Urban living is easier without auto worries

Ashley Ford
Province

It is somewhat ironic that admitted lifelong car afficionado Peter Wall is pushing non-car ownership for downtown dwellers.

The Vancouver businessman, who owns two Rollers (Rolls Royce), an Aston Martin and a Range Rover, has given a fleet of seven vehicles to his $110-million, 456-unit Electric Avenue condo complex now under construction at the corner of Burrard and Nelson. The car-sharing option is believed a first in North America and a trend Wall believes could become the norm rather than the exception in the future.

“This is a win-win situation for everyone, and we certainly intend to expand the program to our other future projects in the downtown,” says Wall.

The vehicles — four environmentally-efficient Toyota Prius hybrids, a station wagon, a van and a pickup — will be stored on site and available to condo owners who join up with the Co-operative Auto Network for interim use. The fleet was carefully chosen to give users the widest possible usage, from simple car use to moving groups of passengers or bigger items.

“It is a fabulous idea and I certainly believe that it will become more of the norm for people living downtown who only need occasional use of a car or truck.

“It encourages people to walk to work, is better for their health and the environment and essentially gives you car ownership without actually owning a car, which is very expensive,” he says.

“People often don’t appreciate the real cost of car ownership and especially for those living downtown they generally get very little use out of it,” Wall says.

It also brings the added bonus of making home ownership more economic if you convert those auto payments and insurance costs in home ownership dollars, he says.

The option appears to be an added attraction for buyers.

Bob Rennie, of Rennie Marketing Systems who is selling the condos, says approximately 350 of the units, which will sit atop nine new cinemas, have already sold.

According to the co-operative, the savings are significant. It estimates the average cost for a Lower Mainland car owner is around $400 a month, compared with $98 a month for its members.

There are various options and the co-op has a fleet a 60 vehicles. It then charges for car use based on a combination of time used and distance driven.

For instance, if you drive less than 150 kilometres a month you would pay an annual $60 administrative fee, $1.75 per hour to a max of $21 daily and 32 cents per kilometre driven for an average monthly cost of $67.

© Copyright  2003 The Province

Sun

The cheers are going up again as the housing market booms, but out on the streets it’s hell for young buyers

Jason Proctor
Other

It’s a typical afternoon for Vancouver house-shoppers.

The sign went up on the lawn eight hours ago, the realtor’s phone has been ringing off the hook all morning and — unbeknownst to the lineup of couples who all thought they had an early jump on an exclusive look at a hot property — an impromptu open-house of this $319,000 fixer-upper is about to begin. At least it has hardwood floors.

A cynic’s-eye view? Sorry to detract from the Real Estate Board’s good-news spin on the Lower Mainland’s booming market, but it’s hell out there for young buyers. Sellers with dollar signs in their eyes are asking the moon for dilapidated dumps and agents are treating customers more like bidders at an auction than people signing their lives to a serious offer.

We didn’t get the aforementioned home. The realtor refused to take offers before noon on a fixed date, inviting a bidding war. The winner bid above list, with no conditions, and for those of you unfamiliar with the process, that means no property inspection, no subject-to on financing — in short, no safety. How to compete?

Figures released this week show the benchmark price of a single family house in Vancouver is now $418,060, up 9.6 per cent from last year. The board claims that’s great news for buyers and sellers because interest rates are at record lows. But not everybody sees it that way.

Walking around one particularly horrific property, we met a couple who had sold their condo for an excellent price only to realize that they needed to buy back into the market which they had just helped to inflate. Sellers moving to Newfoundland might bank some of their profits, but stay in town and you’ll soon find we’re all drinking from the same overpriced well.

And what of the first-time buyer? It’s easy to watch the bottom line expand — especially with interest rates sitting as low as 4.75 per cent. After all, what’s $50,000 spread over 25 years? Sadly, $300,000 in Vancouver will buy you the kind of house that any self-respecting ghost would refuse to haunt. My impression is that buyers are calculating the absolute limit their earnings will allow them to pay each month, subtracting $100 for groceries and then putting in an offer.

Does anyone remember the ’80s, when interest rates went into the high teens? Ask the victims of that turnaround, many of whom simply walked away from mortgages and homes unable to make payments. Then ask yourself if you could survive a shift of even a few points in today’s rates.

We’ve been looking for only a few months, but a friend gave us a piece of advice early on which — sadly — I’m beginning to take to heart. Always remember that everyone is working for the seller. The commission is split between realtors, so — no matter how nice your agent is — it’s the seller who writes the cheque.

But my biggest beef is agents who make you feel like your $300,000 — let’s be honest, our $30,000 and the bank’s $270,000 — is a pittance. Maybe it is in a market where buyers bid blind, but let’s think for a moment about how large these figures actually are. That benchmark price is just shy of half a million. How much do you make a year?

