Coalition calls it more equitable but residential ratepayers bear 8% hike

Ashley Ford
Province

Vancouver Fair Tax Coalition’s Ed Des Roches (left) and Bob Laurie waited five years for freeze. Photograph by : Jon Murray, The Province

VANCOUVER – Vancouver business finally got a break yesterday — but homeowners will take it on the chin.

City council voted to freeze business property-tax levels for the year. The result is homeowners face an eight-per-cent tax hike this year.

Business has long argued it was shouldering a far heavier proportion of city taxes than residents, and members of the Vancouver Fair Tax Coalition were making no apologies after council’s decision yesterday.

“This is very important to us,” said Bob Laurie, vice-president of CB Richard Ellis and co-chairman of the coalition.

“We have waited five years for this, and it marks an important beginning in restoring proportionality of taxes.”

But Vision Vancouver Coun. Raymond Louie slammed the Non-Partisan Association majority on council for failing to consult with the citizens of Vancouver before the tax hike was “rammed through.”

Louie said Mayor Sam Sullivan and his NPA cohorts “blatantly broke their promise” to ensure property taxes did not go up by more than four per cent.

“The NPA have jacked up property taxes over four times the rate of inflation, and they don’t give a damn what our citizens think,” he fumed.

Northwest Point Grey Homeowners Association president Phyllis Tyers said she was surprised the tax hike had been approved so swiftly.

Tyers said she will discuss the hike with members of her association to see what can be done to counter it.

“Many of us are retired, so this can amount to a lot of money. Many people living in this area are really not millionaires.”

Tyers said the tax hike would amount to hundreds of dollars in additional taxes for Point Grey homeowners.

But Ed Des Roches, vice-president of Plum Clothing and the coalition’s other co-chairman, praised council for taking the first steps in correcting what he termed a tax imbalance.

“This decision sends a very strong signal that [council] is finally going to deal with this,” he said.

“This is not a business-versus-residents situation. It is a matter of bringing in a fairer distribution of property taxes on a long-term basis.

“I hope residents understand that business has subsidized them for many years — and also hope it will now motivate them to look much more carefully at how their dollars are spent.”

The coalition, a non-partisan group, says Vancouver businesses pay $2.42 for every $1 of city services they consume. By contrast, residents pay 56 cents for every $1 of services consumed.

And it says Vancouver homeowners currently enjoy one of the lowest property-tax levels in the Lower Mainland.

© The Vancouver Province 2007

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Prices will double in next 20 years, CIBC report says

Mario Toneguzzi
Sun

CALGARY — Fears of a decline in future house prices sparked by demographic changes in Canada are greatly exaggerated, says a report released Wednesday by CIBC World Markets.

The report, Much Ado About Nothing: Canadian House Prices Not Based on Demographics Alone, says house prices in the country will double in the next 20 years.

“Despite downward pressure from demographic forces, on average, we expect house prices in Canada to double in the next 20 years,” said Benjamin Tal, senior economist, CIBC World Markets. “Fears of a decline resulting from the downsizing and increased liquidations of houses by seniors and the falling number of first-time buyers are highly exaggerated.”

Prices in Canada’s bigger cities, however, will likely increase even more — and at a much faster pace, he said.

“In the large cities (in Canada), they will more than double because we see that most immigrants go to large cities. We see most economic activity happening in big cities. That’s the reality of the next 20 years where big cities will be the major economic engine of the country,” said Tal.

The CIBC report looks at population growth between two cycles of housing prices, from 1987 to 2006, and from 2007 to 2026.

Between 2007 and 2026, the projected 167,000 net decline in the number of first-time buyers (Canadians between the ages of 25 and 44) is marginal, at best, said Tal. Since this age group is by far the largest contributor to overall housing demand, accounting for almost 68 per cent of all home sales, this relatively modest downturn will not significantly impact housing demand.

The largest decline (2.5 million) is projected for the 45 to 54 age group, as many baby boomers move to the next age bracket. The impact of this change is also expected to be limited, given that the 45 to 54 age group accounts for only 12 per cent of total housing demand. In fact, this moderate decline in housing demand will be partly offset by the strong increase in the age group 55 to 74 and its surprisingly high housing market activity — largely reflecting purchases of vacation and investment properties.

Tal said the Canadian housing market will have extra supply of about 250,000 houses in the next 20 years but that translates into only 12,500 homes a year during that period.

And while housing market activity will fluctuate, the report projects the average house price will mirror the performance of the past two decades.

“Assuming a two-per-cent annual inflation rate, this means that house prices in Canada are expected to double by 2026,” said Tal.

© The Vancouver Sun 2007

Malcolm Parry
Sun

George Wong Will sell and Henry Man develop the $140-million Atelier at Robson and Homer Street, Kitty-corner from the Vancouver Public Library’s main branch.

