The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in Greater Vancouver totalled 3,559 in September 2009, an increase of 3.4 per cent from the 3,441 sales recorded in August 2009, and an increase of 124.5 per cent compared to September 2008 when 1,585 sales were recorded.

“As homes sales in Greater Vancouver continued at an elevated pace in September it’s encouraging to see that more homes were listed on the MLS® in the month than any other so far this year,” Scott Russell, REBGV president said.
New listings for detached, attached and apartment properties in Greater Vancouver totalled 5,764 in September 2009. This represents a 6.2 per cent decline compared to September 2008 when 6,142 new units were listed, but a 26.8 per cent increase compared to August 2009 when 4,544 properties were listed on the Multiple Listing Service® (MLS®) in Greater Vancouver.

At 12,596, the total number of property listings on the MLS® increased 5.5 per cent in September compared to last month and declined 36 per cent from the 19,852 homes listed for sale during the buyer’s market that was experienced at this time last year.

“During this period of renewed demand in our marketplace, home values have gradually recovered from the declines that occurred in 2008,” said Russell.

Since the beginning of the year, the MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver has increased 13 per cent to $547,092 from $484,211, while home prices compared to Septembers 2008 levels are up 1.6 per cent.

Sales of detached properties increased 160.6 per cent to 1,423 from the 546 detached sales recorded during the same period in 2008. The benchmark price, as calculated by the MLSLink Housing Price Index®, for detached properties increased 2.1 per cent from September 2008 to $741,632.

Sales of apartment properties in September 2009 increased 94.9 per cent to 1,489, compared to 764 sales in September 2008. The benchmark price of an apartment property increased 1.5 per cent from September 2008 to $374,686.
Attached property sales in September 2009 are up 135.3 per cent to 647, compared with the 275 sales in September 2008. The benchmark price of an attached unit increased 0.4 per cent between Septembers 2008 and 2009 to $466,276.

Click here for the complete Stats Package

Welcome to VistaPlaceCondos.com a website dedicated to the residents and future residents of Vista Place's twin towers in the heart of Central Lonsdale. Vista Place, located at 158 West 13th Street and 1320 Chesterfield Avenue will forever change the way we look at Central Lonsdale, once dominated by low-rise buildings Vista Place has brought Central Lonsdale to the forefront of modern condo living.

MODERATOR: Talk a bit about the current climate for first-time home buyers.
PHIL SOPER: First-time home buyers are coming back in to the market. In California there's been a 200% increase in first-time home buyers. And here we're seeing an amazing uptick across the country. The housing market was stalled; there was sand in the gears. If first-time buyers aren't getting into the market, entry level buyers can't move up, and middle level homeowners can't get into luxury homes. Which is why public policy is focussed on first-time buyers. Public policy in Canada favours first-time buyers, because if they come back into the market, the entire market improves. So, first-time home buyers are making use of these tools: accessing the RRSP transfer, land transfer tax rebates, and taking advantage of improved affordability in places like Vancouver.
BRAD LAMB: There are pressures on first-time buyers that do not help the situation. The city of Toronto made a really bone-headed move when they added a second land transfer tax. And Ontario's harmonization of PST and GST was also really dumb. First-time home buyers are getting stung. I had a sale recently of a 700 square foot condo to a dentist in Yorkville, with 10% down. It was a $600,000 sale, so she was hit hard by the tax, which kicks in at $400,000+ properties.

MODERATOR: Is there a good time to buy?
PHIL SOPER: It depends. Where are you? Do you have a job? What's your personal situation? For speculators, it's not a good time. For those hoping to move up, you might lose 20% on your existing property, but if you're moving up to a more expensive home, that 20% discount will outweigh whatever you lost on your current property's sale. It's simple math. It makes sense to move up. And for first-time buyers, as we already discussed, it's a great time.
BRAD LAMB: Consumers are terrified that they'll lose money. But they can be confident that the market has bottomed out. Over the past five months we've gotten rid of all the sellers that had to sell because of divorces, job losses etc. Most of these cases are gone - they've sold. There are virtually no power of sales in the city. No pressure for prices to fall.
PHIL SOPER: Interest rates will not go any lower, or if they do, it'll be so incremental as to not have much impact. And home prices will rise very slowly as well - probably around the rate of inflation. There are always exceptions - in St. John's NF, home prices rose 15% in the first quarter of this year. But real estate is a neighbourhood business. It's all about conditions in your region of the country.
DONALD E. LAWBY: It's a great time to buy, depending on where you live. What's going to provide buyers with a level of comfort is based on their community. First timers need to find a patient realtor, and a great lender. With interest rates where they are today, and the economy looking like it's stabilizing a bit, the Toronto market might be getting back to where it was at this time last year. But it's a very local decision.
SAL GUATIERI: If you're confident you'll keep your job, or you're looking in an area that isn't inflated, you should look. But you don't need to rush into the market. Be patient and find the best deal you can.
BRAD LAMB: People who are buying real estate are buying a home to have a life. The big mistake is not to buy. It's a home: you shouldn't be constantly checking your net worth. The average sale price numbers are not a good guide to prices, because there isn't a lot on the market.