I’m not trying to throw cold water on hot real estate — just advising a little caution. There are deals out there, and I hope we find one. But it’s about time that somebody spoke up for the buyer.

Pittance or not, we are, after all, the ones with the money.

WHAT $300,000 WILL BUY YOU IN VARIOUS CANADIAN CITIES

Source: Multiple Listings Service website at www.mls.ca

© Copyright  2003 The Province

With 25% hike this year, Squamish leads market in Greater Vancouver area

Sun

Housing prices in Squamish have soared 25 per cent in the past year and overall prices in Greater Vancouver are up nearly 10 per cent, newly released figures show. The median selling price of a detached home in Squamish was $282,000 in May. The benchmark price of a single family home in Vancouver was $418,060, up 9.6 per cent from a year ago. “The great news for buyers and sellers is that interest rates are continuing at record lows,” said Bill Binnie, president of the Real Estate Board of Greater Vancouver. “Mortgage rates are the lowest we’ve seen in over 50 years.” Reg Davies, head of the Fraser Valley Real Estate Board, said there was an encouraging increase in listings last month, giving buyers a greater choice. Median year-over-year price increases for single-family houses in other areas of Greater Vancouver and the Fraser Valley ranged from 0.4 per cent in Mission to more than 14 per cent in Abbotsford. On the Sunshine Coast, the median selling price was $201,000 in May, an increase of 5.7 per cent from $190,000 a year earlier. The highest sale prices were recorded in West Vancouver at $695,000 and Vancouver‘s west side at $675,000. The average sale price of a Surrey home was $286,166, an increase of eight per cent from a year ago. Apartment prices in Greater Vancouver were up by 9.6 per cent to $194,220 from a year earlier and townhouse prices were up 10.8 per cent to $268,830. Overall, the number of sales fell slightly in Greater Vancouver and the Fraser Valley. © Copyright 2003 The Province

Province

OTTAWA — Citing lower inflation and a slowing economy, the Bank of Canada held its key interest rate steady yesterday and sounded a much softer tone on the prospect of future rate hikes.

Analysts weren’t surprised the bank left its key overnight rate unchanged at 3.25 per cent.

Inflation slowed dramatically in April, global economies remain weak and the dramatic jump in the value of the loon is threatening exports.

All this suggests the central bank could hold rates steady for the rest of the year, analysts said.

“What caught my attention . . . was the sharp contrast between the hawkish tone in the bank’s Monetary Policy Report [in April] and the rather dovish or tame tone in this statement,” said Marc Levesque, senior economist with TD Financial Group. That initially surprised the loon, which weakened during early trading before regaining some strength.

After boosting rates five times in the past year, most recently in mid-April, the bank had been warning it intended to continuing raising borrowing costs to choke off inflation.

However, central bankers were surprised when the April Consumer Price Index, released last week, showed a dramatic drop in inflation. The core rate fell by 0.3 percentage points to 2.1 per cent — almost exactly where the bank likes it.

That seems to have changed the bank’s thinking. “Data . . . indicate that both core and total CPI inflation declined in April more than expected,” yesterday’s policy statement noted.

That, combined with economic weakness around the globe — especially in the U.S. — the SARS outbreak and a spike in the loon contributed to slower growth here, the bank added.

Economist Ted Carmichael of J.P. Morgan said that will likely prevent further rate increases, possibly for the rest of the year.

© Copyright  2003 The Province

Sun

Ashley Ford
Province

Home construction liability rates throughout Greater Vancouver and across Canada are soaring, adding hundreds of dollars to the cost of a new home for consumers.

A complex combination of factors, 9/11, poor global economy, rising theft and vandalism and increased claims are responsible for the premium hikes.

But the Canadian Home Builders Association heavily suspects the cash grab by insurance companies is to recover and replenish lower earnings and investment returns which are often due to their own poor investment decisions.

“There is no doubt it is a huge problem,” said Peter Simpson, CEO of the Greater Vancouver Home Builders Association and “we are watching it very closely. The worst part about it — the increased cost — is it gets handed right on to the home buyer.”

He said there have been a number of cases where builders cannot even get “liability and course- of-construction insurance.”

They have to arrange their own security, he says.

He quoted the situation of a West Vancouver home project worth $890,000 where the initial premium demanded was $16,000 and required the builder to mount full-time on-site security during the building period.

That was eventually lowered to $6,200, but would have only cost $2,000 two years ago.

While Simpson agrees theft and vandalism is on the rise, he doesn’t believe it has reached such an extent to warrant a tripling or more for premiums.

Sandy Beveridge of Beveridge Insurance agrees builders are in a tight spot. But so are the insurance companies, he says.

“The insurance industry is bleeding red these days and their investment income, traditionally around 15 per cent, has virtually shrunk to nothing.”

Which in turn means capital is fleeing the industry and raising premiums is one of the only alternatives they have, he said.

© Copyright  2003 The Province