BUSINESS LUNCH: Henry Man has the $12 tuna-melt sandwich in the Westin Grand hotel’s Aria restaurant, where $13 quesadillas and $12.50 chicken sandwiches are perennial favourites.

It’s a handy place for the Magellen Developments (20/20) Inc. president and CEO to take on nourishment. One set of floor-to-ceiling windows looks down to the Robson-at-Homer Street intersection, where Man’s $140-million, 29-floor Atelier tower will soon rise. Another faces the Vancouver Public Library’s Colosseum-aping central branch, which enhances Robson Street’s white-hot reputation among those aiming to acquire Atelier’s average 830-square-foot units when they go on sale in mid-May.

Not with Man handling the sales operation, though.

True, his nine-year career at Concord Pacific Developments included an early stint as marketing VP. The 47-year-old Man also stick-handled sales on his own debut project, the 20-floor, 185-unit Freesia tower he developed at Seymour and Helmcken Street for $52-million in 2002.

Man was so deft at that gig, he even got Langley-based freesia-growing mogul Anthony (Tony) Duyvesteyn to purchase a penthouse suite.

Man has been systems-oriented since he graduated as an electrical engineer and went to work for giant BP in the Alberta oilfields. In the traditional British manner, he was quickly schooled in geology, as well as drilling, geophysical, production and reservoir engineering, and says such broad-based methodology has guided him ever since. As for developing and applying skill sets outside one’s original disciplines, like the MBA degree gained while at BP, the Hong Kong-born Man quotes the Chinese saying: “You don’t ask where a hero comes from.”

For the flogging of Atelier, the former soccer jock (and continuing coach) is anticipating a heroic performance by Macdonald Realty’s Platinum Projects head George Wong, who has been scoring consistently lately. Wong, sister Lily Korstanje and their team have reportedly sold $150 million worth of condos in seven weeks. That’s not far behind an equal period in 2005, when they raised $180 million from Aspac Developments brothers Raymond, Thomas and Walter Kwok’s 71-unit Two Harbour Green project in Coal Harbour.

Wong is happy with Atelier’s location. “When you buy Robson,” he says with his hands raised, palms upward, “you buy Vancouver.”

Nor does it hurt that city hall plans to create a yet-unnamed central-downtown park on Atelier’s block.

Like every other developer in town, devout Roman Catholic Man may cast a covetous eye on the large parcel of diocesan property down Robson between Cambie and Beatty streets. More realistically, his next projects will likely entail 40 or so townhouses on each of two Kerrisdale sites he has tied up.

Asked whether he’ll handle sales on those projects, the ever-pragmatic Wong weighed his forthcoming Atelier campaign before replying: “I’ll know in a month.”

© The Vancouver Sun 2007

Report says market decline fears ‘highly exaggerated’

Province

TORONTO — Home prices will likely double in the next 20 years despite predictions that population pressures will limit their growth, says CIBC World Markets.

A projected decline of 167,000 in the number of first-time buyers between 2007 and 2026 is “marginal, at best,” CIBC economist Benjamin Tal said. “Despite downward pressure from demographic forces, on average, we expect house prices in Canada to double in the next 20 years,” said Tal.

“Fears of a decline resulting from the downsizing and increased liquidations of houses by seniors and the falling number of first-time buyers are highly exaggerated.”

In a report released yesterday, the bank compared population growth between two cycles of housing prices, from 1987 to 2006 and from 2007 to 2026, with medium-growth, medium-immigration projections from Statistics Canada as a benchmark.

A decline of 2.5 million buyers is projected for the 45 to 54 age group, as baby boomers move to the next age bracket, but that will not severely affect prices, Tal said, as the group accounts for only 12 per cent of total housing demand.

“We estimate that in the coming 20 years, the Canadian housing market will face extra supply of roughly 250,000 houses,” Tal said.

“While at first glance this appears to be a large number, it means an average extra supply of only 12,500 homes a year during that period.”

The housing market is expected to fluctuate in the next 20 years, but the bank predicts average real house prices will mirror the performance of the past two decades.

“Assuming a two per cent annual inflation rate, this means that house prices in Canada are expected to double by 2026,” said Tal. “This increase, of course, will not be symmetrical — with large cities seeing even larger increases in home valuations.”

Higher home prices generally mean higher financial gains by banks and other lenders who provide financing to homeowners.

© The Vancouver Province 2007

Derrick Penner
Sun

Vancouver Olympics organizers have cut a $27-million cheque to the builders of the athletes village in Whistler for the 2010 Games, which will set crews loose this summer to start digging foundations and servicing the site.

The money represents the majority of the organizing committee’s financial contribution to the venue, and was released after it signed an official venue agreement with the province, Resort Municipality of Whistler, and Whistler 2020 Development Corp. at the end of March.