MODERATOR: Can you talk a bit about buyer/seller behaviour in this market?
DONALD E. LAWBY: Consumers come to market truly informed and engaged with significant knowledge they've gotten by looking at inventory on the Net. Sometimes they know more about a specific product than the agent, but what they don't know about is the market. And they want to know about all the products out there. Agents have to provide them with as much information as they want, and when it comes to recommending a lawyer for example, they don't want the names of three lawyers, they want you to recommend one. Agents have to justify their worth to clients, who come prepared to play, not just observe.
PHIL SOPER: What we know about the first-time homebuyers is that they're Gen X - in their 20's to early 40's - and the kids of baby boomers. That's the first thing to remember: their parents moved an average of every 5-7 years so they grew up thinking of investing in real estate as a normal part of life. Secondly, they are skeptical by nature, and constantly question authority; and thirdly they are highly skilled researchers. They want realtors to back up everything they tell them, and come armed with lots of information. Realtors need to marshall all that info into a manageable package.
BRAD LAMB: I got my first website - www.torontocondos.com - back in 1995, and started using it in 1998, and homebuyers still come to us just as misinformed as they did back in '98. They're as intimidated as they always have been, and we tell them it's no time to try something new.

MODERATOR: Any predictions as to where the market is going in the next while?
PHIL SOPER: We have to be careful in this correction. The end of the third quarter of 2007 was the market peak. Now we're coming up to the 7th quarter of the correction which will tie as the longest period of correction in contemporary real estate history. It's already lasted a long time.
BRAD LAMB: Investor presence is no longer strong in the condo market. Construction starts are based on multi-unit condo sales and there hasn't been a successful condo sale since August 2008, and there won't be another until spring 2010. There'll be very few new condo sales in Toronto in 2010-2011, because there will be very little building in the next 18 months. We haven't seen the impact yet on the construction industry, but it's coming. The inventory is still being well absorbed so I don't see any catastrophic event for condo owners. In fact, I forsee a shortage of condos in Toronto by 2011. DONALD E. LAWBY: Housing corrections in the past have involved high interest rates and unemployment. There's an absence of these two things in this recession. There's only been a single digit decline in house prices in most markets, so far. Governments have stomped on inflation rates ad kept them down. So the ups and downs will be less severe than in the past.

MODERATOR: Any last words of advice for first-time homebuyers?
BRAD LAMB: Conquer your fear!
PHIL SOPER: It's easy to get carried away when we are no longer supply-strapped. But remember it's not fun to be cash-strapped, or house-poor. Shop below your limit, because with real estate, emotion takes over and people can and will spend more than they should.
SAL GUATIERI: Don't buy more house than you can afford. Don't rush into things. If your situation is uncertain, wait until we know what the economy is doing.
DONALD E. LAWBY: Get experts to help you. And after asking all your questions, ask the most important one: is there anything else I should be asking?

VANCOUVER, B.C. . March 3, 2009

Residential housing sales in Greater Vancouver rose 94 per cent in

February compared to the month before, with 1,480 sales registered in February compared to 762 sales in January, which was the slowest month for housing sales in 25 years. Over the past 10 years, February sales have typically surpassed January by an average increase of 53 per cent.

At the same time, new MLS® listings for residential properties continued to decrease for the fourth month in a row. New listings decreased 25.6 per cent in February compared to the previous year; 20 per cent in January; 8.6 percent in December; and 10 per cent in November.

There are terri! c opportunities out there right now, but with property listings continuing to decrease, those op- portunities may be available only for a brief window of time,. said Dave Watt, president of the Real Estate Board of Greater Vancouver (REBGV).

REBGV reports that year-over-year property sales in Greater Vancouver declined 44.7 per cent in February 2009 from the 2,676 sales recorded in February 2008. Year-over-year, those are the lowest sales ! gures for February since the mid-1980s.

REALTORS® are reporting more activity compared to recent months as people begin to see whether their posi- tion in the housing market has strengthened as a result of falling interest rates and improved affordability,. Watt says. .It took, on average, 67 days to sell a home in Greater Vancouver in February, seven days less than last month, but behind the seller.s market of last February when the average stood at 33 days. Sales of detached properties in February 2009 declined 41 per cent to 587 from the 995 units sold during the same period in 2008. The benchmark price, as calculated by the MLSLink Housing Price Index®, for detached properties declined 14.2 per cent from February 2008 to $653,452.

Sales of apartment properties declined 45.6 per cent last month to 650, compared to the 1,197 sales in February 2008. The benchmark price of an apartment property declined 13.9 per cent from February 2008 to $333,143.

