Luxury Sales

Vancouver condo sells for record $18 million.

Bruce Constantineau
Vancouver Sun
Wednesday, October 24, 2007

An unnamed Portland, Ore. businessman has paid a record $18 million for a 48th-floor penthouse suite in downtown Vancouver.
The 7,400-square-foot unit in the Private Residences at Hotel Georgia won't be ready for occupancy until 2011, when the $400-million development near Georgia and Howe is completed.

Sotheby's International Realty Canada president Ross McCredie said the buyer wants to remain anonymous, but the Vancouver property will be one of several he owns throughout the world. "It's not the first time he's bought a penthouse suite in a big city," he said. McCredie said the unit will feature an "incredible" rooftop deck and custom finishings throughout the suite. Owners of the 155 condos in the development will also have access to services and amenities provided by a restored Hotel Georgia, including round-the-clock concierge and valet services.

McCredie said Vancouver billionaire Jim Pattison bought a unit in the project, as did former prime minister Kim Campbell. He wasn't certain what Pattison bought, but Campbell paid just under $2.5 million for a two-bedroom unit.

The $18-million price for the penthouse suite exceeds the amount paid recently for a 6,500-square-foot, two-level penthouse in the Fairmont Pacific Rim Vancouver. That unit is believed to have sold for well in excess of its $12-million asking price.

Potential buyers are mulling over a $17.6-million suite on the 60th floor of the Shangri-La development and an $18.2-million price tag for a 6,900-square-foot condo on the 26th floor of 1000 Beach Avenue. Three units on the 60th floor of the Ritz-Carlton project on Georgia Street have asking prices ranging from $10.8 million to $12.8 million while actor Jean-Claude Van Damme is believed to have listed his 7,500-square-foot suite on the 41st floor of the Shaw Tower for a whopping $19.8 million.

McCredie said more than half of the 155 units for sale in the Hotel Georgia project have been sold since sales began last Friday. More than $200 million in sales took place on opening day, with most being in the $2.5-million-to-$3-million range. "A lot of local buyers just gulp at those prices but international buyers are not as fazed," he said. "We constantly hear from international buyers that this price point is relatively cheap in their minds." McCredie plans to market more of the units next month during a sales trip to Abu Dhabi, Dubai and Moscow.

Vancouver condo marketer Bob Rennie said penthouse buyers constitute a market unto themselves. "They're high-net-worth individuals with a lot of discretionary money who want the absolute best," he said. "It's often a second, third or fourth residence for them."I know people hate these terms but as Vancouver becomes more of a world-class city and resort city, the take-up of these units is becoming stronger".

Market Review

BC Home Sales Increase in September.
Vancouver, BC – October 18, 2007.

British Columbia Real Estate Association (BCREA) reports residential sales volume on the Multiple Listing Service® (MLS®) in BC climbed 20 per cent to $3.42 billion in September, compared to the same month last year. Residential unit sales increased 6.8 per cent to 7,687 units during the same period. The average MLS® residential price reached $445,205, up 12.3 per cent from September 2006.

“Housing demand hasn’t let up after a record-breaking summer,” said Cameron Muir, BCREA Chief Economist. “While the number of homes for sale has increased since last year, the sales-to­active-listings ratio has remained unchanged. This means homebuyers are snapping up additional inventory at the same pace, and upward pressure on home prices is continuing.”

“Strong economic conditions are underpinning BC home sales,” noted Muir. “Robust job growth, low unemployment and rising wages and salaries are bolstering consumer demand.” More than 70,000 jobs have been created in the province over the last year, while the unemployment rate hovers near an historic low. The average weekly wage in BC climbed 3.3 per cent in September, compared to the same month last year.

Year to date, MLS® dollar volume increased 18 per cent to $36 billion compared to the same period last year. Residential sales rose 4.9 per cent to 82,627 units, while the average residential price climbed 12.5 per cent to $436,062.

Market Update

Slow and steady growth forecast for residential real estate Canadian home sales to top 500,000 in 2007.

Kelowna, BC (October 17, 2007)

After posting extraordinary gains in 2007, housing market performance will moderate in most major Canadian centres in 2008, according to a report released today by RE/MAX.