That agreement was the final step in turning what was to be a temporary village for 2,500 athletes during the Olympics into a permanent, $130-million neighbourhood development for 1,000 local Whistler workers.

The corporation did site-clearing work last year and will move into site servicing and foundations this year, with most of the construction of the 175 to 200 separate buildings to take place in 2008 and 2009.

“We’re in good shape,” Eric Martin, chairman of Whistler 2020 Development, said in an interview.

Martin added that Whistler jettisoned the original venue agreement that it had with the predecessor to the Vancouver Organizing Committee for the 2010 Olympic and Paralympic Games when it started leaning toward creating permanent housing out of the temporary facility.

Whistler has long had a policy of housing 75 per cent of the workforce that runs the resort inside the village, a policy that Martin said would have been under threat if more below-market housing was built within what is otherwise an ultra-expensive real estate market.

Vanoc’s contribution to the project is $35 million, $6.5 million of which has already been turned over to Whistler 2020 Development and was used to begin work.

Martin said $2 million of Vanoc funds have been held back until the completed village of duplexes, triplexes, quadruplexes with some multi-storey apartment-style buildings is turned over to house 2,500 athletes during the Games.

Martin added that the corporation will pre-sell the development prior to the Games, and the units can be delivered to owners as early as June 2010.

Nejat Sarp, vice-president of accommodations and villages for Vanoc, said Olympic organizers liked the idea of helping to build a permanent neighbourhood because it leaves a better legacy for the community and helps Vanoc reach some of its goals for environmental sustainability.

Sarp noted that temporary accommodation would have left a large vacant site behind, which would take a long time to rehabilitate.

Now, developers for the site are aiming for Leadership in Energy and Environmental Design certification for the village, which Sarp said could be a first under a pilot project.

“Vanoc’s vision has always been to ensure that when the Games are all said and done, there’s a legacy,” Sarp said. “While [achieving] that vision, we have to be sensitive that we’ve got to be supportive of communities on a long-term basis.”

© The Vancouver Sun 2007

Most young first-time buyers get help from parents, a survey by Royal LePage finds

Derrick Penner and Mario Toneguzzi
Sun

Vancouver realtor Michele Collins always reckoned that women were the driving force in real estate markets.

Recently though, Collins has noticed that more and more single women — including young, first-time buyers — are wielding influence, which seems to mirror a national survey by realty firm Royal Le-Page.

“I’d say at the beginning of my career [18 years ago], I didn’t see the number of single women buying in the market that I see now by any stretch of the imagination,” Collins, an agent with Royal LePage Westside Realty, said in an interview.

The Royal LePage Female Buyers Report, released Tuesday, found about 30 per cent of single, never-before married women own their own home, while 45 per cent of divorced or separated women, and 64 per cent of widowed women are homeowners.

Poll results also found that of the single, never-before married women who are not yet homeowners, 31 per cent said they will potentially purchase a home within three years.

In Vancouver, Collins said women look at home ownership as “an optimal way to take control of their financial security.”

And in Vancouver’s high-flying market, even first-time buyers are confidently plunking down $300,000 to $400,000 on condominiums in prime locations such as Kitsilano or downtown, but often with a bit of help from their parents.

Most of Collins’s young, first-time buyers do get parental help, “whether it’s investing jointly with their daughter, or whether [parents] are giving them an inheritance ahead of time as a gift.”

However, Collins’s female clients in their 40s and 50s are coming into the market with equity they’ve built up either on their own or during previous relationships, and often opt for half duplexes or townhouses over $700,000.

Brenda Bouw, author of Home Girl: The Single Woman’s Guide to Buying Real Estate in Canada, said women are not waiting any more to purchase homes.

“Why stick around for that white picket fence, two-car garage, mini-van dream that some people have, when you can sort of invest early and build equity,” Bouw said.

Bouw added that women are becoming more independent financially and have more earning power in the business world, so owning real estate becomes a lifestyle decision.

“It’s an achievement to have your own place,” she said.

The Royal LePage survey’s key findings include:

– Of the women who intend to purchase a home within the next three years, 56 per cent are willing to participate in bidding wars, compared with only 49 per cent of men who are willing to compete.

– 25 per cent of women said they are looking for a “fixer-upper,” and plan to do renovations themselves.

– 34 per cent of women who plan to buy a first home within the next three years said they would rather save money for a down payment than spend it on a wedding reception, compared with 27 per cent of men.

– Of women who have already purchased, their top three motivations were: it makes more sense than renting (36 per cent), want to put my money into a good investment (22 per cent), and pride of ownership (13 per cent).

Maritz Research conducted the telephone survey among a representative random sample of 1,002 Canadian females and 1,000 males aged 18 and older.

Within the female and male sample sizes, the results are considered accurate within 3.1 percentage points, 19 times out of 20 for both. Interviews were conducted between Feb. 15 and Feb. 20.

 © The Vancouver Sun 2007