Attached property sales in February 2009 decreased 49.8 per cent to 243, compared with the 484 sales during the same month in 2008. The benchmark price of an attached unit declined 9.7 per cent between Februarys 2008 and 2009 to $426,268. New listings for detached, attached and apartment properties declined 25.6 per cent to 3,916 in February 2009 compared to February 2008, when 5,260 new units were listed.

-30-

Clich here for the complete stats package

Expired North Vancouver Townhomes: 8*

Current North Vancouver Townhome Listings: 125

*Don't be a statistic. Ensure your Townhouse is Exposed to Buyers. Marketing is Everything.

When: March 24, 2009, 7-9pm

Where: John Braithwaite Community, 145 West 1st Street, North Vancouver, Harborview Room

Who: Jacqueline Baker-Mortgage Broker, Laura Holland-Real Estate Lawyer & Craig Rushton-Realtor

Who should attend: Anyone considering buying a home in the next year

Topics to be covered include: The mortgage process, pre-approval to completion, How to search for a home, the Buying process, things to avoid, closing costs, legal entitlement. Q & A to follow. Refreshments to be served.

Seating is limited. Please RSVP to craig@craigrushton.com

Stay tuned for more info.

Have you heard about www.BuyingandBlogging.com?

By Derrick Penner, Vancouver Sun

Metro Vancouver's real estate markets turned in 2008, which has meant falling sales and declining prices since late last spring.

Now, with gloomy economic developments dominating the news, uncertainty reigns over what is going to happen in real estate markets and when a recovery might be expected. The Vancouver Sun wanted to take a longer-term view. 

The Sun invited to its editorial offices a panel of experts in Polygon Homes chairman Michael Audain, top realtor Patsy Hui with Re/Max Westcoast, and Tsur Somerville, director of the centre for urban economics and real estate at the Sauder School of Business at the University of British Columbia.

The conclusion of their discussion: The economic turmoil will continue having an impact on markets, and prices will keep declining. But at some point they will have to "unfreeze." Sales will pick up as people have to buy and sell property for family reasons.

In the longer run, that normal activity, coupled with Metro Vancouver's attractiveness as a destination for immigrants, give the region a solid basis for real estate markets to grow back from.

Here is a full transcript of the discussion:

• • •

Question: On prices, do you think they will stabilize any time soon, have you seen any signs of that?

Michael Audain: I think Patsy knows a lot more about it than I do, she's closer too it every day whereas I tend to look at the reports from our sales offices and talk to my colleagues in the industry.

I think the first thing to deal with is volume. The volume of sales was as low as I can remember it in about 27 years for October, November, December and January. The market was almost frozen. But we've noted in February the volume does seem to be picking up, particularly in the city of Vancouver and Richmond. That's usually where, in the past, it has picked up first and tends to spread.

So, I expect the volume to increase, the volume of sales, as the spring goes on.... You can't have frozen markets for very long, because eventually some people have to buy or sell. New families are being formed, families are splitting up, people are coming to town, people are leaving town and they have urgent reasons to make a transaction. So the volumes will pick up over the course of the year, I do believe that.

Q: As a result, do you think prices will stabilize?

MA: I think the price stabilization comes later. You have to have volume for a while, and to get volume also, people need to get their prices down to a level that the consumer thinks that they're a bit of a bargain. Because the home buyer right now is somewhat apprehensive. There is a lack of confidence in the market and a belief that prices will continue to fall. So prices have come down, and in they may have, in some areas, some way to go. In terms of when prices will stabilize, I think it is quite likely that by the third-quarter of this year we'll see general price stabilization, if all things hold equal. Of course they don't.

But I'm fairly confident, based on other market corrections I've lived through and traded through in the Greater Vancouver area, by the third-quarter we'll see price stabilization, if not price increases. In our own cases, we are, in some areas, starting to increase prices again after we got significant volume of sales and started new projects and we're starting to inch prices up.

Q: [To Patsy Hui] From your vantage point, what do you see?

Patsy Hui: I have about the same length of experience in the market, 25 years coming up, and of course everybody - including buyers are so familiar with this, the 31 years [holding up REBGV 30-year price graph]....

I don't think anybody in this world, and I'm talking about the world this time because it's a worldwide thing, can really tell you what's going to happen and when it's going to stabilize. I'd like to tell buyers that it's already doing so, but I honestly always tell my clients to purchase, there's two criteria: first, you can afford the payments for the next five years, and also that you love the place.