The RE/MAX Housing Market Outlook 2008 examined residential real estate trends in 18 markets across the country. The report found that while economic prospects will continue to improve next year, few major markets are expected to exceed record sales levels set in 2007. Winnipeg, Hamilton-Burlington, Kitchener-Waterloo, London-St. Thomas, Ottawa, Sudbury, Saint John, Halifax-Dartmouth, and St. John’s are all predicted to buck the trend in 2008, with appreciation ranging from one to seven per cent. Average price is forecast to increase in 78 per cent of markets surveyed next year, with the lowest price increase expected in Edmonton and the highest in St. John’s.

Nationally, the number of homes sold is expected to break through the half-million threshold in 2007, climbing 13 per cent to an estimated 545,400 units, up from 483,770 units one year ago. Average price is projected to appreciate nine per cent to $303,000, up about $25,000 over 2006 levels. In 2008, home sales are expected to retreat to 500,000 units while Canadian housing values are forecast to continue their ascent, rising six per cent to $321,000.

“Clearly, economic prosperity has translated into increased housing sales and upward pressure on prices across the board,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “The country’s economic engine fired on all cylinders throughout the year, despite dire conditions south of the border. As in 2007, inventory will be the major wildcard next year—the ultimate variable most expected to influence housing market conditions and performance. A return to tight market conditions could mean all bets are off as buyers are forced to compete, creating increased market pressure.” Major market frontrunners for price appreciation in 2008 include St. John’s (12 per cent), Regina and Kelowna – Central Okanagan (nine per cent), Hamilton-Burlington and Saint John (eight per cent) and Greater Vancouver (seven per cent). Leading the country in sales growth next year will be Kitchener-Waterloo (seven per cent), followed by Hamilton-Burlington, London-St. Thomas, Sudbury and Halifax-Dartmouth, each forecasting a five per cent gain. Higher mortgage rates and increased inventory levels failed to materialize in most major centres, making 2007 a record year for real estate activity in Canada.

By year-end, housing values across the country are expected to shatter existing records. Serious double-digit increases in average price are forecasted for Saskatoon (49), Edmonton (31.5), Regina (21), Calgary (20), Sudbury (20), Kelowna (19.5) Saint John (17), St. John’s (12), and Greater Vancouver (10). Saskatchewan dominated real estate news in 2007, reporting some of the highest percentage increases in unit sales. The number of homes sold in Regina by year-end is expected to top 35 per cent, bringing sales to an estimated 4,000 units. Neighbouring Saskatoon is forecast to climb 28 per cent to 4,400 units in 2007. Other centres expected to post double-digit gains in activity include Saint John (19 per cent) Kitchener-Waterloo (13 per cent), Halifax-Dartmouth (12 per cent), St. John’s (11 per cent), and Toronto (10 per cent).

“Western markets were first out of the gate in 2007, but those in the East followed suit,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada. “By year-end, some of the most impressive gains in home sales will be realized in Ontario and Atlantic Canada. Solid economic fundamentals, including billions of dollars in capital projects, a positive unemployment outlook, and solid consumer confidence levels will propel markets forward. A slow and steady growth trajectory, minus the peaks and valleys experienced in 2007, is forecast for next year.”

RE/MAX is Canada's leading real estate organization with over 17,500 sales associates situated throughout its more than 640 independently owned and operated offices across the country. The RE/MAX franchise network, now in its 34th year of consecutive growth, is a global real estate system operating in over 65 countries. More than 7,000 independently owned offices engage 120,000 member sales associates who lead the industry in professional designations, experience and production while providing real estate services in residential, commercial, referral and asset management. For more information, visit: www.remax.ca.

Luxury Sales

Demand for luxury homes through roof. 123 houses sell for more than $3 million in Vancouver area alone.

Frank Luba
The Province
Tuesday, October 16, 2007.

