving from out of province, there is some connection to Saskatchewan," says Waldheim Mayor Kelly Block. "But we're seeing a lot of young couples moving here and commuting to Saskatoon."

Last week, Rosetown even had to call an emergency meeting to deal with several real estate proposals. The biggest proposal was the sale of "Little Banff," a campground and resort area on Hwy. 7. The buyers are three Calgary businessmen who are going to develop a $10-million Husky truck stop, a hotel, and a car wash. They're even thinking about opening a Tim Hortons franchise.

Gerow is also turning the former Fas Gas property into a Robin's Donuts.

Oil workers from Fort McMurray are also zeroing in on Rosetown and Biggar to live and Rosetown is trying to establish a direct flight there from the airport to accommodate.

For years, Rosetown had been in a sort of "depression," Gerow says. An aging and declining population, a tough run for farm life, and an exodus of young people to Alberta combined to cause a tough run for the area.

"We were dealing in a depressed rural bubble," he says. "It's a whole different world now."

The idea that sparked the growth, Gerow says, was selling many town-owned lots for $1 in order to stimulate growth and bring in tax dollars. People who buy the lots have to build on them within a year or lose a $1,000 deposit. The town office is getting two to three inquiries a day from people interested in building on them, he says. The Calgary group purchased five $1 lots and plans to build a four-plex housing unit on another. A new subdivision is also in the works.

"This is probably the most exciting time I've ever seen in Rosetown," Gerow says. "Everybody feels the same. There's an optimism that's just unbelievable."
© The Leader-Post (Regina) 2007

Tuesday, May 15, 2007

High Building Costs Push A Developer To Pull Contracts

A lower mainland home builder has pulled contracts to build homes from the purchasers, and then put them back on the market for $100K more. This of course did not sit well with the would to be home owners, and now the government has stepped in.
Full Article

Developer told to stop marketing Riverbend houses
Canadian Press
May 15, 2007

VICTORIA -- The British Columbia government is stepping in to help would-be home buyers jilted by a developer at a new housing project in Vancouver's eastern suburbs.

The Superintendent of Real Estate issued a cease-marketing order to CB Developments 2000 Ltd. yesterday, after the company cancelled presales contracts to dozens of purchasers at the Riverbend site in Coquitlam and refunded their deposits.

Finance Minister Carole Taylor said those who found themselves suddenly without a home "will at least know that there will be no reselling of their home until various issues under the [Real Estate Development Marketing Act] are followed.

"So it gives everyone breathing room, a chance to see exactly what the situation is [and] exactly what the contracts say."

The developer backed out of the presales agreements for the Coquitlam project by saying there was no way the builder could break even by selling at the original price.

Instead, the single-family homes were being listed again at current market values, a difference the buyers estimated at up to $100,000.

Real Estate Superintendent Alan Clark did not say what issues are being examined, but he did ask people affected by the order to contact his office with their concerns.

The act requires developers to file amendments to disclosure statements when material changes that affect an individual's decision to purchase a unit in the development are made.

The cease-marketing order prevents the sale of any units until the act is fulfilled.