Because it doesn't matter whether you bought it right here at the height of the market ? crash in two years. Yet again, if you stay put, just trade up, trade down, stay in the home, 25 years later it's your retirement income. If you wait, say a year or two, with headlines like this [holds up photocopy of Sun headline] that you guys did...., who's going to buy? This instills fear in people. But if we don't have things like this ... we actually encourage this is a great time to buy. Two days ago, Global did a segment that there's a buying frenzy. I love it. And Ming Pao, Feb. 11, it's like a mini spring fever in the housing market. I love it, I carry it with me all the time showing clients that 'look, it's a great time to buy', and it is. Interest rates this morning, I got a client telling me he got 2.4 per cent. When I came to Canada, it was three per cent. Why wouldn't you buy? Why wouldn't you want to live in your own place and pay your own mortgage. And the earlier you buy, the earlier you retire from your mortgage days. I can't see any better time than now, and I can feel it, because it was in the news. The number of sales per day versus the first part of February ... increased from 30 to 68.

Do you really want to wait until the price start going up? Because honestly, I'm with clients every day: buyers and sellers. One family I'm working with, they've never dreamt of moving into Vancouver West. Vancouver West last year, I have a listing listed by someone else who got a $1.35 million offer last year. A Dunbar home, 50 by 133, $1.35 million just for knock down. They turned it down because at the time it had been listed in February by another agent for $1.598. And now, I'm listing it for $898,000. The highest offer we've had was $862,000.

So, imagine. Last year, $500,000 difference. Nobody would think about moving into Vancouver West, now they could. They could sell their place a lot lower, say 10-15-20 per cent. But 10-15-20 per cent of what they want to upgrade into is that much more.

Q: So you need to see transactions, you need to see turnover before you can see any price stability?

PH: It will come, it will come. Like I said, a lot of people all of a sudden realize. Six months ago, we weren't able to tell sellers.... they should come down. For example, one house I'm selling in Richmond, shortly after we listed in August, we had $598,000 and we had a $550,000 offer right away, which the seller turned down..... Of course last year, after that six months of really good, including July was really good, how do you convince a person they can come down from $598,000 to $550,000. By the time we actually wanted to accept it, the buyer said 'maybe we should have a subject to sale of their Vancouver East property,' and it just slid down. Finally we accepted a $450,000 offer, and it was totally willing and pushed by the seller, not by me.

The seller's willing because she's going to grab her money and go do something else. I did a .... I do small deals to big deals, .....

People are willing to take lower offers because they grab the money and go do something else. That's really a realization. I don't think sellers are admitting that they lost. The way I come across to sellers is that they've actually gained.

Q: FM because the run up in the last seven years, clearly they are net beneficiaries....

PH: People are gaining. And most people in the market are moving up. Very few people are moving down. So, basically, when Richmond lost 10 per cent an average of $600,000, $60,000 or $120,000, 20 per cent. Vancouver West, $1.5 million, 20 per cent is $300,000. They just gained. So, nobody lost.

Tsur Somerville: My sense is they haven't stabilized yet. They have further to fall. Michael is absolutely right, when you look at the resurge, you need to get change in sales before you get change in prices. Sales always lead prices.

We saw in this market that sales started dropping before prices started dropping, and its going to in a way, work the same process. I think it's a little hard to figure out right now what's going on, because you had, October to December, abject fear in the developed world about everything. And anyone in that kind of climate is not going to go out and make a major investment. And from Dec. 20 to Jan. 15, you couldn't actually drive your car on any side street anywhere in the Lower Mainland, so there weren't going to be any sales either. So clearly, right now, everything I hear is that things are up from where they were, but figuring out what part of that is just a recovery and what part is a real change in direction is going to be hard until we can compare sales numbers now with where they were in the summer.

We have this 50-per-cent drop, and are we recovered from that. At least the early indications suggest if there is a decline, the decline has slowed dramatically and sales are much closer to having sort of bottomed out, but that's not the same as turning around.

MA: Could I just mention that another indication of a direction of the public interest is that our sales offices have been very busy over the last two or three weeks. I think we had about 500 parties through our sales offices last week, and that is.... and it is resulting in deals. But those people are, quite rightly, taking time to shop and compare in terms of what's available in the market. But certainly it is resulting in increased sales for us, substantially increase. And whether the trend will continue, I don't know. But it's happening right now.

Of course I have no difficulty in advising close friends and family to buy a home now with interest rates down at levels that I would never have thought believable and with the price corrections that have happened in the market. So I strongly believe that if someone is to buy a home, in five years from now it's going to look like a very smart decision. If they're not prepared to live in that condo or single family home for five years, then they should not be buying, that's what I tell them.

But there's a group of people who somehow try to somehow outsmart the market with their own home. They sort of want to play the market and buy on the bottom and the sell on the top. So you can't convince them because they will take their time and will probably be buying when the market's already started to heat up again, whenever that happens.

The other thing, I don't know about you Patsy, but we're finding now there's a lot of first time buyers coming to our homes, and of course we love them because they don't have a home to sell. They're renting, and in many cases, they can now buy something for a monthly payment comparable to their rent if not lower.