Sales of luxury homes in B.C. are hot.
So far this year 59 homes have sold for more than $3 million in West Vancouver, and 64 on Vancouver's west side. In all of 2006, just 50 sold for more than $3million in West Vancouver, and 64 on the west side.
There's more demand than supply, top-end realtor Allan Mark Angell, who usually has 35 to 50 luxury listings, said yesterday. "I have 17 to 18 right now," said Angell, who specializes in luxury sales in West Vancouver and the west side. "I'm knocking on doors to find expensive houses. "The reason it's kept going is lack of product. If you want oceanfront in close, good luck in trying to find one. After one that's $14.8 million, that's it."

B.C. leads Canada in asking prices, with 124 properties listed on MLS.ca at $5 million or more. Ontario has 45 properties at that level and Alberta 22.

Topping the list of B.C.'s most expensive homes is a $28.5-million waterfront home in the Uplands neighbourhood of Oak Bay. Others among Canada's top 10 include a $25-million Shaughnessy estate in Vancouver; an oceanfront home in Metchosin for $24 million; two Whistler homes valued at $22 million and $20 million; and one in Saanich at $18.5 million.

Angell said he knows a property in West Vancouver that closed in March for $5.3 million. Two months later he brought the owner an offer for $7.2 million that he rejected.

In Whistler, Ann Chiasson of Sea to Sky Premier Properties said: "The big picture on the luxury market is it's good."
Angell, a realtor when prices crashed in 1981, saw lots of product and interest rates at 18 per cent.
"Now our rates are still good and we don't have a big increase in product," he said. "So what's going to change the market?

"I don't see anything on the horizon that's going to change it. Yet everybody is saying it's about to."
Senior market analyst Robyn Adamache of the Canadian Housing and Mortgage Corp. said population growth and jobs are driving B.C.'s strong housing market. "We're still seeing very high demand for housing and that's being fuelled mainly by strong levels of migration coming into the region, as well as a vibrant economy that's creating a lot of jobs," said Adamache.

Disclosure ordered for 'pre-sale' developers.

Disclosure ordered for 'pre-sale' developers. Rules call for buyers to get more information on agreement provisions.

Bruce Constantineau
Vancouver Sun

The B.C. Financial Institutions Commission has ordered developers to provide increased disclosure to buyers of "pre-sale" condominiums which have yet to be built.

The new measures, to take effect Nov. 1, follow the controversial cancelling of 32 pre-sale contracts this year on the Riverbend project in Coquitlam. The developer - CB Development 2000 Ltd. - claimed rising construction costs outstripped sale prices and would have forced massive losses if the sales were completed. The disclosure rules force developers to explain any provisions for terminating, extending or assigning purchase agreements. Buyers will be required to initial the cover page of disclosure statements to confirm the provisions were drawn to their attention.

Pertinent information must also appear in "conspicuous type" on the statement's cover page.

THE RULES ALSO PROVIDE FOR MORE DISCLOSURE OF DEVELOPERS' BACKGROUND, INCLUDING:
- Their experience in the development industry.
- Whether they have been bankrupt in the past five years or been disciplined in the past 10 years for matters relating
to real estate, mortgages of land, securities, theft or fraud.
- Whether any conflict of interest exists that could affect a buyer's purchase decision.

Failure to comply with the disclosure requirements could result in the issuance of cease-marketing orders or "administrative penalties" of up to $50,000.

Greater Vancouver Home Builders chief executive officer Peter Simpson welcomes the new disclosure rules.
"If there's something in a developer's background -- like he went bankrupt or committed fraud in the past - what's wrong with making that public?" he said in an interview. "It just makes more information available to home buyers so they can make an informed decision ... . It's important they know there's a slight potential for something to go wrong."
But Simpson said home buyers also have to take responsibility for their own actions, noting many buyers never even read the details of long purchase contracts. He said condo buyers in lineups often get caught up in the excitement of the moment and can feel pressured to buy on the spot. "Once that excitement and emotion passes, you need to step back and take that purchase contract to a lawyer to have them review it," Simpson said. "If there's anything that appears to be problematic, you can deal with it or just walk away from the contract if you're not satisfied."