Q: Patsy, are people easily getting pre-approved? That is one of the concerns being raised about whether in fact credit is moving, banks are lending, so what do you see on the ground?

PH: I actually deal with quite a few second-generation buyers as first time buyers now. And because of their job stability, ..... Banks only look at how long they have been working, not how long they will be working. Because nobody can tell that. I actually really haven't... it might be the type of clientele I'm dealing with is not risky, or their not (?) they're from Mainland China.

Q: So they're getting pre-approved?

PH: Yes, no problem. The only hiccup... is commercial. Commercial, they are starting to really, really make it very difficult. We couldn't even do a.... I talked to a couple of banks trying to do buy downs. We're back to that stage [we were at] 10 years ago, interest-rate buy downs....

Banks, a little bit more cautious about schemes like that.

MA: We're finding that people who have employment have no trouble getting mortgages from banks and credit unions. We're very fortunate in Vancouver, because I don't think that is the case in the United States. But here there seems to be no difficulty in getting qualified people approved for quite large-ratio mortgages.

TS: Part of what's being missed is the element of the market that was a big piece of the froth and is now not able to participate. When you're looking on the investment side, from what I hear and what I've been told, the banks are much stricter on providing funds for people who are not going to be owner occupiers. So there's a piece that was an important piece of driving the market in the aggregate, not for individual projects and I doubt particularly for your projects they were as much of a piece versus some of the high rise towers, and that's a market where the financing is really hard to get. The investment side is completely dried up.

And then borrowers who say, two years ago or even a year ago, might have been able to get high LTD loans thought they didn't have great credit scores, those people are frozen out of LTD numbers.

It's not that credit that has completely disappeared, but there is a slice of buyers who are not able to access the market in the way they once did, which can have an effect in the aggregate.

Q: You talked a lot about confidence you will see higher volumes of sales in the spring, what do you see as the key factor that will bring buyers back?

MA: I think you can only freeze the market, as I mentioned before, for so long. And then there is a need for people to secure accommodation and also, lets face it, people who have participated in the market over time have done very well. They have found, undoubtedly, their home has been their best investment. When you compare it to equities or other alternative investments, a home - whether it's a condo or a single family home - in Greater Vancouver has been a real winner.

TS: Down 15 per cent is bad, but it's a lot better than down 40 or 50 per cent.

PH: I use that a lot when I'm closing.

TS: If you invest in a GIC it's different, but nobody does that.

PH: Nobody wants to lose, but if you bring them to a picture that they're actually winning, they will act on it.

Q: You're only losing if you look back at six months ago when you didn't sell your house ...

TS: People do that. We did some research on what people's reference point was for deciding on losses. And the reference point doesn't necessarily turn out to be the price they purchased, but what was the maximum they could have made, which at some level doesn't make any sense at all. But there's that psychology out there, and I think it shows up particularly when you get these turning points. And then after a while, that's in the past and people are less focused on what I should have done two years ago as opposed to what I should have done three months ago.

MA: People like me, you see, who have been around for quite a long time in Greater Vancouver have experienced incredible appreciation. So I can tell people that I own a house in West Vancouver that has appreciated 17 times since I originally bought it. So if I've had that experience, no wonder I'm going to advise a lot of young people to get into home ownership position. That's many people's experience.

Q: What's the likelihood of that being repeated?

MA: Oh, I believe in the future of British Columbia and most particularly Vancouver, very much so. I mean, that's why in recent years our market has appreciated as much because we have attracted a lot of people to our shores. That has driven the price of housing to the quite high levels. We're the most expensive or second most expensive city in Canada, I'm not sure. (Most) We're still a lot cheaper though than other important international cities.

The other thing that has occurred is that many people have bought residences in Vancouver just like we would buy summer cottages. They live abroad but they want to have a pied a terre in Vancouver. They may come here and only stay for a week or two a year, but they do it because they'd rather stay there than a hotel room, and also because they recognize it as a good investment for them. That is certainly added to the cost of housing.

Q: Since you brought that up, an Tsur, you said the investment piece is gone: Does that mean that the froth is not going to happen again? (If people aren't buying as investment properties, what would happen with price?)

TS: A couple of issues: No. 1, we don't actually really understand what goes on with investment real estate. When you look at research and studies, it is because home owner/occupiers are such a big piece....

Q: How big?

TS: Since we don't actually 100 per cent know which unit is which. But if you take the Lower Mainland and [calculate] 2.5 million people, 2.6 people per household, that's 800,000 households, 60 per cent homeownership [so] 480,000 households.

The investment piece is still very small in the overall number. It's highly concentrated in certain product types, downtown condos, certain suburban high rise buildings. Overall, it's not a big story. Going forward, we have two things we don't really understand, which is what are those people going to do?

"[i.e.] I own five condos around the world. Well, I don't necessarily keep them all, and people will buy and sell them depending on what city is attractive or not attractive, or what city they want to be in. So we don't really understand, I don't think we really know what's going to happen to those condos over time.

A lot of local investors bought condos and some of those people are going to be squeezed, and we don't know what's going to happen with them. You've got people with pre-sales that are under water. In segments of the market there are still a lot of questions. What is the case, because of land constraints here, there are product types - single-family housing - where it's awfully hard to build new ones.

MA: There are different types of investors. There are people who you might call them investors but who only occupy the home part of the year. It's not their principal residence. There are other people who buy condominiums to rent on a long term basis, which is wonderful because it's creating rental housing. And then there are those who buy to flip the paper. Those people don't buy from our company because we don't allow flipping. We don't see those type of investors.

But I think those are more the froth, so to speak. They will get hurt in a market correction. But someone who buys to provide rental housing and as a long-term investment, they're going to be around.

Q: Patsy, what do you see on the ground in terms of buying for occupation or investment?

PH: All these years, I've never dealt with flippers. Never. If they wanted information, I've told them to go line up for themselves. I don't believe in it. I always advise my clients, own your own home. And young people, every two-three years, save enough money and put it towards your home. And when you get to your forties you should have it pretty much paid off, and you have your extra money, you have 50 per cent or so to buy another little condo somewhere. Rent it out, don't sell it, never sell anything: that is really the essence of real estate investment. That's the way I've always dealt.

I was just looking at deals that we've done in the last month and a half, over a dozen deals, that's done deals and some deals we're still working on..... In a way I find ... you talked about people coming in ...

I guess everybody witnessed how Vancouver has changed. I came in 1970, and [it has] changed, believe me, and it will yet. Because I think we were born in 1986 after Expo ended. Then we are like a toddler right now, and I think by the time, next year, the world will really get to know us after 2010. Remember, in 1986 we had a recession ... it was also in the news, we weren't doing well around that time. It started taking off in '88, in the real estate market from Hong Kong people. At the time, they'd just heard about 1997, in 1984 was the first time they'd ever heard about it. So they started coming in '88-'89. It died down a little bit when the GST came in and the [property transfer tax] changed. And we had the abolition/ not quite cancellation of the capital gains tax ...

And every time [these things happened] we said "the end of the investment market, the end of the investment market." We kept saying that [but] it just kept going up, because we still getting foreign people from Russia, east Europe - I've got a Turkish big investor [who] in the last few years has bought a lot of things in Richmond - shopping centres and stuff. Right now, big time, Mainland Chinese - remember how Mainland people in China, half of them want to be in Canada.

To make a long story short, basically, this is a baby as far as an international city is concerned. It sounds totally unaffordable for Canadian people, which was the same thing when I first went into the market when I was 23 here. I'd go "I can't afford this." But I rented downstairs out, I rented free rooms out, I had three jobs and etcetera. And looking back, I never regretted one moment of my decision to buy a home on Government Road [in Burnaby], Bob Rennie's neighbour.

Basically, what I'm saying is, it doesn't matter how difficult it seems. Immigrant[s]. I was a new immigrant in 1973. I'd only landed for 2 1/2 years. I ended up with my own 8,000-square-foot lot, six-year-old home, two-piece ensuite, gleaming hard wood floors. That's immigrants' dreams. As long as we keep getting immigrants into Canada, and the wealth keeps coming in, and the talent keeps coming in,.... This is heaven on earth. They will pay anything for it.

Q: Tsur, what's the expectations around the Olympics?

TS: I think anything that's good about the Olympics, in terms of the economy, has happened already. The Winter Olympics are two weeks, it's not very long. It's the Winter Olympics, which are much more focussed towards Western Europe and North America, the skier who doesn't know about Whistler already is going to be relatively limited.

I think what the Olympics has brought us is a certain kind of infrastructure that we might not have gotten already. The convention centre, a gateway project, the RAV line I suppose a little bit. That's where long-term benefits are going to be.

Q: You don't see any impact on the housing market from eyes of the world [being on Vancouver]?

TS: First of all, whether or not there is a positive economic benefit from the Olympics is not clear to begin with. That's globally. I think what Patsy's talking about about immigrants is really important in that part of what gives Vancouver, in a long run, a certain amount of strength is that Canada's an attractive destination to come to, there are a limited number of places that people are going to go in Canada and that's a certain growth in households. So you add that with the thing Michael talked about in terms of the natural churning that you get with households forming, divorce, death. You've got this basic growth. Compare that with some other places that have much more volatile household numbers and lower levels of immigration, in percentage terms, and it's something that means that even if we have a downturn, there is a base to help us grow out of it more quickly than might be the case otherwise.

So when you talk about overbuilding, you think we have too many condos, on the other hand, you've got a period of time in which that surplus would be absorbed that's much shorter time period than might be the case in places that don't have that level of immigrant-driven growth.