Home buyers in B.C. have a seven-day right of recision, which allows them to rescind a purchase agreement for any reason within seven days. Vancouver lawyer Brian MacKay said giving buyers more information about pre-sale projects is probably the best solution available now. "Inexperienced developers will have more trouble selling to knowledgeable purchasers because they'll be wary of prices that seem too low or too good a deal," said MacKay, with Davis LLP. "Purchasers will know there's a substantial risk in today's climate that the product might not be delivered."

Market Review

Housing Starts Move Higher in September.

OTTAWA, October 9, 2007 — The seasonally adjusted annual rate1 of housing starts was 278,200 units in September, up 19.6 per cent from 232,700 units in August, according to Canada Mortgage and Housing Corporation (CMHC).

“The rise in September housing starts reflects a strong multiple starts segment,” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “In particular, the robust results achieved this month can be mostly attributed to increased condominium starts, which reflect strong condo sales over the past 12 to 24 months. Despite this sizeable growth in September, we continue to expect that housing starts will decrease gradually between now and the end of 2008.”

The seasonally adjusted annual rate of urban starts increased 22.9 per cent to 244,400 in September, compared to August. Urban singles were down 4.3 per cent to 90,300 units in September, while multiple starts increased 47.5 per cent to 154,100 units.

In September, the seasonally adjusted annual rate of urban starts increased in all five regions. Urban starts registered an increase of 3.0 per cent in the Atlantic region, 46.0 per cent in Quebec, 23.6 per cent in Ontario, 11.1 per cent in the Prairies, and 15.8 per cent in British Columbia. Urban single starts were down in all regions except Quebec, where single starts were unchanged at 16,400 units. All regions saw double-digit increases in urban multiple starts with Quebec leading the way with a 75.2 per cent increase.

Rural starts were estimated at a seasonally adjusted annual rate of 33,800 units in September.
Actual starts, in rural and urban areas combined, were up an estimated 0.2 per cent in the first nine months of 2007 compared to the same period in 2006. In urban areas, actual total starts grew by an estimated 1.2 per cent year-to-date. Single starts growth was -4.7 per cent while multiple starts grew by approximately 7.0 per cent.

1 All starts figures in this release, other than actual starts, are seasonally adjusted annual rates (SAAR) — that is, monthly figures adjusted to remove normal seasonal variation and multiplied by 12 to reflect annual levels.

As Canada’s national housing agency, Canada Mortgage and Housing Corporation (CMHC) draws on over 60 years of experience to help Canadians access a variety of quality, environmentally sustainable, and affordable homes — homes that will continue to create vibrant and healthy communities and cities across the country.

Commercial Real Estate

Korean developer adds to Infinity.
Two new Sky Towers will go up across the street from highrise Surrey condos.

By Michael Kane
Vancouver Sun
Thursday, October 04, 2007

Surrey's Central City area will get the two tallest towers between Vancouver and Calgary under plans unveiled Thursday by a Korean businessman.

The 36-storey and 40-storey residential Sky Towers will be directly across the street from the five Infinity highrises being built at the King George SkyTrain station in the formerly run-down Whalley neighbourhood.
With the first Infinity tower ready for occupancy in January, and four more towers on the way, the addition of the Sky Towers enhances the city's goal of turning Central City into Surrey's downtown community, Mayor Dianne Watts said in an interview.

"This really fits into our vision for our city centre," Watts said. "The seven towers here are going to be just the cornerstone for the whole entrance into city centre." She said applications are being processed for several more towers, both residential and commercial, over the next five years.

Hee Yong 'Edmond' Yang, who operates a 2,000-outlet fried chicken franchise in South Korea, took over the Infinity project after the previous developer, also Korean, faltered under a heavy debt load.
Designed by Patrick Cotter Architects, Sky Towers will contain 900 one and two-bedroom suites, as well as 56 townhouses, with studios starting at $179,900.Each tower will include a 1,000-square-foot rooftop solarium with 50-foot glass atriums, along with a 4,000 square foot rooftop patio offering unrestricted views.

The 36-storey Sky Tower is scheduled for completion in 2010, followed by the 40-storey tower.

"With Sky Towers and the Infinity project, we're looking to build a dense urban mecca," said Cameron McNeill of MAC Real Estate Marketing Solutions. At its heart is the Surrey campus of Simon Fraser University, along with shops, restaurants, and recreational facilities, all within walking distance of SkyTrain."If we look ahead five or 10 years, Central City is going to be one of the most significant urban centres in Western Canada," McNeill said in an interview.

"Surrey is one of Canada's fastest growing cities and this is their downtown core." Unlike Burnaby's Metrotown, which he likened to a mall surrounded by residential highrises, McNeill said Central City will become "a fully-integrated urban centre in a most modern sense, a mini downtown Vancouver." With 150 homes priced at less than $250,000 - almost half the cost of similar units in Vancouver - he said it will also be highly affordable.

By "trying to deliver high-quality residences at affordable prices," Yang, 46, is living up to the three principles that have governed his life, said his spokesperson, lawyer Byron Lee. "First of all you have to be a good person with a good heart. Secondly, whatever you do, you should try to do things righteously and honestly. Thirdly, you shouldn't be in business only to make money but you should aim at benefitting others."

Lee said Yang, who immigrated to Canada with his wife and three children in 2002, is looking for opportunities to build additional homes in the area."He thinks Central City will become a vibrant downtown community. It's very livable with a lot of amenities."

Market Update

Buyers fuel continued growth in Greater Vancouver housing market.

Vancouver, B.C. October 2, 2007 – The Real Estate Board of Greater Vancouver (REBGV) reports that total residential sales of detached, attached and apartment properties reached 2,776 units in September 2007, an increase of 10.2 per cent compared to 2,519 sales in September 2006.

The inventory of residential properties listed for sale remains stable, with an overall year-to-date increase of 4.1 per cent to 45,054 residential units listed between January and September 2007, from 43,264 for the same period in 2006. The number of new listings increased 8.2 per cent to 4770 in September from 4408 in August of this year.

“There is no single demographic of buyers. They include first-time buyers, people choosing to take advantage of current home equity to ‘move up’ in the market, as well as people coming into Greater Vancouver from other areas. Our data indicates that the majority are purchasing a principal residence,” says REBGV president Brian Naphtali.
“There’s a great deal of choice in the market for a range of consumers today,” explains Naphtali. “While 45 per cent of homes for sale are priced at below $500,000, there are also a significant number - 37 per cent - listed in the $500,000 to $1-million range. Of the active listing inventory of more than 11,000 residential properties, approximately 18 per cent are priced above $1-million.”

According to Multiple Listings Service® (MLS®) data, sales of apartment properties increased by 7.7 per cent to 1,177 sales in September 2007 compared to 1,093 sales in September 2006. The benchmark price of an apartment property in Greater Vancouver, calculated by the MLSLink® Housing Price Index, is $371,718 up 11.1 per cent from one year ago.

Sales of attached properties increased by 27.6 per cent in September 2007 to 500 sales, compared to 392 sales in September 2006. The benchmark price of an attached unit is $452,944, up 10 per cent from a year ago.
Sales of detached properties increased by 6.3 per cent in September 2007 to 1,099 sales, compared to 1,034 sales in September 2006. The benchmark price of a detached unit is $737,927 up 11.9 per cent from last year.

Bright spots in Greater Vancouver in September 2007 compared to September 2006:

DETACHED:
Maple Ridge/Pitt Meadows up 11.8% .......(133 units sold, up from 119)
Richmond up 29% ..................................(147 units sold, up from 114)
Vancouver East up 22.9%........................(172 units sold, up from 140)

New Westminster up 38.1%.....................(29 units sold, up from 21)

ATTACHED:
Burnaby up 38% .........................................(69 units sold, up from 50)
Port Moody/Belcarra up 142.9%....................(34 units sold, up from 14)
Richmond up 38.6% ....................................(115 units sold, up from 83)
Vancouver West up 70.7%............................(70 units sold, up from 41)

APARTMENTS:
New Westminster up 17.4% .........................(81 units sold, up from 69)
Port Moody/Belcarra up 39.1%......................(32 units sold, up from 23)
Whistler/Pemberton up 188.9%.....................(26 units sold, up from 9)