MA: I think one of the interesting things about this market correction is that there has been relatively little overbuilding compared to other corrections I remember, such as what occurred in the early 1980s and the late 1990s.

This time, the banks have insisted on pre-sales and as a consequence, right now we have a very low inventory of completed, unsold condominiums. I think it's only about one month's absorption, that is very low.

TS: [But] it's rising rapidly.

MA: For single-family, it's about 4 1/2 months. I remember in the late 1990s, we were up to around 12 - 14 months. So, that's a good indication that the supply of unsold homes is going to be rather limited. Of course people are now stopping building. Housing starts are down about 50 per cent from a year ago, and I think quite a few of my colleagues will take a bit of a holiday from building until the market strengthens again.

TS: The only thing I would caution on that is that when you look at the relationship between starts and household growth, our starts numbers are way above household growth. And that's the trying to figure out the investment and second-home share of the market, and really understanding what goes on with them.

So there isn't classic overbuilding in a Miami sense where there's a condominium with nobody owning any the units or only owning 25 per cent of the units. You don't have that kind of framework. But we do have a situation where we've built a lot more units than we've had growth in households. Some of that was clearing out sort of people who had delayed purchasing in the downturn that ran from 1994 to 2000. That is part of the story, but I just don't feel really comfortable in a market when you've got 50 per cent surplus of starts over household growth.

MA: You're referring to traditional notions of relationship between starts and household formation and headship rates. They don't necessarily pertain anymore, because many people do like to own more than one home. That is not uncommon, and it is not only overseas people who do that. People who have their principal residence on the Sunshine Coast or wherever like to have a condo in town, and vice versa.

TS: What's the one they're going to sell first when they get into trouble?

MA: I'm not so concerned about that. I don't think it's going to be the one in town.

Q: Is there anything governments, the provincial government in particular, can do vis a vis making housing a little more affordable? Because there has been a whole issue of affordability, whether it's RBC's index or other measures.

MA: Yes, the provincial government needs to help first-time buyers. We find even a couple with full-time jobs, in many cases haven't been able to save a down payment. So I think there's a role for the government. In the old days, going back a couple of decades, we had a provincial second mortgage program introduced by W.A.C. Bennett, which was very successful. We also had a home-purchase grant for first-time buyers. It was an incentive to help them get into their first home. Of course we had limits to ensure that they were modest homes, but I think that's a role, and I would recommend that really as a way right now to increase employment in the province, because you are going to be surprised at how low housing starts are going to be in the next few months. There's no quicker way of firing up an economy than getting the housing sector going, much quicker than getting public works going, and also I should say much more efficient, because it takes a relatively low amount of government funding to provide and incentive. MOst of the capital comes from the private sector.

Q: Patsy, do you hear complaints about the property transfer tax?

PH: Well, it would be nice if it [ the threshold for charging the PTT] were $800,000. I'm more into making sure first-time buyers don't get in over their head: don't get into a luxury home when you can't afford it.

But I'm more into the government doing more incentives in providing tax benefit or tax relief or regulations for tenants, bad tenants for investment.

It's not just homeowners we're dealing with, we should be really looking into helping people, local people invest right back in here.

Q: In rental properties?

PH: In rental property ... rents have come down, by the way, a two-bedroom in Richmond, 800 sq-ft is $1,530. I just leased one ... That came down from $1,800. I leased out a 15th floor for $1,530. Six months ago, when it was brand new, they leased out for $1,800. Same place, lower floor. So rents have come down, but interest rates have also come down, thank goodness.

Think again, what tax incentive is there to the homeowner to provide more affordable rental places so young people can actually save more money. And bad tenants, we see them all the time, taking advantage of the homeowner not understanding these things, not paying rent and staying there for three or four months....

That's another thing the government should do, is provide a good rental investment atmosphere for Vancouver. A lot of kids are still living at home, my 30-year-old is still living at home. So they can go, but it's so hard to get rid of them. But if rent were cheaper. They should moving out out 12 years ago, the old days, right? They should be renting their own little apartment and stuff. They can't afford the payment, so how do we do that so they can actually....

Q: Is there any one thing that you would suggest the government do in terms of affordability?

TS: The problem you run into is that there are a variety of objectives you're trying to achieve with a limited amount of funds. I think the easiest thing to do on affordability is get rid of the property transfer tax for first-time buyers. The reason that makes it so onerous, is that you're not borrowing money to finance it, it's coming out of your equity resources. So your cost of capital for that particular piece is really high. And getting rid of it for first-time buyers would not be a major hit on the provincial treasury. But that's a short-term, one-time fix. If you want to think about, given the geographic constraints that we have - take that as a given - how do we move forward? Doing things to streamline the regulatory process to make it easier to do certain types of development are going to have long-run effects. But that's not a quick solution, you can't just snap your fingers and do that.

Q: So, you mean all the kind of permitting process, all of the time it takes?

TS: Doing things to streamline that process, accelerate that process, remove the uncertainty. The clearer it's going to be for developers, the less of their own equity they're going to have to put up to go through that process, the quicker that process happens ... It doesn't mean you get rid of regulations, but streamlining that process and rationalizing it is something that will have a long-term benefit.

On the other hand, if you ask yourself what's the social need, poor renters are in a much tougher shape than somebody who can rent a condo but can't get the first-time house of their choice. One of the things you run into, it's not that people can't buy a house, they can't buy a house they want in the location that they want. That's a preference issue, but it's not a horrible social policy issue.

On the other hand, we have poor renters who are in really difficult straits when you think of their ability to live reasonably close to work and have a reasonable percentage of their income going to housing. Given the land prices we have in this city, probably a more aggressive social housing policy is really going to be important.

If you look at other really land-constrained environments, [such as] Honk Kong and Singapore, they have very aggressive social housing programs, extremely aggressive social housing programs. And that's because I think poor renters are ... the burden on them for affordability is really much greater than it is for the person who ... "yeah, we waited and bought a house in the neighbourhood we wanted to buy. It's not that we couldn't have bought real estate someplace, we just had preferences." And it's not clear to me that the number of people who are truly priced out of the market as opposed to being delayed for two years or instead of being a condo downtown Vancouver end up in Burnaby, that doesn't strike me as the acute issue.

PH: He mentioned Hong Kong and Singapore ... They were very, very successful only because they were resettlement areas, not right downtown. The people that are really rich don't want to live with a whole bunch of ... excuse me for saying, I'm not being ... Anybody who wants to pay $800,000 doesn't want to live with somebody who's getting the same deal, same counters and everything and pays $400,000, right? So I think that's really the failure or the success. It depends on what angle you look at Vancouver.

TS: If you sold the social housing in the Olympic village you could buy a lot more housing for more people somewhere else.

PH: That's the commentary. Chinese radio was talking about that. You could use that money and put beautiful places in, (I shouldn't use the word Surrey, people always get) in other neighbourhoods.

MA: I'd just like to point out that most people in the homebuilding industry here do consider that housing is too expensive in Greater Vancouver. And one of the benefits, perhaps, of this correction is that prices are coming down. Also, the costs of new construction will come down. Construction costs are coming down, our finance costs - the interest we pay the banks is coming down - and also land prices will eventually come down a bit.

But one thing isn't coming down, and that is the imposts we pay to municipalities. For instance, in Richmond we're building wood-frame apartments for young people, first-time buyers. We're paying over $28,000 per unit to the City of Richmond. In South Surrey, we're paying over $25,000 per unit to the city for development-cost charges again for homes we're trying to sell to first-time buyers.

This is really counter to the whole idea of making housing more affordable. So that is a real problem.

Q: Michael, on development cost charges and so on, are you concerned this is becoming more than cost recovery for the services they have to install, or are you saying they've become a profit centre?

MA: I do feel often that ... First the municipality tells us we should pay all the costs of development so they don't impact the taxpayers already resident there. Then, of course, we're paying now for community centres, fire halls, this and that: normally services that would be provided for all residents of the community. And it's a very different way of financing service extensions.

In the old days it was different. We didn't have development cost charges, and the municipality took the responsibility for the extension of sewers and road building and that sort of thing, and would charge it back to new owners over time. They would float some bonds or something of that nature, and it would be charged back over time. Here, they think 'we'll stick the developers, because we don't have a vote.' Of course all we do is try to pass it on to the buyers. So it does make for a very high cost structure and just adds to the unaffordability of housing in Greater Vancouver.

PH: And it gets passed down to the homeowners. But you're lucky you're actually paying. In Richmond now, there's a piece of land on No. 4 road, a small one, 1.75 acres, one-third of it has to be ... not payment, but on this piece of property you have to build affordable homes to, maybe seniors housing [or] whatever. You have to physically build it, non profit. It is a must.

Now you can only develop 1.1, 1.2 acres, and you have to carry this non-profit thing with you. That is just.... 'what are we doing.' We do a lot of charity, but I think it's up to us to do it the way we want to do it with our money rather than you grab our money up front and force us to do something. That's what is happening in a lot of municipalities now. Because we all have to look good, we all have to be great humanitarian people. That's really what it is. And I think that is a big factor.

MA: I know a little bit about it.

PH: That's really what it is. We have to now, if you have a piece of land, you have to provide affordable something for somebody to do so. So that's a stumbling block.

depenner@vancouversun.com

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550 Browning Place, North Vancouver
Number of Townhomes: 55
Age: 3
Developer: Mosaic Homes

Currently 4 units available. Price range $589,900-$674,900

Tanager is a collection of 55 West Coast style rowhomes located on Browning Place in North Vancouver.